Final Walkthrough | LeadingLane Podcast | Episode 49

We had a situation to where the other agent went through the final. Did the final walkthrough. I think it was like two or three days before. Well, then something happened. Well, our contract reads that they have to do it within 24 hours. So now it was, you know, who's technically in breach of contract because they didn't do it within 24 hours. And they're trying to say that we didn't allow them to do a final walkthrough, but because we had that timestamp, we were able to show no, they actually chose to perform it beforehand and that's. We still allowed it. So has saved us on so many things after the transaction that, you know, it's just another little safety net.

Welcome to the Leading Lane Podcast for Real Estate Pros by Real Estate Pros with your hosts, Ashley Frederick and Stephen Burch. If you're looking for an honest opportunity, authentic and raw perspective, you found it.

Welcome back, everyone, to the Leading Lane Podcast. Today we're going to talk about a common question that I think agents maybe overlook a little bit. To do a final walkthrough or to not do a final walkthrough and what it means for your client and what risks you take both ways. Even I've heard that agents will do their final walkthrough for their client, which sounds like a great liability to take on. So, Stephen, tell me your thoughts about. Actually, let's talk about what a final walkthrough is.

Yeah, so to me, a final walkthrough is your. The final walkthrough right of the legit, right before you close on the property. And I think maybe where some of this goes is the final walkthrough is not my final inspection of the property. Final walkthrough is basically me taking the client through to make sure the last minute things, the movers didn't hit a wall, you know, punch a hole in the wall or break a window by chance or whatever else. So I don't look at a final walkthrough as like verifying all the inspections and repairs and all of the things are finished. I've already done that and I made sure before getting to that point that those are done. So. But I. So that's my definition of final walkthrough. What is.

Well, and so per our contract, it says that it's to be done within three days of the closing.

And I believe our contract says 24 hours.

Okay, so ours is three days. So yours might be interesting as far as your timing as to what that entails So I would say that here it's a little bit different. And I actually do like your method, and I think that maybe we need to talk about that here a little bit more in the office. So here, historically, that is the time when everyone checks everything. So, sure, we have invoices for the work that's been done, etc. But at the final walkthrough, then they're checking all of the repairs that were done. And, you know, nine times out of 10, something comes up that something was missed. But yes, also to make sure that when they were moving out, there wasn't any damage done to the property and just that everything is in the condition that it's supposed to be in. And, you know, I have had situations where the basement was flooded the day before, and lo and behold, that buyer didn't want to do a final walk through. You know, thankfully we did. Could you imagine what would have happened if we didn't? So I think that, yes, it's something to really check over the condition of the property moving out. And probably just in some areas, it's whether or not you're checking that that quote, unquote, final inspection has been done. One thing that I really dislike in general about real estate is bill of sales, because I don't feel like we're in the business of selling property as far as, like, personal property. I feel like we're in the business of selling property. And that's like a super frustrating one to me when they'll bring their bill of sale, which is fine, but then like, hey, where did the end table go? I mean, I don't know. And at this point in time, if you did the final walk through 30 minutes before closing, I'm probably not gonna be able to get you that end table back before closing. That's what the final walkthrough is for me. So interesting that it's 24 hours for you guys and three days for us. And I personally don't like to do them 30 minutes before closing. And that is just because we've now left our time ourselves with no time to come to an agreement to look for something that was missing, to have a, you know, if a plumbing or. I mean, like, normally when I'm there too, like, we'll run the water, we'll flush the toilets, we'll turn on the burners, and sure enough, you know, like last summer, like, there was a burner that wasn't working. Well, again, we're 30 minutes before closing. So it's not like I can have time to get a compliance person over there. So I prefer to do the day before just for the simple fact of it allows us time if something does need to be addressed. Um, I think I've maybe told the story on here, not in quite detail, but the other situation is if they're not actually moved out. So would be great to know that not 30 minutes before closing, but maybe the day before for closing. And I have had that too many times. Or they left a whole bunch of stuff in the garbage, you know, or left a whole bunch of stuff in the garage or in the basement. Same thing. Like I can call the seller and come back to get them if I have time, but otherwise we're kind of SOL or we end up delaying closing, which really doesn't go well for anyone.

