Mike Gracz The Mortgage Expert,
Publish On: October 31, 2023
This guide covers home issues during final walk-through before clear-to-close. Gustan Cho Associates Mortgage Group receives numerous phone calls every day regarding mortgage questions. During the spring real estate market 2023, we have heard some horror stories during closings—multiple issues during the final walk-through. We will dive into some of those stories throughout this blog. In this article, we will go over what you should do if there are last-second issues with the property you are buying.
The Importance of Home Inspection
The importance of a home inspection in the beginning stages of the home-buying process is incredibly important. You are buying a long-term asset for a large amount of money. The majority of Americans enter into a 30-year mortgage repayment. Not to say you will be in the house for 30 years, but it is important to make sure the home you are buying does not have underlying issues.
There are legal disclosures the seller must sign upfront about any issues with the property, but they are not always truthful. The home inspection is a great time for renegotiations for seller concessions for any issues with the property.
Any major issues must be addressed before the appraisal can be completed. For more information on the importance of home inspections, please see our HOME INSPECTION Blog. A lender does not require a home inspection, but it is something you will want to have completed. Just because you’re passed the inspection does not mean you’re out of the water yet.
Buying a Home That Needs Repairs
After the home inspection, you may have negotiated for repairs to be completed. You are relying on the seller to complete these repairs in good faith before the closing date. While most of the time, these are completed, there are still occurrences where this is a major issue. Just before the closing date, you and your realtor will complete a final walk-through of the property. At this time, you will ensure the property is in the same condition as when you agreed to purchase it.
Since the home will more than likely be empty now, you will see things that you may not have at the time of inspection. Such as scratches on the floor where furniture was before.
Usually, this is not a deal-breaker, and most sellers have the house cleaned up before the final walk-through. You will want to make sure all agreed-upon repairs have been completed. One way to avoid agreed-upon repairs being completed is to take matters into your own hands. For example, if a water heater needs to be replaced, you may ask for a seller credit and complete the repair on your own time after the closing date. Otherwise, you rely on the seller to fix the water heater to your standards.
Home Issues During Final Walk-Through and Solutions
Now, let’s dive into some horror stories. Recently, a client of ours in the Chicagoland area went to complete the final walk-through only to find out about home issues during final walk-through. The basement is currently flooded with standing water. That’s right, standing water.
The client clearly was not ready to buy that home in the condition due to home issues during final walk-through. The sellers had already moved out and had no way to know the house was flooded.
At this point, our client had to get with his real estate attorney and postpone the closing until the basement was repaired. This flooding caused a wrinkle in both the buyer’s and the seller’s lives. The closing was pushed back about ten business days so the repairs could be completed. This can be costly to the seller as there are fees, such as the rate lock extension, that must be paid.
Home Issues During Final Walk-Through With Landscaping and Maintenance
Landscaping issues and maintenance are other common issues. Many times, as the sellers are preparing for their move day, they neglect yard work. Why are there people who love yard work? We feel more people do not enjoy it. Sellers may have canceled their gardener or lawnmowing service. As a buyer, you may have a clause in the purchase contract stipulating the seller must continue to mow their grass up until the closing. We have seen credits, usually around $100, negotiated into the contract for any cleanup that may be necessary for the yard. Let’s be honest: after the mortgage lending process and moving your belongings, you likely do not want to mow the grass.
Examples of Home Issues During Final Walk-Through
We will end the horror stories with the strangest story we have heard. During a final walk-through, a family found a 15-foot boa constrictor in the crawl space of a home in Philadelphia. Of course, this was a scary moment. Animal Control was called instantly. The situation was taken care of. It did leave the buyers with a few questions, however. Are there more snakes? How did it get there? And so on.
How To Resolve Home Issues During Final Walk-Through and Who To Contact
What to do if you have a major issue during final walk-through? Many of these issues can be resolved by utilizing a real estate agent and real estate attorneys for the buying process. Handling issues like this may be impossible to do on your own. It is important to work with highly skilled real estate professionals when buying or selling a home. Please check out our blog on WORKING WITH REAL ESTATE AGENTS for more details.
Gustan Cho Associates works with a wide range of clients. All of which have different qualifications but the same end goal in mind. They would like to buy or refinance a home.
We are direct mortgage lenders without any LENDER OVERLAYS on all FHA, VA, and conventional mortgages. We strongly encourage you to contact our team, even if another lender has turned you down. Check out our five-star customer reviews. They speak for themselves. We thrive on being up-to-date on all mortgage guidelines and offering you the customer service you deserve. We are available seven days a week, including holidays. Feel free to call Mike Gracz at 630-659-7644 or text for a faster response and more information. Mike can also be reached via email at mgracz@gustancho.com.
