Residential Contract Due-Diligence Period..Pay Attention
The due-diligence period in a real estate residential contract is set forth at the time of acceptance. Until the contract is executed the buyer and the seller can negotiate(or not) the timeline for the home inspection.
Buyer is obligated to perform the home inspection within the time period, if, for any reason that is not possible, the buyer may ask for an extension for the home inspection, however, the seller does not have to grant the extension. If they pass the due-diligence period and either ask for repairs or to cancel the contract as a result of the inspection, they may lose their escrow deposit.
It’s important to pay attention to these dates and calculate them correctly.
For example, if the buyer has three days to make the escrow deposit and the contract was executed on Thursday, July 19, 2018, buyers will have until the first business day to make the escrow deposit which will be July 23, 2018. Florida uses business days to calculate the time periods for Residential contracts and calendar days for Commercial Contracts.
Once the home inspection is completed, if there are any defects, the buyer may ask the seller;
-To make all the repairs(usually by licensed professionals)
-Buyer and Seller may negotiate on the repairs
-Buyer may cancel the contract and receive his/her escrow deposit as long as the home inspection was performed within the time period which was agreed on and communicated back to the seller within the time period if the buyer is looking to cancel the contract
What happens if the buyer waits until the last minute to get a home inspection and asks to cancel the contract after the due-diligence period?
Buyers and their agents must pay close attention to the dates that are on the contract as they are there for a reason. If not followed, one party is going to lose some money.
Buyers can cancel the contract, however, if they missed the deadline for the due-diligence period, they may lose their escrow deposit.
As Realtors, we have to look out for the best interest of our clients, that starts with paying close attention to the dates that are outlined in the contract.
Once there’s an executed contract, the very first thing I do is to put all the important dates on a calendar and follow up with the cooperating agent to ensure they’re met.
Please remember, contracts can calculate time differently. Whether you are the seller or the buyer, be sure to read the contract so you don’t miss any of the deadlines that are set forth.
If you are a Clermont FL homeowner thinking about selling your house or looking to buy a home, I would love to earn your business. Call or text me at 407-929-1852 or visit www.WhereToLiveInOrlando.com
Residential Contract Due-Diligence Period..Pay Attention!
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