Do you guys have like a. To prove that the other party, the buying party, went through the property and actually completed their final walkthrough, like any form or anything?

Yeah. So that's really gray in our area. So it used to be that people would sign a final walkthrough notice and then one broker advised against that and that that was taking on liability. So everyone kind of stopped doing it. We've kind of been on the proactive approach of now trying to go back to doing the forms. So I would say maybe, I don't know, less than 20% of them we have any proof. I mean, we have the proof of the confirmation and showing time. But as far as like an actual sign off, I mean like this morning, I have a closing this morning and I got a final walkthrough notice from the agent.

So like we in same with our market. Like there's not an actual official form that is across the board. We have one for our office that makes sure that, you know, verifying that they went through it. But also we put in there, did they waive the home warranty, you know, or they actually have it. Are the utilities in progress of being switched over or. Yes, they already. We already have confirmations. So with that, like there's so many times that I've closed on a property and the seller forgot to turn it off and then the buyers forgot to turn it on in their name. And then it became this big old fiasco. Who pays for what type of thing? And same thing with a home warranty. I remember distinctly there's a deal that there's a flip. I represented the seller and the buying side said that in the contract that the buyers wanted a home warranty and the buyer's agent was responsible for ordering. Said Home warranty? Well, they never ordered it. It was never on the settlement statement, so it never happened. Well, a few months went by, something happened, and then lo and behold, the other agent was like, well, the seller said that they're going to pay for it. Well, yeah, but you clearly says that you're going to be the one to purchase it and you didn't, so therefore didn't happen. And so it was just this back and forth of who's responsible for what and who's responsible for the actual repair. And so I just put it on our. On our final walkthrough of, you know, is there a home warranty? Yes. No. And with that being said too, there's another sign off of the buyers not wanting a home warranty. And then when there is something that happens afterwards and we didn't negotiate it, they said, well, you never offered that. Which there's tons of things that, you know, we have conversations about, but I never had proof of the buyer saying, no, I don't want a home warranty. So it's kind of like that last little checkpoint of all my basis of the things that typically fall through at the end that aren't big deals, but we can save so much headache if we actually make sure it's done before.

Is your home warranty in your offer at all?

It's written in there just basically like a checkbox if you're going to negotiate it. But it's not like waiving or saying, no, I don't want a home warranty.

Got it. I think ours specifically states like, yes, I want it or waived. Yeah, I think is helpful for sure.

And then the other thing that we do on the final walkthrough is the date and time that they actually completed the final walkthrough. We had a situation to where the other agent went through the final. Did the final walkthrough. I think it was like two or three days before. Well, then something happened. Well, our contract reads that they have to do it within 24 hours. So now it was, you know, who's technically in breach of contract because they didn't do it within 24 hours. And they're trying to say that we didn't allow them to do a final walkthrough. But because we had that timestamp, we were able to show no. They actually chose to perform it beforehand and that's. We still allowed it. So it just has saved us on so many things after the transaction that, you know, it's just another little safety net.

Do you leave it as an option for your agents to have final walkthroughs?

No, it's in our, it's on our transaction room as a required. And then if the other agent is not going to do it, then we just ask them to send us an email letting us know that they're waiving the right to go through the property.

Yeah, you know, that's what I tried to tell like my agents is it's kind of a different discussion to have with your buyers. As far as it's not like, do you want to do a final walk through, it's when do you want to do the final walk through? And I always tell them like all you have to do is give them one story like, you know, so and so had one where their basement was flooded and then they're like, oh, I probably don't want that. Why do you think that so many agents that don't do a final walkthrough.

Lazy. They're lazy. They're. I think that they, you know, why go to the property one last time? They've already been there. You know, I, and it's even crazy to me that people don't even go to the property after these repairs are done. So that if they're not going to go and look at the property and the repairs, goodness repairs once they're completed and then they're not going to do this fine walkthrough, like what in the world did you do for the, your, your client from this time that you sign the contract to the time of closing to earn your commission? I don't think that there's really anything.

