Dear Michael: I am purchasing a one-bedroom condo. It is in very good condition. Do I still need to get a home inspection?
Answer: Getting a home inspection is optional, but highly recommended! The cost of a home inspection on a one-bedroom condo is about $295. The condo may look like it is in pristine condition, but hidden repairs such as plumbing, electrical, mold, appliances and other repairs may be present. Unless you’re an experienced contractor there is no way for you to know the extent of repairs. If repairs are needed chances are that your request to the seller for repairs will exceed the cost you paid for the inspection. Getting a home inspection is imperative and should never be overlooked over by a buyer.
Dear Michael: We are purchasing a home and we agreed that the seller could stay in the home for 5 days after the close of escrow. How are we guaranteed that he will move out on time?
Answer: Unfortunately that is the risk of a accepting a “rent back.” A rent back is the term used when a seller rents back the property after the close of escrow from a buyer. The reason a seller usually requests a rent back is because he/she will need the proceeds from the sale of the home in order to purchase or rent the new property where he/she is moving too. Rent backs are common so I would not worry. But every few times it does happen that the seller does not move out on time. The CAR (California Association of Realtors) form SIP (Seller in Possession) is a one-page short-term rental agreement (less than 30 days) between a buyer and a seller referring to the terms of the rent back. If seller plans to rent back over 30 days the form is RLAS (Residential Lease after Sale). If a rent back is in play, you should never close escrow without these forms!
Dear Michael: My home is in escrow and I am submitting an offer on another home so I can live closer to my grandkids. What is the risk if the buyer from my current home should cancel the purchase?
Answer: Your offer on your new home should be contingent on the sale of your current home. This way if the buyer on your current home decides to cancel the purchase for reason allowed within his/her contingency rights then your contingency on the purchased home will allow you to walk away without forfeiting your initial deposit. If you decide not to have a contingency on the sale of your current home and your buyer cancels, then you could lose your initial deposit. The initial deposit is usually up to 3% of the purchase price and is required to be deposited to escrow within 3 business days after your offer has been accepted. Timing is of the essence! You will have to keep close watch to all the dates in play. Once the buyer of your home has removed all of his/her contingencies then you can do the same on your purchase as long as you have approved and are satisfied with the property you are purchasing.
Michael Kayem is a Realtor with Re/max Estate Properties serving Culver City and the Westside since 2001. You can contact Michael with your questions at 310-390-3337 or e-mail them to him at: homes@agentmichael.com
