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Don't Give in to the Urge to be Negative
I am sure that all of you are counseling your clients, both Buyers and Sellers, that real estate can be a frustrating and sometimes an extremely emotional experience. When your clients are buying or selling property, it’s often the largest single investment they’re ever going to make. There are times when your Buyers may experience a very real phenomenon known as Buyer’s remorse, and there are occasions when your Sellers really don’t want to sell their property, but are forced to do so because of financial, family or health reasons.
The more in tune real estate agents are with our client’s needs - the better we can assist them through whatever difficult times they may encounter during the transaction. There will be times when something may arise during the transaction that causes our clients to want to cancel the transaction. We should do everything in our power to help the client work through their difficulty, and proceed on to closing whenever possible. If closing is not possible, remember – legally, your fiduciary duty to your client’s best interests must be your top priority – not your commission.
Something that I’ve seen over and over in this business is that when Buyer and Seller clients let personalities get in the way of what’s important to them, i.e. buying and selling, it is easy for their respective Agents to also let their own emotions get out of control. The worst thing an Agent can do in this situation is to side with the client and agree that the other side is being “unreasonable, greedy, unethical, etc., etc., etc”. This strategy will almost always backfire in one way or another.
As professionals, we earn our keep by keeping a balance in the transaction and always trying to smooth out the rough spots – not contribute to their escalation. Sometimes a “let’s look at it from the other side’s standpoint for a minute” might help to calm the situation down and allow the client to concentrate on the aspects of the transaction that are really important. Resist the urge to be negative. Negativity will only make everyone look bad – including you.
If there’s a problem with a transaction, and the resolution of the client’s situation is beyond our control, we should instruct the client to send a Cancellation Request to the Escrow Company. This request needs to state in detail the reason(s) prompting the cancellation and stating how the client desires disposition of the Earnest Money Deposit. Upon receipt of the Cancellation Request from the client, the Escrow Company will initiate and forward to all parties (Buyer and Seller and their respective Brokers) formal Escrow Cancellation Instructions to be signed and returned by all parties. This process, from start to finish, takes time and may, in fact, give the canceling party time to re-think their position and decide not to cancel the transaction after all.
If the client in a transaction to be cancelled is your Seller, you will most likely immediately reinstate the listing as ‘Active’ in the MLS. You should also add a remark that any new transaction will be “subject to cancellation of the existing escrow”. Until a transaction is officially closed, it’s in the best interest of your Seller clients to continue to actively market all listings in Escrow for back-up offers. If anything happens to the existing escrow, you’ll be the hero to your clients when you have several back-up offers ready to step in to any transaction that cancels. You’re showing that you’re prepared for any contingency, and representing their interests, not just your paycheck.
There will always be new challenges in the real estate business because you’re dealing with human beings in a stressful situation. If you can assist them through this difficult transaction without resorting to negativity, you’ll earn their trust and loyalty, and, hopefully, they’ll be your clients for life - and that’s the way to have a real estate career that lasts.
I hope you’ve found this information helpful! Until next time – Take Good Care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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Top 5 Escrow Nightmares and How to Avoid Them
esp. for the State of Hawaii
When escrow is opened and the Escrow Instructions are signed by:
1. The Escrow Company
2. The Sellers
3. The Buyers
The Escrow Instructions then become, in fact, an Employment Contract between all parties involved, spelling out everyone’s duties and responsibilities. From that point on, the Escrow Company cannot legally do anything on behalf of either the Sellers or the Buyers without the written permission of both – because the Escrow Company is there to act as a fiduciary for both sides.
A few key points to remember based on the above is that, regardless of the wording in our contracts (for example, the Sales Contract, the Seller’s Disclosure Statement, etc.), all parties to the Escrow Instructions are bound by the terms & conditions of the Escrow Instructions. These instructions can even, in some cases, supersede terms outlined in the contract documents.
Some of the most common escrow nightmares are:
1. Seller is unhappy with the Buyer for a perceived or actual contract violation on the Buyer’s part. Seller desires to cancel the contract, and Seller requests the Escrow Company release the Buyer’s earnest money to the Seller as liquidated damages.
