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Can the buyer agree to waive repair of warranted items

By
Real Estate Agent with HomeSmart License # SA577557000

Buyer Can Agree to Waive Repair of Warranted Items

 

There are a series of Q&A articles by the Arizona Association of Realtors that discuss issues related to the purchase and sale of Arizona Real Estate. They are very informational, and excellent examples of what can happen during a real estate transaction. Although this post is not legal advice, and is for informational purposes only, I thought it would be great to share with those of you who may be interested in buying or selling homes in the East Valley in the near future.

 

ISSUE:

Air ConditionerDuring the 10-day inspection period, the buyer in the Buyer Inspection Notice and Seller's Response (BINSR) furnished notice of non-working warranted items, such as the air conditioning and the swimming pool motor, and requested roof repairs, including replacement of several roof shingles. In the seller’s BINSR response, the seller agreed to make the requested roof repairs. The seller also offered a $3,000 reduction in the purchase price in lieu of “all repairs.” The buyer accepted this $3,000 offer. Is the seller still obligated to repair by close of escrow the warranted items such as the air conditioning and the swimming pool motor?

 

ANSWER:

Probably not. The seller basically offered to amend the contract by providing in the BINSR for payment of $3,000 in lieu of all repairs. After the buyer accepted the seller’s $3,000 offer to amend the contract, the seller should have no obligation to make any repairs, including repairs to warranted items such as the air conditioning and the swimming pool motor.

Posted by

         Contact Troy Erickson, Realtor®, Good Company Real Estate

Licensed Residential Realtor® in Arizona at 602-295-6807

 

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This post is for informational purposes only and should not be construed as legal advice. If you desire specific legal or tax advice, please consult the appropriate professional. The opinions expressed here represent my own and not those of my employer. Troy Erickson will not be held liable for any errors, ommissions, accuracy, validity, currentness, suitability, completeness; or any losses, injuries or damages arising from its display or use.

Comments (112)

Deb Kirschbaum
MB/Priority Properties, Inc. - Denver, CO

Creativity is the essence of any entrepreneur!  Some deals require more creativity than others, right?! 

May 27, 2015 06:06 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Deb - Yes, creativity can certainly be an asset when it comes to real estate transactions and getting them closed.

May 27, 2015 06:19 AM
Yolanda Cordova-Gilbert
Richmond, TX

Troy,

 Just stopped by to say hello and hope all is well in your world! I hope you are having a great month!

May 28, 2015 08:47 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Yolanda - Thanks so much for stopping by. I just got a listing, and already have an offer on it. Hopefully we can negotiate things to both the satisfaction of the buyer and seller.

I hope you are having a great month as well.

May 28, 2015 03:50 PM
Chuck Willman
Chuck Willman - Alpine, UT
NewHouseUtah.com

I have a sitution like this right now. It's potentially ugly but there is a time and way to ask for repairs- and, after that time is up there may be no turning back.

May 29, 2015 01:13 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Chuck - I would agree that there is a time and way to ask. Hopefully you will come up with a solution that satisfies both the buyer and seller in your case.

May 29, 2015 08:26 AM
Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES
Tropic Shores Realty - Ich spreche Deutsch! - Spring Hill, FL
Florida Waterfront and Country Club Living

Troy, with VA or FHA financing, the repairs would probably have to be done before closing but in other case, the parties can work out how they want to handle this issue just as in this example.

May 31, 2015 04:02 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Silvia - Yes I am sure the financing will have a lot to do with what things need to be in working order, like the A/C unit. That adds a whole other level to the equation.

May 31, 2015 05:32 AM
Kristin Hamilton CA REALTOR
Berkshire Hathaway California Realty - Beaumont, CA
(909) 557-6966- Specialize 55+ Communties Banning

Hi Troy Erickson 

I say No and our new form RRRR in CA has a box to check if they prefer to pay to buyer in lieu of having repairs done. Once you agree and both parties have signed, that is it. Now if the Request for Repairs doesn't state it clearly then the agents should do an addendum to make the contract CLEAR.

May 31, 2015 03:01 PM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Kristin - That sounds like California has a pretty good system.

May 31, 2015 03:12 PM
Yolanda Cordova-Gilbert
Richmond, TX

Troy,

 Thanks for stopping by my blog I appreciate the support hope you guys are busy!

Jun 02, 2015 09:46 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Yolanda - Thank you too, for stopping by. Things are going pretty good right now.

Jun 02, 2015 01:13 PM
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
Retired New Hampshire Home Stager

Great information....it's important to know the laws in your area and be prepared!

Jun 09, 2015 06:06 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Sharon - Knowledge is power, as they say. We need to know these things because it is our business to know. Thanks for commenting.

Jun 09, 2015 06:11 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Here in California a buyer can waive the contingency but it is against the advice of the Broker as well as the Realtor who represents the buyer, Endre

Aug 05, 2015 03:45 PM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Endre - Our purchase contract specifies that the seller warrants certain things to be in working condition, which include heating, cooling, electrical, and plumbing.

If they are discovered that they are not working during the inspection, the seller is obligated to repair, unless the buyer agrees to be paid compensation in lieu of repairs.

Aug 05, 2015 04:09 PM
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

"ANSWER: Probably not. "  I always do my best to eliminate possibly and probably.  It would have been crystal clear if instead of " The seller also offered a $3,000 reduction in the purchase price in lieu of “all repairs.”" the agent who wrote the language included this: 

 The seller also offered a $3,000 reduction in the purchase price in lieu of all repairs to disapproved items on Page 1 and Warranted items on Page 2 of the BINSR.

Sep 15, 2015 12:32 AM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Tony - I like the way you think.

Sep 15, 2015 11:43 AM
Margaret Rome Baltimore 410-530-2400
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

When faced with this situation, another way to deal with this:

"The home inspection contingency will be removed provided the seller reduces the contract price to X amount or agrees to a certain dollar amount at closing ."

Nov 14, 2015 02:14 PM
Troy Erickson AZ Realtor (602) 295-6807
HomeSmart - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Margaret - Well said!

Nov 14, 2015 02:26 PM