Real estate attorney Joe Downs warns that residential sale contracts often lack clear language about who pays for repairs found during inspection. Without this clause, inspection costs can balloon to $8,000 to $9,000 or more, leaving buyers and sellers blindsided by unexpected expenses.
Chapters
9 times out of 10, I have to tell you, I draft agreements of sale, and unless I put a provision in on this, it's not in there. So I see people all the time kind of after the fact who have not contemplated this kind of thing. And by the way, when I'm talking about $8,000 or $9,000 for the inspection cost, you know, when the township goes in, they're going to find things that need to be fixed. You know, so we're really talking about cure costs and how much that could be. So those numbers can get big really quickly. When I'm a buyer, I make sure To the extent possible, the seller is on the hook for all the cost involved and all the repair cost involved. And then obviously, if I'm a seller, you know, I'm going to say, "Look, I'm not going to agree up front to be responsible for a blank check." If it ends up being we need to put however many hundreds of thousands of dollars into the property to satisfy this inspection, I'm going to want some kind of out from a seller's perspective as well. But this is the kind of thing that I see missed all the time.