2. Buyer is unhappy with the Seller for a perceived or actual contract violation on the Seller’s part. Buyer desires to cancel the contract and Buyer requests the return of the Buyer’s earnest money deposit from the Escrow Company.
3. Buyer does not like the contents of the Seller’s Real Property Disclosure Statement and, per the provisions of the ‘Disclosure’ document, Buyer rescinds the contract and requests that all funds be “immediately returned to Buyer” by the Escrow Company.
4. Buyer does not like the contents of the Seller’s Leasehold Disclosure Documents and, per the provisions of the Residential Leasehold Property Addendum; Buyer rejects the Lease and Disclosure, and requests that all of Buyer’s deposits be refunded by the Escrow Company.
The Escrow Company, however, cannot legally release the Buyer’s earnest money deposit to anyone in the above scenarios without the written permission of both Seller & Buyer as per the written Escrow Instructions. If a dispute arises, the funds will sit in Escrow – for up to seven years - until the Seller & Buyer come to a written agreement as to the disposition of the funds, OR the Escrow Company turns the funds over to the court for Inter-Pleader Action.
5. A Power of Attorney (POA) can be a valuable and useful document and sometimes is necessary for a successful closing to occur. The problem: not all POAs can be recorded by all Escrows in Hawaii.
If your client plans on using a POA, have your Escrow Officer inspect it early on in the transaction. An original, signed POA is usually required. Have the Escrow Company ensure that the POA is recordable in the State of Hawaii. Too often your client will only have a fax or a copy of the POA which cannot be recorded, or the POA will be in a form or format not recordable in Hawaii.
If necessary, the Escrow Office will give your client a POA document which can be sent to the absent Principal for signature, notarization and return in time for the closing. Best to take action early to preclude problems at closing.
Things to Remember About Opening Escrow
Your client will probably call you shortly after opening escrow with questions about the huge envelope containing page after page of fine-print undecipherable legalize they’ve just received from the Escrow Company. There is a tendency among Agents to say, “Those are only the Escrow Instructions - don’t worry about it! It’s just “boiler-plate” language to keep the lawyers happy! Nothing to worry about - sign here, initial here…..”
It’s your responsibility to your clients, representing their best interests as their fiduciary agent, to thoroughly explain that the Escrow Instructions are a binding three-party employment contract, and to be sure that the client understands the implications of all of those instructions and the potential “nightmares” outlined above, before they sign the documents and return them to the Escrow Company.
We are members of the Real Estate Profession; however, we must also be Educators about the processes of Escrow in particular, and real estate in general if we are to take optimum care of our clients and uphold our fiduciary responsibilities to them.
I hope you have found this information helpful. Until next time – take good care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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Real Estate Made Easy
Part 2 – Working With Buyers
Prior to leaving the air-conditioned comfort of the office to view properties, an experienced and professional Agent will accomplish five fairly simple and routine functions:
1. Identify the financial neighborhood the Buyer is qualified for.
If you can learn to pre-qualify your Buyer based on their Gross Monthly Income, and Outstanding Debts, you’ll be ahead of 90% of the Agents working today. It’s simple to determine, and will take you about five minutes with your clients. We’ll go over this in more depth in a future post.
2. Identify the financial neighborhood the Buyer is comfortable with.
These first two conditions may sound similar, but they can be VERY different. Your Buyer may be able to qualify for a certain amount, but may be very uncomfortable with the monthly payment required to meet that amount. You need to find your Buyer’s comfort level, and be willing to work with that.
3. Identify the geographical neighborhood the Buyer is comfortable with.
You’ll need to spend some time with your clients, quizzing them about the kind of area they’re looking for. What elevation? In town? Outside of town? Quiet and private, or within walking distance of shops and restaurants? You can save yourself days of driving around looking at properties that don’t work for your clients if you can narrow down these basics before you ever get in the car.
It would make absolutely no sense and would be a major waste of both the Buyer’s time and the Agent’s time to begin showing property until both Buyer and Agent have addressed and are comfortable with the first three concerns.
4. Know the total inventory of properties available that will fit your client’s needs.
This is where your knowledge and professionalism come into play. Do you go to every Broker Caravan so that you know all the available properties? Do you know all the subdivisions (and their CC&Rs) and the condominium complexes (and their Association Rules & Regs)? Which complexes allow pets? Which ones have pools? Do you check out the updates, new listings and changes on the Multiple Listing Service every day? Knowledge is Power. The more you know, the better you can help your clients. All that remains is to match the Buyer’s needs and suitability with the Agent’s extensive knowledge of available inventory to identify the optimum property.
