Inspections And Repairs
Once the lender approves a loan for the buyer, a termite inspection and general
systems and structure inspection are usually scheduled. The contract, the lender
and in some cases, the loan underwriter, may specify certain requirements such as
painting the exterior, replacing the roof or even extending a water heater exhaust
pipe.
The contract should specify a dollar limit for repairs that the seller is
willing to pay. If the property is older and costly repairs are expected, the
seller may need to allow enough to cover the repairs, or be prepared to lower
the sales price. If the underwriter is the VA or FHA, pay particular attention
to their contract specifications to avoid any complications in closing.
Generally, the buyer will select and pay for the inspection. To avoid legal
complications, the seller should not recommend or select the property inspector.
If the repairs are required by the loan underwriter, the lender may request that
the repairs be completed and the property reinspected prior to closing. If the
estimate for necessary repairs identified by the inspector or by the appraiser
exceeds the amount allowed in the contract, then the contract may be voided by
either party. If you sell your home yourself, be sure to monitor these activities
carefully to keep on schedule for the closing.
Title Requirements
Another important item on the schedule is the title search. The title company or
abstractors will conduct all the required searches and evaluate the quality of the
title, determining if the title is marketable and clear of liens.
If problems arise, suggestions are made as to what must be done to clear the title.
Most lenders, as a condition of making a loan, require title insurance on the
property. There are two policies — one to protect the lender and one that protects
the buyer. If any title problems surface in the future, the title company will deal
with them unless specifically excluded from their coverage.
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Selling A Home
Selling A Home
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