Trulia Brook…, Other/Just Looking in Brooklyn, NY

If a walk-through home inspection reveals a problem...

Asked by Trulia Brooklyn, Brooklyn, NY Tue Jan 29, 2013

If a walk-through inspection reveals a problem, but one chooses to go through with closing anyway, can they retain a percentage of the down payment (or mortgage amount) - - not to be paid until the repairs are made?

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Luke Constantino’s answer
The walk through is usually 72 hours before closing. This is something that would have to be negotiated by the buyers and seller's attorneys... Unless the place is being sold "As is" .



I'm agreeing with Mitchell on this one... Speak to your attorney.



Luke Constantino
Realtor
REMAX NEW YORK
(212) 300-3919
lukeconstantino@gmail.com
261 4th Avenuue, Brooklyn NY 11215
0 votes Thank Flag Link Wed Jan 30, 2013
BEST ANSWER
It all depends on what type of problem is discovered. Certain repairs (anything having to do with health and safety) have to be addressed upfront or the property will not pass the appraisal. In that case 1 of 2 things can be done. The seller will have to make the repairs before closing or if the seller is not willing to you can apply for Renovation Financing. This is a loan where you can borrow the funds to purchse a home and to also do the renovations all in one mortgage. So you will have one loan, one monthly payment and one set of closing cost to pay. If you would like to discuss this type of financing further please feel free to give me a call. I am a Renovation Mortgage Specilaist with Wells Fargo Home Mortgage in Brooklyn. 718-780-9110.

Looking forward to speaking with you soon!
0 votes Thank Flag Link Tue Jan 29, 2013
Here's how I describe the "walk-through" to my First Time Buyer Clients:

1. The "walk-through" inspection takes place the day before or morning of the closing.

2. Basically the home should be in similar condition to when you agreed to purchase it.

3. If there are issues a Buyer encounters during the walk-through, the Buyer should make note of those issues (with photo if necessary/possible), and immediately advise their Attorney.

4. What are some issues you might encounter on the walk-through?

First, a home must be delivered with Plumbing, Heating, and Electrical in working order and with a roof free of leaks as per pretty much EVERY contract of sale I have seen for a regular (not Foreclosed) property in New York City.

Second, what if the refrigerator is missing? Yup, that's an issue. The contract of sale might say the refrigerator is going with the Seller (because it's a premium appliance, for example), but I'd guess the contract then calls for a replacement refrigerator in its stead. What if the refrigerator doesn't work?

What if the expensive chandelier in the dining room you thought came with the house is missing? Your Attorney and the contract of sale provide guidance.

Another issue: most contracts call for a home to be delivered at closing "vacant and broom clean" If the house is neither, that's an issue.

The best guidance for what is a potential problem in the walk-through inspection is your Attorney and the Contract of sale.

5. As to negotiating monies if an issue is encountered on the walk-through, that's a matter for your Attorney, the Seller's Attorney, and, in some instances the LENDER to discuss at the closing. There's no tried and true rule; each closing is its own unique transaction. But having a good, experienced Attorney who specializes in real estate on your team, well, 'nuff said.

See below the link to my Trulia blog: HomeBuyer's Timeline for NY Metro Area Purchase


Trevor Curran
NMLS #40140
Mobile: 516-582-9181
Office: 516-829-2900
Fax: 516-829-2944
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker – NYS Dept. of Financial Services
NMLS#3528

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1 vote Thank Flag Link Wed Feb 6, 2013
This is a legal question that should be answered by a real estate attorney.
0 votes Thank Flag Link Tue Jan 29, 2013
As long as the seller agrees to it, and your attorney gets it in writing then it can be done. The money would be put into escrow until the agreed repairs are performed.
0 votes Thank Flag Link Tue Jan 29, 2013
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