Check it, jot it down now or run the risk of being blamed later!
With so many of the escrow transactions being foreclosed properties that are sold as is - where is - and if you the buyer is lucky there are some minimum repairs that the seller agreed to do. As agents we have to be right on top of our responsibilities and inspect and make notations that will be in the records at the time of the transaction as well as for later on - when we get that call of complaint about something not functioning in house! Department of Real Estate has a form that you need to fill out for this protection - use it!
This is the inspection you take the buyer with you and you "walk thru the property" and jot down what you see. It doesn't take that much time and can be so valuable for you to have on file. You complete the report and give it to the buyer to sign off on it. Or you can rest assured you will hear from this buyer again!
New construction walk thru is much different from a foreclosure (as is - where is) transaction. Foreclosed you expect it to not in next to mint condition, however, a new construction you expect it to be damage free and all fixtures and structure to be in complete working condition, with nothing missing.
Sometimes escrows can get so drawn out that we just want the transaction to close and may think that it is OK to skip the final inspection because you have been out to the property so many times and you know what condition it is in. NO good! Put it on paper! Protect yourself. You must continue your agent buyer - protection all the way to the end of the transaction (or you may find yourself being blamed for something that does not work.... Or something that you forgot to Walk Thru with the buyer and check prior to close).
This is why the rules are set in place to do a Final Walk Thru on all escrow transactions. Make a list of items that you will need to take a look at and make notation of the condition.
This applies even if there were no repairs done on the property and it was indeed sold as is, where is. Final Walk thru is still a part of the transaction.
Questions to know
Were there any repairs that the seller agreed to repair? You, the agent should have checked these where they were completed and yes, you will need to re-check with your buyer just prior to close of escrow.
Is there anything missing or damaged that was not there during first walk thru? With all the vandalism going on around the country - check to see if someone came in and took any items since your buyer did the first inspection. If yes, you will need to note the missing item - with the foreclosures if something is missing it is probably not the seller that took it. Vandalism of some nature is probably to blame. Police report is required if vandalism is involved.
Once you confirm these items are intact, you should jot down all that you notice in the house. Buyers sometimes will see you making these notations or hear you mention something and will want to revisit that item.
Remember to keep your inspection simple if you are selling as is and the item of concern is not something that agreed upon to be repaired and it is not a safety issue. Buyers want to get as much done as they can (understandable) - and if you know you will not be able to get the seller to do the repair or fix, please don't make promises to that buyer. Repeat the Sold as is to them, but just make notation of the item of concern.
Start out in the front yard, back yard and do a complete walk thru the house. Check doors, windows, locks, floors, walls, fixtures, AC, Heater, outlets, garage door opener, toilets, lights, trash out (this includes trash from side of the house), check the pool to be sure the pump works. New homes structures: would include making sure it was built as promised, options are included, floors are meeting the walls correctly and all other items are in complete working order. In a new building you will need to count the outlets too!
Note: New constructions you may have a better chance of negotiations with the seller, but be sure you get any agreement to make it right BEFORE close of escrow. If it is a foreclosure and there was no agreed upon repairs, it might a little hard to negotiate this late in the transaction, but it never hurts to ask and always be sure to write down the issue - document, document. And always document.
Happy Final Walk-thru and happy closing.
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Rosemary Brooks (DRE # 01336351) Realtist, CDPE, HRC, CDSP, REO & HUD Certified
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The pre-settlement walk-through is critical to make sure the property is in the same condition as when the contract was accepted by the parites.
If not, a smart agent will protect their buyer.
Don't buy a pig in a poke.
We had one last night..we close this morning...oh yicks...still stuff he promised would be gone this morning...and when it's a short sale seller...you give them a little more breathing room...losing your house, even though you have been rescued from foreclosures is still tough.
Rosemary:
A final walk-through is crucial. And, you are right. That buyer will always remember you. On one of my walk-throughs, I smelled a strong gas odor and had a heating company come out that morning to inspect the situation before the closing. They resolved the problem and my clients were so happy, they sent me roses and also some referral business.
There are many stories about final walk-throughs. They are extremely very important.
Don't buy a pig in a poke! I love it. Might use it again. Thanks,
Sally & David - it is so tough for those that have to move, especially when they are loosing their home. Short Sale is the best option but it is still loosing their home. Sounds like you have compassion and that is great.
Claudette - yes having that documentation is one of the most important documents to have once the property is closed. ... say 5 months down the road, when the buyer figures out that the AC has stopped working and they didn't get home warranty protection.
My recent first time home buyer didn't accompany the realtor on a final walk through. It was a short sale and the seller promised to have everything out. He even left paint and other supplies for the new home owner. It worked out for the best, but it usually isn't that easy.
Unless you were there a few days before...everyone needs a final walk though.
We do ours on the way to the closing table, and then head to the Title Company.
Integrity - glad it worked out - sometimes it does not work out that smooth. Sometimes that paint is used paint that is dried up and there is lots of cans that you have to figure out how to get rid of them!
