Greetings. I'm hoping someone can offer some advice. Can I be forced to pay for a home inspection prior to receiving an approval of a short?

Asked by Angel, Chicago, IL Wed Apr 25, 2012

sale?

Help the community by answering this question:

+ web reference
Web reference:

Answers

18
Jack Lewitz, Agent, Lincolnwood, IL
Thu May 3, 2012
Every buyer file must have some sort of buyer agency agreement whether signed or not between the parties. The next question is whether you charge the buyer for your time and services as Koenig & Strey is doing or considering doing? Any opinions about that?
0 votes
Lisa Montes, Agent, Carrollton, TX
Tue May 1, 2012
I would not recommend that. But if they require it and you really want the property then do it. I would rather be out a few hundred bucks than thousands of dollars on an home that has a lot of problems. Try to negotiate the best you can to get inspection done upon approval.
0 votes
Angel, Home Buyer, Chicago, IL
Sat Apr 28, 2012
Update: decided to pull the plug and cancel the contract. Sellers attorney was not willing to compromise. I honestly feel they had a higher bidder after accepting my offer and wanted to get me out of the way so that they can proceed. This whole ordeal has left my wife and i somewhat disappointed with the whole homy buying process. We provided everything that was requested of us in a timely manner and even increased our initial bid by 7000 dollars. Short Sales are too good to be true.
0 votes
Phillip James, , Chicago, IL
Thu Apr 26, 2012
You are not required to get an inspection. However, I'm not sure why you wouldn't want to get one done. That way you will be entirely familiar with the property and any issues involved. But, as it has been advised in prior answers, I would not bother with the inspection until the bank accepts the short sale package. Why take a chance of throwing money away.
0 votes
This is exactly my point. Tried to explain that to seller's attorney and compromise but they aren't willing to make changes. Contract has been canceled. I'm certain I'll find another property.
Flag Fri Apr 27, 2012
Bill J Delig…, Agent, Naperville, IL
Thu Apr 26, 2012
If you order the home inspection then common courtesy dictates that you pay for it. The sellers cannot force you to conduct a home inspection - it's totally up to you. If it's not to late have your attorney add some wording that you would be able to conduct an inspection upon short sale approval.
0 votes
Tried. Seller's attorney not willng to make changes. Contract has been canceled. I guess I'll have to start looking elsewhere
Flag Fri Apr 27, 2012
John Gall, Agent, Chicago, IL
Wed Apr 25, 2012
Nobody can force you to conduct an inspection or pay for it.

When the contract was signed during the initial phases of the short sale, the tolling of the inspection period should have been clarified. You see, with short sales, there are two acceptance points 1) When the seller agrees to the terms of the contract and agrees to submit his/her short sale application to their Bank with your contract attached, and 2) when the Bank accepts the short sale.

When I represent Buyers to a transaction, I always include a rider to the contract something to the affect of ALL CONTINGENCIES PER THE CONTRACT BEGIN TO TOLL FROM THE TIME THE LENDER ACCEPTS THE OFFER TO PURCHASE. There are different trains of thought, but there is too much risk involved with short sale approvals and I feel it is in the Buyer's best interest to not begin attorney review and inspection contingencies untl the bank accepts the offer.

When I am listing a short sale property, we try to get the inspection conducted within the first 5 business days of the SELLER accepting.

There are pros and cons to both approaches.
0 votes
Exactly
Flag Wed Apr 25, 2012
Philip Sencer, Agent, Chicago, IL
Wed Apr 25, 2012
You never need to do a home inspection. It's your choice. The issue tends to be 'when' you do it. The agent for the seller might want you to do it as soon as you have an executed contract. As the buyer you do not want to potentially waste your money so soon because the lien holder may not approve the contract so it would be a waste. Your agent should have written the offer in a way so that you do not need to do it until After THE LIEN HOLDER APPROVES THE DEAL.
0 votes
I totally agree with you Phiilip. Its actually not stipulated as to exactly when the inspection should take place. Why would I not have an inspection done? But at the same time why would I have an inspection done prior to the lien holder approving the deal? Sounds too fishy
Flag Wed Apr 25, 2012
Ivan Sagel, Agent, Chicago, IL
Wed Apr 25, 2012
Hi Angel,

It is your option to have an inspection. Nobody can force you to do it. The seller may not grant you an extension of the inspection period beyond the five days that is typical in most contracts. With short sales, the seller is usually selling the property "as is", therefore the inspection is mostly for your information.

Best of luck,

Ivan Sagel
312-515-7823
IvanSagel@DwellOneRealty.com
0 votes
Ron Thomas, Agent, Fresno, CA
Wed Apr 25, 2012
Who would be forcing you?
I have never seen the Bank force it, or order an inspection and exxpect the buyer to pay.
Your Reator might be in a position to order the inspection, but wouldn't do it without your approval.
The Seller could not care less.
Who is forcing you?

That said,
I would think it would be silly to buy a house and not have it inspected:
If you wanted a Home Warranty, you must get an Inspection.
If the situation ever came up, that you would sue anyone over the house, you wouldn't have a leg to stand on if you hadn't gotten an inspection.
Also, the new owner should be aware of anything that the house may need, now or in the future.
0 votes
Jose Hernand…, Agent, Chicago, IL
Wed Apr 25, 2012
Angel,

Depends, but in my opinion it's best to get the inspection done and over with upfront. If you're not willing to do it another buyer will, therefore if that's the property you really want get it done.

