Q: The buyers bought our home in December but it doesn’t close until January 6th. Everything is now done they have $2500 earnest money on the house. The inspection is done and appraisal too. They want to see the house again 10 days before closing. My Cincinnati Realtor® wants to show it again but I am unsure about it. Should I go ahead and show it and risk them backing out? Will they lose the $2000 earnest money to us? This is really nerve racking.
–Lusik, Phoenix, AZ
A: They are probably excited! This happens ALL the time. Most likely they want to take measurements for furniture. I wouldnt worry about it at all!
Matt Laricy is a Cincinnati Realtor®® with Americorp Real Estate in Chicago, IL.
A: Review the purchase agreement you signed. Typically, the buyer has a right to a final inspection of the home to verify it is in the condition they first saw it in, that is written in the contract.
Also, if they have already removed their contingencies, then they have agreed to buy your place as it is and they have satisfied themselves as to the condition. If they pull out now, then you have a right to the liquidated damages deposit.
Nevertheless, if the buyers discover a new material defect in your home that cannot be resolved prior to close of escrow, then they have the right to cancel the agreement. Even if you say to yourself, if you do not show it, then they may not discover anything until after they moved in, this does not relieve you of legal liability. The buyers would still have the right to sue you for misrepresentation and/or fraud if they feel that you refused to show it because you had something to hide, that they discovered after they moved in.
Consider doing as your Cincinnati Realtor® has asked and show it again. The buyers can back out whether you show it or not. The $2000 is not automatically turned over to you anyways. It would likely have to go to arbitration to get it your hands on it; and this legal proceeding has its own inherent costs.
Adam Aguilar is a Cincinnati Realtor®® with Reliantra in West Toluca Lake, CA.
A: It is customary to do a final walk through the day before or the morning of closing. This is to ensure that the property is in essentially the same condition it was when they buyers purchased it. There could be many reasons that they want to see the property again, such as taking measurements so they can buy furniture. Or they may just want to verify that they things that they asked to be done have actually been done. I think it would raise a huge red flag if you refused to show it. I would check your purchase contract as well, there may be something in there regarding providing reasonable access. If all contingencies have been satisfied, they could stand to lose their earnest money deposit if they decided to back out now, and they may end up in default. But each state is different. You should consult a real estate attorney about this to be sure.
Cathy Baumbusch is a Cincinnati Realtor®® with Re/Max Allegiance in Alexandria, VA.
A: Ask why they want to see it. They may just want to take measurements or see what they need to buy to decorate. I highly doubt they plan to back out at this stage. BUT it would be better to make sure they have their mortgage commitment before you let them in. The inability to get their mortgage would be reason to cancel the deal. If they have any doubts, they could try to make it so they don’t get their mortgage. The commitment usually comes in about a week before closing. Hope that helps!
Michelle J Lane is a Cincinnati Realtor®® with Century 21 Commonwealth in Wellesley, MA.
A: Your buyers have the right to inspect the home before closing. This process is called the “pre-closing inspection” or “walk-through” and is designed to ensure that the property is in the same condition as it was when the deal was struck.
Unfortunately, many sellers will just let the property go into disrepair when a contract is signed; or worse, do damage or remove property that should be included with the sale. Frankly, I recommend that my buyers do a final walk-through no more than two or three days before the closing so as to endure that the property will be in the same condition it was when they agreed to buy it.
Lee Dworshak is a Cincinnati Realtor®® with Keller Williams LA Harbor Realty in Rancho Palos Verdes, CA.
A: The buyers usually do an inspection before closing, just for their protection as well as yours. They want to make sure all the mechanics of the home are in working order as well as any personal property included in the sale is still in the home. If the bank/mortgage company has given their final approval on the buyers and there is not a clause in your contract “subject to final inspection,” the buyers will forfeit their earnest money should they cancel the contract.
Sandy Straley is a Cincinnati Realtor®® in Layton, UT.
A: If the buyer has removed all of their contingencies(inspections, loan, appraisal, etc.), the seller has the right to the good faith deposit. Here in California, it is a state requirement for the buyer to conduct a final walk through within five days prior to closing. Sometimes to verify agreed work to be completed and the final verification of property condition.
Dominic Naidoo is a Cincinnati Realtor®® with Westside Properties in Pacific Palisades, CA.
A: As far as them losing the EMD you need to review your contract, in my state if the buyer defaults they can lose the EMD and are liable for the commission.
Tom Sams is a Cincinnati Realtor®® with Re/Max Alpha Realty in Moyock, NC.
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