What the property inspection contingency means for home sales
Understanding what the property inspection contingency means for home sales is important to both buyers and sellers. How the buying process continues depends on just how the inspection is managed.
Due diligence is observed by most home buyers, who won’t commit themselves until they have seen the results of the property survey. Of course, the results of the survey are one of the most important factors to consider, although buyers also need to take into account similar houses on the market, and any information disclosed by the seller that might influence their decision to buy. The seller also needs to factor in just how much they want that particular house.
Buyers have two important things to consider in between making an offer and actually moving in to the house. Being able to finance the sale is a must, and remaining 100 percent convinced that they want to proceed with the purchase is also key.
Due diligence can and should be exercised by both the buyer and the seller, based on the contingencies spelled out in the sales contract.
One of the most important rights, which can be exercised by both buyer and seller, is the right to terminate the sale of the house. There can be significant legal and financial penalties if the terms of the contract are not strictly adhered to, including losing the earnest money.
There is generally a timetable of steps that is followed once a contract has been drawn up, the first of which is usually the home inspection. The inspection should cover as many as possible of the issues that may influence the buyer’s decision to move ahead with the sale, including an inspection for radon, and termites, in addition to a septic and well inspection.
As a buyer, you should be able to revisit your offer for the house, based on the results of the inspection, and any issues that arise, whether anticipated or unforeseen.
A buyer can then request a repair to the property, ask for a financial credit or even back out of the sale altogether, depending on the inspection results. Of course, the buyer may accept the sale as is, and in general, either the buyer or the seller will be happier once the purchase agreement is executed.
How the seller and buyer felt at the outset of the process can significantly affect the inspection results. In order to match up with their feelings about the sale and the property, both buyer and seller adjust the sale at this point.