Good luck!
0 votes
Angel,
I know what you mean but at times both sides must compromise. I noticed that the seller's want the option to terminate your offer if a better offer comes in. I would walk away from that deal unless they give up that option, that's not fair to you and now I see your concern.

Hope this helps!
Flag Thu Apr 26, 2012
Easy to make such a comment when it's not your money. Lol
Thanks for your comment
Flag Wed Apr 25, 2012
Tom Kelley, Agent, Chicago, IL
Wed Apr 25, 2012
Nobody can make you pay for an inspection. However they don't have to accept your offer either. If an inspection and/or completion of Attorney Review are terms that they want to stick to - that is the seller' perogative and reasonable terms.
Web Reference:  http://tomkelleychicago.com
0 votes
George Ayling, Agent, Chicago, IL
Wed Apr 25, 2012
Depends on what was agreed to at the time you wrote the contract. If you put in you weren't going to have the inspection done prior to bank approval and they agreed your fine unless the sellers attorney modified the contract and changed it. Most short sales are being sold as-is wouldn't you want to know immediately if it was solid deal or not and not waster your time same for the seller if you don't proceed it would be a waste of time for them waiting around.
0 votes
I partially agree. It would be a waste of time and money for me to pay for an inspection prior to a final approval Time is money.
Flag Wed Apr 25, 2012
Mark Goldberg, Agent, Chicago, IL
Wed Apr 25, 2012
It really depends how you negotiated the deal. With a short sale, the parties can agree that the contingencies (i.e. Attorney and inspection) start ticking when the seller signs acceptance of the contract (prior to lender approval) while under a different scenario, the parties can agree that the contingencies only begin once the lender has approved the short sale. While I can understand that you don't want to spend money on an inspection without knowing if the lender will approve the deal, I'm sure that you can also understand a seller not wanting to waste 3 months getting the short sale approved only to find out that you're walking away over an inspection issue. As hard as it is to "waste" money on a premature inspection, that's the nature of the short sale process. You sometimes have to sweat some blood to get in on a good deal.
0 votes
Easy to say when it's not you're money. Thanks
Flag Wed Apr 25, 2012
Amy Foote, Agent, Carpentersville, IL
Wed Apr 25, 2012
BTW...I totally agree with what Joseph Schiller said. It's negotiable, but if they require and you won't do it, the deal is dead. So you'll have to determine if that's what you want.
0 votes
Matt Laricy, Agent, Chicago, IL
Wed Apr 25, 2012
You cant be forced to do anything. You can be asked to pay for your home inspection though.
0 votes
Jeff Stewart, Agent, Chicago, IL
Wed Apr 25, 2012
This should be something that was agreed to in your offer paperwork. When I represent the Seller in a short sale I make all Buyers conduct their inspection with the first five business days after my Seller accepting their offer. We do not wait until bank approval to have the Buyer conduct the inspection and I will not advise my Sellers to accept an offer where the Buyer wants to wait for bank acceptance to do the inspection. The reason I do this is because I don't want to have everyone wait 3-4 months for bank approval, the Buyer conducts the inspection and then backs out of the contract for a bad inspection. I want you to find out immediately that the home has issues and then if you want to back out right away neither side wasted 3-4 months of their time. When you think about it this way of doing it is actually beneficial to both Buyer and Seller.

Hope that helps!

Jeff Stewart
REALTOR®, @properties
3101 N. Greenview Avenue, Chicago, IL 60657
309-269-3499 CELL | 773-305-0480 FAX
jeffstewart@atproperties.com
0 votes
Your comment sounds only favorable to the seler which is expected as that's who you represent.
Flag Wed Apr 25, 2012
Amy Foote, Agent, Carpentersville, IL
Wed Apr 25, 2012
Absolutely. If that's a requirement of the sale, then you'll have to do it. Now, the advantage to you is two-fold: 1) your offer is considered stronger to the bank if you've passed inspection because they know you won't be backing out based on property condition and 2) you will be able to move on NOW to a new property instead of waiting for 6+ months to get an answer from the bank and then finding out you don't want to accept the property based on condition. The disadvantage is that you put the money for the inspection up front. Now, if it doesn't pass, then it's the best money you've ever spent. If it passes and then you can't get the deal together with the bank, then the money is wasted. But if it's a requirement of the contract, then you have to do it. I, as a listing agent, require the inspection done up front with my short sales because I want that hurdle passed up front.
0 votes
Joe Schiller, Agent, Chicago, IL
Wed Apr 25, 2012
no..you are free to reject anything and the deal is over.. it's all negotiable.. agree and move forward, disagree and end it.. very simple.
0 votes
Sounds fishy to me. The sellers accepted my offer and and i put up two thousand dollars as earnest money. The sellers attorney is stating that I have 5 days to have a home inspection done . But to also be aware that during this short sale process, they have the right to refuse my offer should they receive a better offer. Which I completely understand but feel that the inspection should be done with-in 5 days of final approval. Why would anyone In their right mind, pay for an inspection for a property and lose out to a higher bidder. Money does not grow on trees!!'
Flag Wed Apr 25, 2012
Thanks for the reponse. What I'm not quite understanding is why would someone I their right mind pay for an inspection prior to an approval. It's like buying a used car without taking it for a test drive.
Flag Wed Apr 25, 2012
Search Advice
Search
Ask our community a question

Email me when…

Learn more