The Home Inspection Time Line in a Short Sale
In most Real Estate transactions, there is a buyer’s agent representing a buyer and a seller’s agent representing the seller. In a traditional purchase, the home inspection is generally done within the 1st week or two after the buyer and seller have executed a contract.
This is known as a “home inspection contingency” and allows the buyer and their home inspector the opportunity to carefully look over the home for any potential structural or mechanical defects.
If the buyer does not like the results, they generally can exercise their right not to move forward with the home purchase.
When a home inspection should be completed for a short sale property can sometimes be a bone of contention among listing and selling agents.
Buyers, of course, do not want to spend money on home inspections when they do not know for sure whether their short sale offer will get approved.
In the grand scheme of things, the cost of a home inspection is relatively minor. If you love the home, you should expect to take some risks. The cost of the inspection is one of them.
In many short sale offers I receive, the buyer’s agent will ask in the offer to let the buyer do their home inspection after the short sale approval letter comes from the lender.
As a Massachusetts short sale listing agent, however, I must protect my client’s best interests.
Letting a buyer wait until after the lender’s approval to do a home inspection would allow them to walk away too late in the transaction. It could force the seller into a foreclosure sale because they would not have enough time to find another buyer.
Short Sales Are As-Is Transactions
In addition, most short sales are “as is” transactions. The seller is trying to complete a short sale, to begin with, because they do not have enough money to continue paying the mortgage.
Buyers need to understand going in that the home inspection will not be an opportunity for them to…