In Colorado, home-buyers can terminate a contract for a number of reasons without losing any earnest money. One of those reasons relates to items discovered at the inspection. As a seller, doing a pre-inspection before putting your home on the market has many benefits. Here are a few…
Colorado Springs, CO April, 2018
- You will know ahead of time which items the buyer might find during their inspection. Their inspector may still find something else, but you should have most of the items covered. Knowledge is power.
- You will have the opportunity to fix most or all of those items so the buyer won’t have any inspection items that cause them to terminate.
- Most items are inexpensive fixes and easy to rectify.
- You can obtain bids for some of the items that you might prefer to negotiate as a financial resolution and have documentation ready to provide to the buyer.
- You have the opportunity to disclose up front and let the buyer know the home is being sold without certain items being fixed.
- You will be able to negotiate the terms of the contract without being blindsided later by major extra expenses during the inspection period. A roof replacement, furnace replacement, water heater, etc. are some of these.
- You will be able to show the buyers that you were proactive and took care of items along with documentation of paid receipts.
- You will have greater peace of mind knowing the condition of your home when it goes on the market.
- Items that could take time to resolve can be addressed before marketing the home so they don’t cause a delay in the contract closing.
- Buyers will assume that the “cost” of items they find is double the actual repair cost. It will put you a position of strength to be able to provide quotes for items you didn’t fix. They will still factor in an “aggravation fee” to their perceived cost.
- It’s important that you fix items that involve safety, health, operating systems and structure if possible.
Are there any drawbacks of doing a pre-inspection?
- You may find out things you didn’t know about the home that would be of concern to a buyer, but cost you money you don’t have or you weren’t prepared to spend.
- You may have some up-front expenses for items that are discovered. These would most likely still come up during the buyer inspection requests.
- You will need to disclose what you discover and what was done about those items.
Having a contract fall through and coming back on the market has a serious negative effect to your overall sale. It also adds to the perceived days on market and creates a stigma in the eyes of the future buyers.
The inspectors that are hired by the buyer may or may not be highly qualified, but regardless, the buyer is going to think that what the inspector finds is a real issue. If you have done your pre-inspection, you have the expertise of your qualified inspector to help you counter and explain any inaccuracies that might come up in the buyer inspection. Many times a buyer’s inspector will call out items that are really NOT an issue or certainly not as critical as they seem in the report. Having a good inspector on your side that has reviewed the home will put you in a better position to properly and successfully manage the inspection period of the contract with the help of your experienced real estate agent.