Home Buyers Guide: What to Check in a Final Walk Through

What an exciting day; the day you close on your new home! A few days before, your REALTOR called to schedule the date and time of the final walk-through. You thought, “This is great! I needed to check the paint color in the kitchen and my parents want to see the house.” But that is not what the final walk-through is for. This is your final chance to see the property before you sign on the dotted line and close the sale. It is an appointment take seriously. You must stay focused and examine the condition of the property one last time.

The purchase agreement signed in the state of Minnesota requires the seller to warrant that the mechanicals including: central air conditioning, heating, plumbing and wiring systems are in working order on the date of closing. It also insures the buyer the right to a “walk-through” review of the property prior to closing. This is not something to waive. A few years ago, there was a news report of first-time buyers who had just closed on their new home. They intended to move right in after closing but arrived to find a nightmare. In the time since seeing the home and writing a purchase agreement, a pipe had burst and flooded the entire home. They skipped the final walk-through as they felt it a waste of time. They became the proud and very frustrated owners of a huge mess. Although they may have legal remedies for having the home repaired, these buyers would have been in a much better position if they negotiated with the seller prior to closing. Or in the case of this extreme damage, the buyers could have not signed the final documents to purchase the home.

Every buyer should do a final walk-through on the home as close to the closing as possible. I suggest to my clients that we schedule the walk-through immediately prior to the closing. We meet one hour before at the home to review the condition of the property and then go directly to the closing. Any problems are noted and I immediately contact the seller’s agent so they have time to discuss the situation with their seller before our arrival. The walk-through just prior to closing doesn’t eliminate every surprise that a new buyer might face.

But it significantly reduces the chance of closing on an unknown disaster. Here is a quick guide of some of the areas to consider during a final walk through Final Walk-Through Guide

Double Check the Paperwork **Are all work orders complete?

Exterior Review **Check for any changes to exterior since purchase agreement.

Plumbing Review **Check for any changes to plumbing since purchase agreement.

Interior Rooms Review **Check for any changes to interior since purchase agreement.

Electrical Review ****Check for any changes to electrical since purchase agreement.

Furnace and Air Conditioning Review Attic and Basement Review **Check for any changes since purchase agreement.

The final walkthrough should be done with a COMPLETE CHECKLIST and organized plan. After a review of the home inside and out with a checklist will get you back to exciting part of that final walk-through…Will the new sofa look better here or there?

5 Situations Potential Home Buyers Should Walk Away

There are times, and situations, where a qualified, potential, home buyer, believes he has discovered, the ideal home, which he would love to live in, and make a home, of their own, but, later recognize and realize, there might be reasons, to walk away! While this may often, be a rather challenging, difficult scenario and situation, it’s better to make the right decision, which is best for you, rather than making some enormous mistake/ error. With that in mind, this article will attempt to briefly examine, review, consider, and discuss, 5 instances, where it might make sense, for a potential buyer, to walk away from the deal!

1. It doesn’t “comp – out”: There are times, when the appraiser, from one’s lending institution, evaluates a particular property, at a significantly lower price/ value, from your offer. While these appraisals, at times, are invalid, at other times, they represent, you have offered too much for a particular house. Banks use Competitive Market Analysis (CMA), to guide this process, and, therefore, a wise buyer, would also focus on that. Since the amount, and/ or rate of interest, on a mortgage, might be based on this number, when it comes in, significantly lower, it might represent, walking away from the deal!

2. Major issues found by the home inspector: One should make his offer contingent upon, the results of a home inspection. While most times, the issues found, are minor and easily addressed, at others, might indicate, major issues. Why would you want to purchase a house, which will probably become, a Money Pit?

3. Seller won’t address sufficiently/ adequately, or appropriately compensate: When significant issues are discovered, a buyer should go back to the seller, and explain what was found, and ask the seller to address the issue, to his satisfaction. This might mean, having a Licensed Contractor, make the fixes, to bring the house, up to the proper quality and standards, or compensating the buyer, by either reducing the price or providing a Seller’s Concession, at closing. If the latter is the determination, it must be sufficient, to address these issues. The other possibility is some combination of repair and compensation.

4. Discovers other relevant issues: During the due diligence process, other factors, such as title issues, liens, zoning, or unanticipated surprises, might be discovered, that makes someone, reconsider.

5. Afraid it might become a Money Pit: While home buyers will nearly always, need to put some money, into any home, they purchase, if there are major issues, such as environmental, structural, etc, one risks, getting into an undesirable financial situation. No one wants a Money Pit!

Home buyers should make their offers, contingent upon, at the very minimum, mortgage considerations, and the inspection. If you can’t get what you want, and/ or need, walk away!