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Escrow Inspections and Appraisals

Inspections and Appraisals

Most buyers will have the property inspected by a licensed property inspector within the time frame that was agreed upon in the purchase agreement. Some buyers will utilize several different inspectors in order to obtain professional opinions from inspectors who specialize in a specific area (eg. roof, HVAC, structure). If the agreement is conditional upon financing, then the property will be appraised by a licensed appraiser to determine the value for the lending institution via a third party. This is done so that the lending institution can confirm their investment in your property is accurate. A buyer of a commercial property may also have a complete environmental audit performed and/or soil test, if required by the lending institution.

Contingencies

A contingency is a condition that must be met before a contract becomes legally binding. For instance, a buyer will usually include a contingency stating that their contract is binding only when there is a satisfactory home inspection report from a qualified inspector.

Before completing his or her purchase of your property, the buyer goes over every aspect of the property, as provided for by the purchase agreement and any applicable addendums. These include:

  • Obtaining financing;
  • Reviewing all pertinent documents, such as preliminary title reports and disclosure documents; and
  • Inspecting the property. The buyer has the right to determine the condition of your property by subjecting it to a wide range of inspections, such as roof, termite/pest, chimney/fireplace, property boundary survey, pool, mold, lead based paint, HVAC, etc.

Depending on the findings of these inspections, there are two possible outcomes:

1. Either the result of each inspection is satisfactory and the contingencies are removed, or
2. The buyer, after reviewing the reports and the findings, requests a renegotiation of the terms of contract (usually the price).

How do you respond objectively and fairly to the buyer when a renegotiation is demanded, while acting in your best interests? This is when Maya represents you with skilled negotiation tactics that can make a real difference in the outcome of the transaction.

Loan Approval and Appraisal

We suggest that you accept buyers who have a lender’s pre-approval, approval letter, or written loan commitment, which is a better guarantee of loan approval than a pre-qualification. Expect an appraiser from the lender’s company to review your property and verify that the sales price is appropriate.

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