When the settlement date has been confirmed by the title transfer agent, and the appointment for settlement time and place has been scheduled, then we’ll schedule the pre-settlement walk through. The walk through generally takes less than a half hour.
This will usually take place the morning of closing, or perhaps the day before. Ideally, the seller will be completely moved out and left the property broom clean.
What IS a Pre-Settlement Walk Through
This walk-through is done to ensure that no significant damage was done since you last saw the property, and that as a response to your home inspection, any negotiated repairs were performed. The seller’s agent may also choose to be present.
- confirm repairs were completed
- appliances are working
- test HVAC and hot water
- check for any move-out damage
- storm windows and screens are in place or stored
- look for items included in the sale, including anything attached to the walls such as lighting fixtures, blinds, and TV mounts
- locate garage door openers and any remotes (fans, lights, blinds)
- locate any manuals for appliances and systems
- make sure all of the seller’s belongings have been removed (basement, attic, refrigerator…)
- check that the property is broom clean
- take note of the meter readings and fuel tank level
Remember, you are buying the property in the condition you saw it in when the Agreement of Sale was signed unless the agreement states otherwise. This means that if you want something fixed or replaced before settlement it should be in writing as an addendum to the agreement.
Let’s use the refrigerator as an example and assume that it is included with the sale of the home. If, after the buyer submits an offer, a few small scratches appear on the door of the refrigerator then the Agreement places no obligation on the seller to do anything because that would be considered normal wear and tear. The seller is prohibited, however, from taking the refrigerator that the buyers think they are getting and replacing it with an older or less-expensive one (that is not present condition). If the refrigerator that the buyers are to receive breaks before settlement, then the seller must either repair it, replace it, or provide the buyer with a credit. If the seller fails to do any of those three things, then the buyer has the option to terminate the Agreement.
Where there is damage from a fire or any other sort of disaster (flood, tornado, etc.) which is not repaired or replaced prior to settlement, the buyer has the choice to accept the property with the seller’s insurance reimbursement, if any, or to terminate the Agreement and get any deposits returned.
What To Do If Damage IS Found
If you should discover that a negotiated repair had not been performed, or there is new damage to the property, you will have three avenues of recourse:
- delay closing while repairs are made,
- request money be placed in escrow to cover the cost of repairs so closing can go forward or,
- request a credit to the sale price, so you will have the funds to make the repairs.
If no agreement can be reached, you may cancel the contract and walk away from purchasing the property. This is a last resort after we’ve exhausted all other options and is a rare occurrence.
What a Pre-Settlement Walk Through is NOT
The pre-settlement walk through is not:
- a time to start moving in your boxes – wait until after settlement
- when you will pick up the keys – you will get those at the settlement table
- a chance to meet your decorator or contractor
- time to show the home to your relatives or friends
REMEMBER: Electing inspections provided for in the Agreement of Sale is the best way to determine the property’s condition. If you have any questions it is better to have them answered by an inspector before settlement when you may be able to negotiate over a condition or terminate the Agreement. The main reason to do a pre-settlement walkthrough is to be sure nothing has changed.
If you have questions, please give me a call: 215-767-3839.
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