North Carolina Offer To Purchase Changing January 2011---Inspections

Yesterday I began a series of changes that are going to be part of the new offer to purchae in North Carolina. One of the changes is the home inspection. Under the current offer to purchase contract the buyer has the choice of choosing one of two alternatives when presenting an offer to a seller. Generally, most buyers chose the first option due to it's simplicity. Basically, it reads that you (the buyer) agreed to do an inspection by a certain date. Within a specified time period from that date the you provided the seller with a list of repairs you wished to have performed on the house prior to closing. The seller had to respond to your request or negotaite them. If the estimated cost of the requested repairs exceeded a certain dollar amount negotaited in the contract the buyer could walk away from the transaction and be entitled to a full refund of their earnest money. It gave the buyer numerous outs of which to use to get out of a contract based on a home inspection.

Under the new offer to purchase their is no inspection period. The due dillagence fee that is negotaited up front gives the buyer the right to have the inspection done on the home. If the buyer elects to walk away after the home inspection they can without any reason. All they lose is the due dilegence fee. However; eventhough there is no stipulation for repairs to the contract; the buyer has the right to ask the seller for any repairs. Like any other part of the contract they have the right to negotaite the repairs out during the due dillegence period.

Now, on bank owned homes or short sales where the home is being sold "as is', the rules will be a little different. The unofficial chatter iS that the banks homes being sold through short sale will not have any due dillegence fee. The banks have their own addendums that they will create upon acceptance of a contract and the short sales have an unknown time frame attached to them for when it could be negotiated. The banks presently offer the buyer once a verbal acceptance of a cotnract is made 7-10 day window to have the home inspcted and elect to follow through with the transaction or walk away. Everything I have heard is saying that is not going to change.

They way I see this working is like a pendulum. When the market favors the buyers (as it does currently) the seller will probably be more inclined to perform the repairs on the house (as long as they are reasonable). In a sellers market (like we have back in 2006 and 2007) the seller would probably be less inclined to perform all the repairs requested; if any. In a balanced market reasonable repairs will probably be performed by the seller.

Dave diCecco
Realtor/Broker
www.davedicecco.com