Uh-oh! Something isn’t right with the house on closing day! Now what?!

Closing day should be an exciting day! (Albeit, somewhat stressful for some…) You have ensured that the loan is ready; you sent the wire transfer to the attorney; you have on your best social-media-post-worthy outfit; and your agent confirmed that all agreed upon repairs have been made. So what could go wrong?

…Well…

Picture it: closing day, early spring 2020 (yes, in the middle of the Covid-19 quarantine), a gorgeous day all around. My client and I arrive at the property an hour and a half before closing for the final walkthrough. (Why didn’t we do it the night before you ask? Read on!)

It is so important that when doing a final walkthrough, you test absolutely everything. Know why? Because once you sign the final documents, the house is yours… problems and all. The offer to purchase contract in NC even spells that out explicitly.

“CLOSING SHALL CONSTITUTE ACCEPTANCE OF THE PROPERTY IN ITS THEN EXISTING CONDITION UNLESS PROVISION IS OTHERWISE MADE IN WRITING.”

You know the authors of the offer to purchase contract meant business because they made that statement all caps and bold! They want you to pay extra close attention to the warning!*

So back to my story… we test the toilet and sink downstairs; we ring the doorbell; we ensure the garage door opener is working; and then we get to the kitchen. The faucet is turned on, the cabinet doors opened, the garbage disposal turned on and… BAM! We find a leak! I’m not talking a small leak either. Apparently, the night before the closing, the seller had her regular cleaning crew do a thorough cleaning after she had already moved out. The cleaning crew knew there was a problem with the disposal because they thickly lined the bottom of the cabinet with paper towels and placed a plastic to-go cup under the disposal to catch the water… and they never informed the seller.

I don’t need to tell you how upset the seller was about this. Besides being furious with the cleaning crew for not informing her about the leak, she was also concerned about the potential for water damage to the cabinet, floor, etc. It could have been so much worse.

So what do we do in situations like this? Well, there are many options but I always urge my clients to postpone closing until the repair is fully complete. We need to ensure everything is working properly, not to mention ensure there is no water damage.

Postponing might mean that closing takes place later the same day. Sometimes it means closing the next day (or even thereafter, depending on the nature of the repairs). I know it may not always be feasible to postpone the closing because it has a domino affect on other closings. That is why other options exist. But I want you to consider this: not every seller has upstanding morals. There is the potential that after the seller has their money, they may not care as much about ensuring that the repair has been made. Where does that leave the buyer? I don’t need to tell you about the creek that they’re now traveling up…

In summary, test EVERYTHING and listen to your agent’s advice. You hired them because you trust them and they swore to protect your best interest first and foremost.

Happy Buying and Selling!

Find out more about a higher level of real estate service at  Marquis-Realty.com

?* Fear not, because there is also this to help protect the buyer, but you need to get all agreed upon repairs in writing:

“Buyer’s obligation to complete the transaction contemplated by this Contract shall be contingent upon the Property being in substantially the same or better condition at Closing as on the date of this offer, reasonable wear and tear excepted. If the Property is not in substantially the same or better condition at Closing as on the date of this offer, reasonable wear and tear excepted, Buyer may terminate this Contract by written notice delivered to Seller and the Earnest Money Deposit shall be refunded to Buyer. If the Property is not in such condition and Buyer does NOT elect to terminate this Contract, Buyer shall be entitled to receive, in addition to the Property, the proceeds of any insurance claim filed by Seller on account of any damage or destruction to the Property.”