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Does the Buyer Pay for Repairs?

by Art
(Massapequa, NY)

We are looking at buying a home. The home inspector said the chimney cap and the front brick staircase needs to be repaired. We were told that the buyer has to pay for the repairs. Is this so and when should we do the repairs? When do the repairs need to be completed?

=====ANSWER=====

Hello Art,

I really appreciate you stopping by my site and asking such good questions. I will try and answer them based on what you told me here.

I'm not certain, but if you had a home inspection done, you are serious about purchasing this particular home. Since it cost money for this inspection, and assuming you are the one who has paid for it, I'm confused by the results since you are being told to pay actual repairs as a result of the inspection.

If the seller has paid for the home inspection, then this would explain to me a few things. I'm kind of guessing here so please forgive me for rambling on. I will go at this from the angle of you having ordered the inspection since that is normally the case.

So if the inspector has been hired by you, he works for you and not the seller. The inspector is there to help you understand to good and the bad of the subject property. The chimney cap and front staircase need repairs. You as the buyer would not pay for these repairs because you do not own the house yet and certainly would not fix it until you did.

That is why your question stumbles me some. The seller has no right asking the buyer to do the repairs since the house belongs to them.

Now, let's look at this from the sellers side and present a different picture.

If the seller is a bank, the house is one of many they have in inventory and they just want to dump it. They could be asking you to pay for repairs or you are financing it with an FHA loan and the condition of the loan is the repairs must be made before the closing.

I hope all of this makes sense to you. If the seller is a bank and the house you are buying is a foreclosure home, then they may be putting the repairs on you. Your FHA lender wants these repairs made since they are safety related and to prevent water damage on the roof. So perhaps you are talking about an FHA appraisal since this could be where you are at in the purchase process.

If this is the case and you are going to pay for the repairs, you must ask that a repair escrow account be established at closing. So in other words, you get estimates done for the actual cost of the repairs, then you have the seller set these funds aside at the closing table with the title company. You get the repairs done after you have closed on the house using these funds.

You can normally get the seller to pay for the repairs this way since it comes out of the proceeds from the sale of the property.

I do not suggest you put one red cent into the property until you have closed. Only then would you make any repairs. Otherwise you could find yourself fixing up a house for somebody else.

Hopefully you have found this helpful. Please take the time to follow the links I provided for you in the answer. I'm certain you will find a great deal of good information here for you.

Also, just like I ask all others who write me in the blog, please pay it forward by telling others about my website. I'm working hard to provide FREE information for first time home buyers to save them time, money and mistakes.

Kind Regards,

Jeffrey S. Ragan

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