5. Have the Buyer sign a Buyer’s Representation Agreement and a Dual Agency Form prior to looking at property.
The signed Buyer’s Representation Agreement will ensure that the Agent will be paid if the Buyer buys any property from any source (like a For Sale by Owner property) during the term of the Agreement. You would never consider representing a Seller without a signed contract, why would you do it for a Buyer? Both Buyer and Agent benefit from having their mutual responsibilities spelled out – in writing- before entering into a business arrangement. Everyone would therefore know what is expected of them, and what their responsibilities are.
The Accredited Buyer Representative Course is HIGHLY recommended if you need more convincing about this changing area of real estate.
The signed Dual Agency Form satisfies the legal requirement that the client was informed upon first contact as to the concept of Agency and how it works.
Once an Agent masters the above concepts - given that sufficient inventory exists, it should be only a matter of days before a happy, satisfied Buyer is in Escrow with the property of their choice.
Scenario #2:
Don’t bother to ask the Buyer any pre-qualifying questions. Take days or weeks showing the Buyer every listing in town before making an offer & opening Escrow. Hope the Buyer can afford what they just bought. Pray that the Buyer doesn’t experience Buyer’s Remorse and cancel the Escrow because they really didn’t understand or feel comfortable with the entire process. Curse and moan because the Buyer bought a home from a FSBO or Developer and now you won’t get paid – after spending weeks showing them every property for miles around.
Which way of doing business makes more sense to you?
The choice of the above alternatives would seem to be a no-brainer; however, it is amazing how many Agents make a career (usually a very short one) of choosing the second alternative! In my humble opinion, this is the #1 reason why – according to NAR statistics – 85% of new agents are out of real estate within the first three years.
Hopefully, this will help you to be among the remaining 15% of Agents that enjoy a long and fruitful career in this very demanding profession!
I hope you’ve found this information helpful! Until next time – Take Good Care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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Real Estate Made Easy
Part One – Working With Sellers
The Real Estate Profession is by no means easy. However, it can be made a lot easier with a few simple guidelines.
Scenario #1
You leave a Seller’s home with a signed Listing Contract – congratulations!
However - if you’ve left the Seller with the impression that the sale of their property is now totally in your hands – you are in deep, deep trouble.
The message needs to be delivered loud & clear to the Seller that the Listing Contract is, in effect, a Partnership Agreement between the Agent and the Owner, with both having major responsibilities.
It must be made clear that the Seller’s responsibilities are just as important as the Agents’. If the Seller does not perform all of their responsibilities, an optimum sale will not result.
The Seller’s responsibilities are fairly simple:
1. PRICE the property RIGHT - an accurate CMA is essential.
2. Insure the property SHOWS WELL.
3. Make sure the property is AVAILABLE for showings.
The Agent’s responsibilities are also fairly simple:
1. MARKET THE SELLER’S PROPERTY to the greatest extent possible, utilizing the most effective, efficient means available. The Marketing Plan should be fully discussed with and agreed to by the Seller during the Listing Presentation.
2. PRESENT ALL OFFERS to the Seller immediately upon receipt. This is a fundamental requirement of real estate license law.
3. CONTINUE TO MARKET the property for BACK-UP OFFERS right up to the day of closing. If the deal falls through, you'll be the hero for having other Buyer clients ready to pick up the deal – instead of having to start from scratch looking for another Buyer, putting your Seller client months behind the curve.
When Seller and Agent are both aware of their respective responsibilities, and are working toward the same goal - a fast, well-priced sale – then happy, satisfied clients are the end result. These clients won’t hesitate to recommend you to their friends and family because they’ve seen that you represent their best interests – not just your commission.
I hope you have found this information helpful. Until next time – take good care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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What Does the Sales Contract Say?
Over the years, I’ve seen many situations where an Agent recognizes that a transaction is starting to go off the tracks. Their Broker is likely to get a frantic call for help and the question, “What do I do now”? Typically the Agent has a transaction in escrow, and some incident occurs that puts the closing in jeopardy. My answer to the Agent would more than likely be in the form of another question, i.e. “What does the contract say”? The contract itself, in almost every instance, holds the answer to the Agent’s question.
