[M07/S05] The Buyer’s Due Diligence

The Buyer's Home Inspector

When a home is under contract to be sold, the buyer will have some period of time, typically lasting between 1 and 3 weeks, for the buyer’s due diligence on the property. If you have prepared a full and complete disclosure package for the buyer ahead of time, the buyer won’t likely be discovering anything new about the property they didn’t already know, however, it is their right and obligation to perform their own inspections.

In fact, the buyer may go ahead and re-do the same inspections which you, the home owner, provided for them in the disclosure package. If the buyer is smart, they will use top-notch inspectors who won’t miss a thing – and for this reason it’s especially important that you as the seller did your own inspections also with the very best, most thorough and detail-oriented inspectors you could find – so that the buyer will not be able to uncover anything new about your property.

If any inspection reports – yours, or the buyer’s own – indicate that work is to be done on the property, expect that the buyer will get bids to have any problemsĀ repaired as part of their due diligence. For this reason, it is important for you as the seller to have already obtained bids for any repairs which a buyer might reasonably ask for, and turn those bids over to the buyer as part of the disclosure package. If you don’t, you open yourself up to the possibility of the buyer renegotiating the deal based on bids they obtain.

The buyer cannot do any “destructive” inspections. That means the buyer cannot cut into drywall or stucco, remove shingles, or anything that would require a repair afterward. The buyer may request that such an inspection be performed, but this would require specific written permission from the home owner. The home owner is not required to grant buyer permission to do any destructive inspections.

The buyer is also required to give all copies of inspection reports and repair bids to the seller – free of charge. The buyer cannot per contract withhold these from the seller. Any and all inspection reports and bids provided by the buyer must be added to the seller’s disclosure package. In the event that the deal should fall apart, the buyer’s inspection reports and bids must be made available to all subsequent buyers, or prospective buyers. If the deal falls apart because of something the buyer discovered about the property, this would be considered a “material fact” which could affect the value of the property, and must be disclosed.

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sebfrey
Seb Frey helps long-time Bay Area homeowners make their next move easily the next one yet. If you're looking for a minimum of hassle, maximum net cash on sale, and certain results, contact Seb today.