I think that what we see in our market is that that's a really big issue with non local agents. So, you know, they're coming from doors away, which still blows my mind. And I think it's ridiculous. They came to show the property, never came back. So they didn't come for the home inspection, they didn't come for any repairs. They're definitely not going to come for a final walkthrough. And they're not going to drive two hours for a 30 minute final walk through and then drive two hours back and then come to the closing next day. I mean, most of these don't even come to the closing. I mean they literally come here one time. And then I always say too, like, you're a buyer's agent, you're supposed to be working in the buyer's best interest. I don't understand how you're not fulfilling those duties. But you know, I think it also goes back to like, does their buyer even know that they should have done a final walk through or. Sure. I mean, like, we talked about it in the contract. I can guarantee you they don't remember what we talked about 45 days ago.

Right. I don't think that they, they probably really even go over it in depth like that. I think it's, you know, and maybe that's where they think that because they're hiring professionals to, you know, correct these issues. Then, you know, just because there's an invoice, it's a matter of fact 100% done. Like, people still make mistakes. And you're writing from, you know, a home inspector now, the negotiations between a buyer and a seller, like, and then you're gonna have to pass that same document off to your third party vendor. Right. Like, that's a lot of telephone and that's a lot of ways for people to misinterpret what the actual request is. So I just think it's too risky to not do well.

And I think, you know, like, it goes back to doing real estate because we care about humans and not about a paycheck. And for me, like, right, you would hope that you've done such a good job for your client that they're so happy and they're going to refer you to their friends and family. So what happens when you don't do the final walk through? They get to their house and there's shit everywhere or something is broke. Like, you know, they put a hole in the wall when they were moving out their dresser or something. Like, what kind of reflection does that actually give back to the agent?

Well, absolutely, I think it's going to be there. That's the biggest black eye that you're going to get really quickly because then as they start talking to other people and they, you know, get asked, well, did you do your final walkthrough? And they say, no, my agent didn't do that. Like, and just think of the legality aspect of it now too. Like it listed in the contract, you chose not to do it. And so everybody wants to be able to point fingers really quickly. And it's a sue happy world. So of course they're going to be able to say, the first person I'm gonna go after is my agent that didn't do the final walkthrough. I wanna sue them. And then at that point, like, how do you prove that you gave that buyer the option? And they really were the ones that said, no, I don't wanna do it. That's. I Go back to the final walkthrough document or an email or some sort of communication saying either direction to verify. So we have it for our file.

Yeah. And I would just, I mean I would caution people against the like the 30 minutes before because I just.

Now I think if you went there, you know, beforehand, like if you went there a week or two before or however long before verified everything did way more thorough and then you did a little pop in final walkthrough for the.

Last things doing like an inspection review a half hour before closing.

Do. Does your home inspectors do like a re inspect for you? You might check to see if that's an option. If they would be willing to do that. It may be something that they have not even really thought about offering yours charged for it. I want to say it's like 50 bucks or 100 bucks.

Like it's depending on what it is.

Yeah, it's pretty minute because I've had.

Some that we requested them to come back and they have. But I mean I think it would be great if they looked at some type of option if they just had the amendment and was like here were these items taken care of to the best of your knowledge.

Well, and then think about it like if you, if you have a home inspector that you know that will go do this reinspect afterwards after these repairs and everything else and you can negotiate that up front with your, your buyer. Like hey, a home inspection typically is 300 but for 375 or whatever the number is, they're actually going to come back out, verify everything's done. And now where that in my opinion, like I love doing this because the liability aspect of it, not that it like removes any sort of, you know, but this is. Now you're bringing in that same third party vendor. It's not you, let's be real. I'm not a, an electrician or a plumber. Like I can see, you know, basic things but I don't want it to be on my shoulders that I said yep, everything is great. So now if we have that same person that started the home or did the home inspection and then we were able to show them. Here are the invoices from these requests from the home inspection. Verify that these are done and just give it a, you know, a green stamp on the, the home inspection again, like you can move forward. It's just way, I think it's way cleaner to be able to. And one more person for 100 bucks more like I like that idea.

