What Happens When a Home Inspection Creates a New Negotiation for the Seller?

A home inspection can create a second round of negotiation after a seller has already accepted an offer.

That does not mean every inspection item becomes the seller's responsibility. It also does not mean a seller should automatically reject everything the buyer requests.

The right response starts with the purchase agreement, the actual inspection findings and what the buyer is asking the seller to do.

An Inspection Report and a Buyer Request Are Not the Same Thing

A home inspector may identify numerous observations about a property.

That report does not automatically rewrite the purchase agreement.

What matters next is whether the buyer takes action under the inspection provisions of the contract and what the buyer actually requests.

A seller therefore needs to separate three things:

• what the inspector reported
• what the buyer is requesting
• what the purchase agreement allows

Those are not necessarily the same thing.

Does a Seller Have to Fix Everything on the Inspection Report?

Not simply because it appears in an inspection report.

The seller's obligations and the buyer's options depend on the purchase agreement and circumstances.

A buyer may ask for repairs, a financial adjustment, another solution or take another action permitted by the contract.

The seller then needs to evaluate the request rather than treating every item on the inspection report as an automatic repair list.

How Should a Seller Evaluate an Inspection Request?

I look beyond the number of items.

Ten minor observations are not necessarily more important than one substantial issue.

Questions worth considering include:

• What did the inspection actually identify?
• Is additional evaluation by a qualified professional appropriate?
• What exactly is the buyer requesting?
• What does the contract permit?
• Could the issue affect another buyer if this transaction does not close?
• Could the condition affect financing or insurability?
• What is the cost and practicality of the proposed solution?
• How strong is the rest of the transaction?

The goal is to make a business decision based on the entire transaction.

Repair, Credit, Price Change or No Change?

Inspection negotiations do not always have one solution.

Depending on the contract and circumstances, the parties may discuss repairs or other modifications to the transaction.

Sellers should understand exactly what they are agreeing to before changing contract terms.

A seller should also be careful about assuming that giving a buyer money or changing a price is always interchangeable with making a repair. Financing and closing requirements can affect what is possible.

What If the Seller Thinks the Buyer's Request Is Unreasonable?

The seller can evaluate the request based on the contract and decide how to respond.

Negotiation does not require agreeing to every request.

It also does not mean rejecting a buyer simply because the first request is aggressive.

Sometimes the best response is a counterproposal. Sometimes more information is needed. Sometimes the parties simply do not agree.

My job is to help the seller understand the request and its effect on the entire transaction before responding.

What If a Serious Problem Is Discovered?

A significant inspection finding can create considerations beyond the immediate negotiation.

Depending on the issue and circumstances, the seller may need to obtain more information and consider whether the newly discovered condition affects disclosure obligations or future marketing if the current transaction does not close.

Legal questions about disclosure obligations should be directed to an attorney when appropriate.

Don't Negotiate Against Yourself

Sellers sometimes hear that an inspection found problems and immediately start deciding how much money they should give up before seeing an actual buyer request.

That is backwards.

First understand the report, the contract and what the buyer is asking for.

Then decide whether a response is necessary and what response makes sense.

Selling a Home in Grand Blanc or Genesee County?

Inspection negotiations are one of the reasons representation still matters after an offer is accepted.

If you're considering selling and want a strategy that continues through inspection, appraisal and closing, call or text Carrie Thompson with eXp Realty at 810-893-3269.