Repairs vs Money Towards Closing Costs
You’re under contract and the closing date has been set! This is an exciting time, whether you are on the buying or selling side of this transaction. During this time frame, all the loose ends are being tied up. One such loose end is discussing and completing the repair amendment form. The repair amendment is key to nailing down what needs to be done within the home prior to closing, and ensuring that both parties are on the same page.
Specificity is key so as to best communicate expectations and requirements. Beyond that, the buyer and seller will need to agree upon the repairs to be made. How long does the seller have to make said repairs? Will the seller agree to repairs? Do repairs need to be made at all? Situations vary, as do their solutions.
In some situations, a seller may opt to concede money toward the buyer’s closing costs, in lieu of making home repairs. In others, to close a loan, certain repairs may be required by the lender. In this case, the seller would be required to remedy such items so that the home can close. Other times, a buyer may require repairs to be made in order for them to agree to buy the home. It is important that all items are agreed to IN WRITING by both parties, which bring us to our next point: BE SPECIFIC!
A phrase like “fix the drywall” for example, is incredibly vague. Which room is the cracked/broken drywall in? Does the seller need to paint over that section once it is repaired? There are many questions left up in the air in accordance with what the buyer is asking for. Similarly, it is crucial to identify whether items are to be repaired or replaced. Being specific and descriptive in the repair amendment is key for a smooth transition between ownership.
Some common items you may find on a repair amendment include: repair/clean gutters, replace/repair broken dishwashers, install a vapor barrier in the crawlspace, and adjust doors that “catch” or “stick.” Being informed of common repair items is a great way to prepare yourself for the repair amendment discussion. Visit www.nar.realtor to learn more.
Dana Baker
Administrative Assistant
Southern Legacy Homes