Seller Obligations In As-Is Sales
What's rarer than a sighting of Bigfoot riding the Loch Ness Monster under a rainbow during a blue moon? If you ask a Realtor® they might tell you it's a home inspection. Personally, I've been involved in only one transaction this year where a buyer obtained an inspection. That's not to say that no one is getting them, but they are a lot less common in recent years. That's just a result of this seller's market that we find ourselves in. If I had to summarize these recent months with one word, it would be "as-is", as every home seems to be advertising as such. And while for a seller not having to deal with a home inspection and selling your home as-is is obviously a big win, it doesn't mean they are exempt from any responsibility. So, what responsibilities do sellers have?
First, let's discuss the purpose of a home inspection.
The main purpose of a home inspection is to look at areas and aspects of a home for any issues that are not easily seen or even known by the seller. Inspections aren't meant for things that are easily identified by simply walking through a property. Most homeowners don't know every single little detail about their home, so there are always going to be items and issues that sellers are not aware of. That's where inspections come in. So now that we got that out of the way, let's get to those seller responsibilities when a buyer decides not to get one.
Let's start with the Seller's Property Disclosure. Regardless of whether a buyer obtains an inspection, sellers have to fill out and provide a copy of their property disclosure. Again, while a seller may not know every single detail about their home, serious buyers will look through these disclosures with a magnifying glass and a fine-tooth comb. So, for sellers it's important to make sure that these disclosures are filled out as accurately and as honestly as possible. Because again, even if a buyer is opting out of an inspection, any deceit on the seller's part with regard to the disclosure will find its way into the light eventually. And as their agent, you don't want any possibility of a buyer taking legal action after the fact against your seller or even against you for that matter for something misrepresented in the disclosure. Often times buyers use the Seller's Disclosure to help them determine whether they want to proceed with an inspection or even with an offer for that matter. So, making sure the disclosure is properly completed is key. Be sure to also reference the Agreement of Sale for seller's obligations as well as that lists what is required of a seller throughout the course of a transaction.
But aside from the Seller's Disclosure, sellers are expected to, well, maintain their property. That sounds like common sense, and it is, but it can be easy for sellers to assume that because they are selling their home as-is and without a home inspection, that they are AOK to convey their property no matter what the condition is. At the very least, buyers should be able to move into a home in the same condition that it was in when they submitted their offer. So, if something breaks down while the home is under contract, such as the water heater, dishwasher, AC system, etc., sellers should be expected to have those items repaired or replaced for the buyer. As-is doesn't give sellers a free pass to neglect issues like these.
Sometimes when moving out of a home sellers may happen upon an issue that they weren't initially aware of. For example, they might move a piece of furniture that has been in the same spot for 20 years only for its removal to reveal a giant hole in the wall. Again, another instance where sellers would be expected to correct an issue for the buyer. Whether it's a hole-in-the-wall, a leaking roof just unearthed of a bat infestation in the guest room, sellers have the responsibility to maintain and mitigate any issues that come to light.
So, when you're with your seller and you're celebrating their cash offer with no inspections, make sure to keep their expectations in check and let them know that they still have a responsibility to the buyer to keep the house in order.
Facts, opinions and information expressed in the Blog represent the work of the author and are believed to be accurate, but are not guaranteed. The Lancaster County Association of Realtors is not liable for any potential errors, omissions or outdated information. If errors are noted within a post, please notify the Association. Posts represent the author's opinion and are not necessarily the opinion of the Association.
