Buyers Are Waiving Inspections – What Are the Risks?

Posted by Keelan McCamey on Thursday, June 16th, 2016 at 2:06pm.

Key Takeaways:

  • In a competitive seller’s market, at times in a multiple offer situation a buyer may offer to waive the inspection contingency.  This can be fine as long as the seller is aware of a few risks.
  • Even if the buyer waives inspection and agrees to pay for needed repairs, we still recommend that the buyer pay for a home inspection(s). Additionally, we suggest either one or both of the agents pay the cost of a 1 yr. home warranty for the new owner; this allows for the repair or replacement of certain mechanical items in the house that are covered by the warranty.      
  • In negotiations, anything that the seller agrees to fix goes on a form called the Inspection Resolution form.  This form is essentially part of the original contract, and is disclosed to the buyer’s lender. Whatever is listed in this form for repairs effectively survives the closing and the seller is responsible for these repairs.       
  • We recommend doing 2 walkthroughs in cases where there are repairs, per the Inspection Resolution form, that may require re-disclosure by the buyer’s lender. Communication is key to make certain the deal stays on track when coordinating with the buyer and their lender!
  • The Colorado real estate contracts are much better now than in the past regarding “as is” language. Generally speaking, anything that’s not stated in the contract as far as repairs are concerned would otherwise be considered sold as-is, per the current Colorado Real Estate Commission contract. This language helps to protect the seller post-closing for anything the new owner claims the seller knew yet did not disclose.
  • This is only a general overview and there are always exceptions! Real estate agents should always have a reputable real estate attorney they can refer clients to in case there are special circumstances that arise.

Let's Talk Real Estate, Episode 3:  Waiving Inspections & Much More! 

Final Thoughts
There are risks to any real estate transaction, so it’s important to work with an agent you trust. Navigating the CO purchase contracts can be intimidating, yet having a real estate professional in your corner can make the process much smoother.

Considering selling your home?  Please consider calling me at  303-709-8778.

Cheers,
Keelan McCamey, Realtor
Peak Realty
info@peakrealtyhomes.com

 

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