A Home Seller's Worst Nightmare
You have found a buyer for your home, they made an offer, you accepted and both of you signed the real estate contract. Everything is set to go for closing….or not. Enter a home seller’s worst nightmare.
As a home seller, what do you do in situations such as vandalism or natural disasters, where a home is damaged after a home is in contract but before it has closed? This article will discuss how a home seller should handle unforeseen issues.
What should a seller do when they find damage?
Once damage is noticed by the seller, they should contact their homeowners insurance company to find out the coverage and claim information.
The buyer should be notified quickly as well. Working closely with your real estate agent as well as a real estate attorney is also important in this situation due to likely contract negotiations.
Who pays for the repairs?
In general even if a home is in contract to be sold to a buyer, any damage that arises should be covered by the seller. The seller’s homeowners insurance policies will most likely cover a majority of damage.
With vandalism, some insurance policies may cover it. Some policies however do not unless vandalism is added as a peril.
Note: If the property is vacant, vandalism damage may not be covered. A buyer can also opt to take on the repairs themselves asking the seller to either fund them or negotiate a lower selling price.
Can the buyer back out?
What other issues may arise in situations like this?
If the home damage is extensive and happens very close to the closing date then the closing date may have to be postponed until all repairs are fixed as well as inspections and the final walk-through are finished. In some cases a buyer may also negotiate for a re-inspection of a home after repairs are completed.
I hope you will never experience this!
No home seller wants to discover either weather related damage or vandalism to the home that is under contract. The absolute best advice I can offer in this situation would be to work closely with your experienced Realtor in order to determine what options are available to you, using this article as a guide.
More Home Seller Resources
- Important Home Seller Articles – Teresa Cowart
- Home Insurance For First-Time Buyers – Bill Gassett
- What Voids a Real Estate Contract – oureverydaylife.com
- 9 Reasons to Not Overprice Your Home – Anita Clark
- (Bonus Article for Agents!) 12 Questions to Winning Your Next Listing – Lee Davenport
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