Much rather reach out to them. And see if they'd be open to that. I mean, as long as they're getting paid for their time, I think that they.

Absolutely, they would.

And I think that they could give a range. Like, right. Is it is a couple repairs or. I mean, you know, like, some inspections are like, oh my God, we're going to. It could take them like another hour and a half to go through everything.

Right. But I think also too, like, you know, not everything on that home inspection is always asked for, for. For repairs. So if it's just, you know, the bullet point items from inspection notice or whatever, you know, the negotiations for inspections versus everything, I think that that might help a little bit there too. The more that we can bring in those third parties. And a lot of times these plumbers, and especially since we're in rural America, like we have a handful of select plumbers in our area, and so they're the ones that are going to be doing the repair already. Like, you can help them build that relationship with that client. And then now they make the connection of, hey, this is the company that you want to use next time you have a plumbing issue. Like, these are your go to guys, like, these are your go to electricians, et cetera, et cetera. And so I think when we position that with our vendors that we're trying to make sure that we're creating you a client for life. A lot of times they're like, well, of course I'll go out there and I'll meet them. And you know, so I kind of have. It's a. I don't want to call it a little party, but it's kind of a party of everybody coming together to verify everything is mine. Yep, absolutely. So, but again, that takes some coordination. That takes some making sure that your. Your vendors are on. On the same page, and it's making sure that you're consistent with it. Because I think if I want to be the agent, do I want to be the agent that doesn't provide the value, or do I want to be the agent that is the connector? I don't know what's going on with my voice this morning. The connector of goodness. Okay. Do I want the agent that is going to be like, not showing up for the home inspections and not showing up for the final walkthrough, or do I want to be the agent that, like, I can show truly the tangible value to my clients? Because a lot of times they can't see the things behind the scenes. So I want to be able to show all of the coordination of all of these people. And really, it's not that difficult to ask vendors to show up to a specific time. And, you know, I think, you know.

You make a good point, even just with people that are new to town. Right. Like, we all know that there are some vendors that I would never refer someone to because I've seen the work that they've done, you know, had bad experiences. So really, like, you're supposed to be the resource for them. So. Hey, Ashley, I just moved to town. Yep. This might have came up on the inspection, but I'm going to redo the bathroom anyway. Do you have a good plumber? Right. And then you're going to obviously, like, refer it to the ones that have taken care of you on your inspections, you know, or do you know a good painter? I know that people, a lot of times we'll be like, oh, that's what I loved about you is you had all these connections and everything got taken care of and no issues. Right. Like, again, that's what we're supposed to be like, not just a realtor for the transaction. It's their realtor throughout, like, five years down the road. I don't know. I think somebody asked me, like, like, yeah, who's a good carpet cleaner? Right. Same thing. Like, you're supposed to be their go to resource for those things. And that's how you keep clients for 10 years from now when they decide to sell. Like, you're the one that they were in touch with throughout all of that time. Yeah.

And it's something small, but honestly, it's something so big and impactful, not just for the transaction, but for the client experience and your value as well. Because next time a buyer doesn't want to pay your compensation, you now have true examples of how you go above and beyond. And if they're out there interviewing other people, more than likely the other person is not going to be saying that. They're going to be coordinating, you know, after inspections and all these vendors and everything else. Like, so it's just an easy way to show and differentiate yourself from your. Your competitors and keep your ass out of freaking court. Right. Like, I don't. I don't want to go to court. I don't want to do all that for something so freaking stupid and simple. In short, do your freaking final walkthrough, get documentation for me, Bring in other people to verify everything is done, and do your damn job as the realtor and make sure that you're, you know, raising the bar, raising the standard in this industry.

Do better, right?

Do better, be better. That's all I got. I have no other little, little lines with it.

Well, great. Thank you everyone for tuning in today. Be sure to like and subscribe and we'll see you next time.

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