Negotiating Repairs

February 16, 2009

Having a couple of buyers in the throes of repair requests reminds me the topic deserves a review.

When you buy a home in Tucson and use the customary purchase contract, you’re allowed an inspection period. By default, you get 10 days, but I usually like to write in 15 days. Regardless of duration, at the end of your inspection period, or earlier if you’re ready, we’ll write up a document that formally ends your inspections.

Within that document, we’ve got several options. You can:

Take the house as-is without any repairs.
Tell the Seller you’re not buying the house and walk away from the deal.
Ask for repairs.

There are two kinds of repairs – and by the way, this is a one-shot deal, we get to ask for stuff ONCE.

The first kind of things you put on that document are any non-working warranted items that you’ve discovered. The contract outlines that the heating, cooling, electrical, mechanical, and plumbing, among other things, will be in working order at close. So if you find any of those things that don’t work, you give notice to the Seller and he has to fix it.

The second kind of things you put on that document are the repairs that you want that don’t fall in that warranted items category. This could be a wide variety of things. You’ve probably got some kind of list in your head after doing inspections, so we’ll put that together and submit our request.

The seller has 3 options once they get our repair request. They can:

Agree to do everything in the way we requested
Decide not to do any repairs on our list
Propose an alternative to our repair request

If they agree to do everything in the way we requested, then we’re done, and you’re one hurdle closer to buying a home.

If they don’t agree to everything or give us an alternate solution, then we have options again. Basically, we can take it or leave it, and there are timelines associated with that decision that are negotiated in the initial purchase contract.

As a Buyer, the final decision is yours. And that’s how we negotiate repairs.

Posted by Kelley Koehler | Filed Under Purchase Contract | Leave a Comment

The Not-So-Fun Section of the Purchase Contract

February 27, 2008

I recently had the, ah, opportunity to enact some of the clauses in Section 7 of the local Tucson purchase agreement. You know, the section we head into to find out what happens when things go terribly, terribly wrong?

Let me say that our foray into section 7 was, to the best of my knowledge, an honest mistake on behalf of the other party, if there is such a thing. I believe the error made was without malice, but we end up in section 7 all the same.

First recourse if either the buyer or seller is in potential breech of contract is to give that party a chance to fix it with a 3 day cure notice. This is the somewhat friendly heads-up to the other guy to say, “hey, buddy, we’ve got a potential problem here, please fix it” with an implied OR ELSE.

The threat behind the OR ELSE? Arbitration. Mediation. Court Action. Small Claims Court, if you’re dealing with a matter $2500 or less.

Our matter fell into the small claims court bucket, and my client – being a thorough kind of guy – did some research into how small claims court works, and has allowed me to post his findings.

How Small Claims Court Works

As always, we’re not lawyers, you should seek your own legal advice, your mileage may vary.