Missy - you have a great routine. Thanks for sharing it.
Soooo often I have buyers that I have to remind them to do the walk through. If I were buying, you better believe that no one would have to remind me to do it.
That is so true. In our area, we have had appliances in the home when the offer is made and at time of close, they were gone. Seller came back and got them! Good post!
Judi - and these are the ones that call you back later -- crying!
Joyce - I had that happen to me too. I believe it was the sellers but they would not own up to it.
Vacant properties get vandalized. It's just a good idea to go through the property just to make sure everything is still there, and in the same shape or better as when your buyer went through it the first time.
Just had this yesterday on a short sale. The city had come in and mowed the property and the weedeater cut the electrical lines to the air conditioning compressor. I was representing an out of state investor, and they do not like surprises, and neither do I so I do the walk through everytime.
It is essential to do a final walk-through, no matter what. Of course getting something fixed if needed in the case of an REO can be a challenge given the seller.
Jeff
Final walk thru--by the buyer's agent and the buyer--not a replacement agent! I just had one of my agents ask if it was okay if she asked someone else to do the walk thru because it was not convenient with her schedule. I asked if she wanted her commission check? Was that convenient???? She did the walk thru.
Good post. You must make sure that everything you are paying for is there. In today's market, you can take nothing for granted. I have seen air conditioning units disappear right before closing.
Joyce that was a great post and you are so right about hearing from the buyer later. One thing I have never understood, what does the "where is" part of the as is clause mean? Does that clause refer to mobile homes?
Always do your walk through - and bring your paperwork! Be firm in your request for a credit at settlement if items agreed to have not been addressed.
The more thorough you are, the higher the chances your client will come back to and refer you :).
Yes, so important, good reminder. Also...We had client about to close and noticed a roof leak on a vacant REO during the final walk through. I would inspect immediately after a rain, especially if you were in a drought (as we are in LA most of the time).
Here today gone tomorrow. CYA!
It's never done 'til it's done!
The first time I don't do a final walk-thru is when the house will have disappeared. I don't want to be sued. No matter how bad the property is, always CYA. That's the bottom line.
Yes I agree that it is very important to complete this walk through.
Rosemary - I have to agree with Missy, a final walk-through with buyers and sellers. Buyers and Sellers should insist.
You always walk through, period. It is our job to protect our client.
Even on these foreclosures, you never know what you will find...one under escrow had been taken over by druggies using the bedroom as their personal bathroom and one had a tree fall on the roof right before closing. Gotta love this job! Mostly though the final walkthroughs show a missing refrigerator that was supposed to stay or some other such item.
Good tipsl We sometimes get so wrapped up in closing the deal that we forget to do the important things!
Hi Rosemary -- Very good advice. Trust but verify.
Walkthroughs are part of the deal, never to be missed. In the case of a vacant house, I schedule the day of the closing to be as sure as possible there are no vandalism issues.
I wrote a post recently on this: http://activerain.com/blogsview/1310279/real-estate-final-inspection-the-walkthrough-before-closing
Reading thru the posts i see it's unanimous that walk thru's are the norm. I don't do them all the time but i will step up my game. Thanks
It makes sense to do the final walk through. Why not check to make sure that everything is in the same condition as it was originally?
the final walk thru is so ever important for many reasons.. One must make sure the home is in the same or better conditions prior to closing.
Geoff - vandalizing is out of control in Stockton.
Joe - not to throw more on it, but did you check with the City to make sure they did not charge the property for the service? And did they pay for the damage?
Jeff - great point. I make sure I let the buyer know that right upfront!
Erica - Great response! I love it.
Kyle - Hey! Did I tell you I had this happen to me?? They took the inside and outside and no sign of breakin!!!
Sybil - my name is Rosemary but you can call me Joyce!!! The term AS IS WHERE IS - This is a term that is supposed to clearly state that a product is being sold in current visible form.
Lisa - Best advice. If it was promised it must be done and done right!
Jerry - ouch! How did you resolve that?
Jennifer - C Y A is a must
Carol - never let your C Y A down
James: always!
Petra - while we can't make Mr. Bank the seller come and walk with us... we the agents have to represent properly.
J. Phillip - C Y A
Kathy - we see it all and I am always surprise!!! Not sure why
Melissa - Gotta CYA or hear it later or pay later.
Chris - a little trust lotta CYA
Barbara thanks I'll check out your post
Barbara - Like your check list too. Thanks for sharing it. I left a comment on yours too and suggest others check it out. Good information and suggestions.
Robert - yes do it. You will put yourself and your brokerage in a safer place. C Y A
Christine - as is Where is
Roland - As Is - WHERE IS
This is a good post and good reminder. I require that my clients attend the final walk through. Buying a home regardless of short sale, foreclosure or normal owner sale...this is still critical to be sure you are getting what you paid for.
Lisa this is exactly what is all about.