Often the answer to the Agent’s question is in a paragraph that does not have a “check mark” beside it – a paragraph commonly called a “boiler plate” provision of the contract. There is a tendency by some not to read those paragraphs and/or not to address them with their clients. These typically are the same Agents who tell their clients – as they progress through the multiple pages of the contract - to simply “initial here and sign here” and it is only after the deal starts to go south that anyone pays any attention to those “boiler plate” provisions.
Another concern is the Agent who simply places numbers in the “fill in the blank” type of paragraphs without regard for the consequences of what those numbers actually represent. For example, if you enter “45 Days” in a contract as the time period before closing, consider carefully what the actual closing date will be. Look at the calendar and see what day of the week the closing is scheduled. Is it on a holiday when the Escrow Company may be closed? Is it more advantageous for your client to have closing on a Friday, or a Monday? At the end of the month or the beginning of the month? How will it affect their mortgage payment? When you just fill numbers in blanks without thought for the actual circumstances involved, you could have very unhappy clients on your hands, especially if you’ve cost them money by not paying attention.
Sometimes an Agent fails to comprehend that the entire contract does, in fact, tie together and is not just page after page of totally unrelated information. The impact of every single paragraph has to be gone over with every client. Not just when something hits the fan; but in every circumstance prior to the client signing the contract.
Another dangerous tendency I have seen over the past twenty-five years is that, when deals start to go south, some Agents typically try to place the blame on the other client or on the other Agent. The rationale appears to be for the Agent to get their client convinced that the problem always lies with the other party, i.e., the other party is being unreasonable, stupid, greedy, unethical, etc.
I have never found this tactic to be anything but totally destructive. Rather than trying to work their way though the dilemma by seeking solutions, the Agent just adds fuel to the fire by doing this, and compounds the existing problem. Suddenly, the client is unsure why you, as their Agent are being so negative about another Agent. They may wonder, “Is the other Agent really that bad, or are you trying to make yourself look better at the other Agent’s expense?” When you take the high road and stay professional, everybody wins. When you take the low road – everyone looks bad.
Buying and selling real estate can be a very emotional experience and it is up to the Agent to try to keep everyone’s emotions in check – both the client’s and the Agent’s. This is especially true, but not limited to, when both clients are in the same office. Once emotion and/or greed take over, (or if the Seller happens to be a bank in a foreclosure situation), logic does not govern the situation. Logic and law are not always the same, and Realtors are, in almost all cases, dealing with Contract Law, not a course in Logic!
Comments to an upset client such as “I understand how you feel, but it may be helpful to look at the situation from the other party’s point of view….” will usually be more constructive than demeaning to the other party, and prevents fueling the hostility. A change of perspective can sometimes put an entirely different light on a client’s thought process, and could work towards finding some middle ground to operate from.
However, when all else fails, fall back on, “What does the contract say”? You may be surprised how many problems and questions can be resolved simply by a careful and thorough re-reading of what the contract says, and what the parties involved have already agreed, in writing, to do. Most of the time, pointing out what’s already there resolves the issue for everyone, with a minimum of conflict.
IT’S A DETAIL BUSINESS!
I know everyone's heard the old saying, “The Devil is in the Details!” As mentioned above, it’s a little late to read and comprehend the contract after a deal starts to come apart. Here’s a tip that I’ve found to be invaluable once the transaction is in escrow: Thoroughly go through the contract, line-by-line, highlighting each and every contract provision requiring action of some kind. Highlight with one color all of the items that are your responsibility, and use another color for the items that are the other Agent’s responsibility. This will help keep you on track for the things you need to do, but will also remind you to keep a sharp eye out to make sure that the other Agent is fulfilling their contractual responsibilities. As you know, accomplishment of all contract items is crucial to the successful conclusion of the transaction. There may be times when the other party would like to kill the deal, and may be hoping that you will fail to hold them to a contract provision, thereby enabling them to cancel the transaction. Don’t let it happen on your watch.
I hope you’ve found this information helpful! Until next time – Take Good Care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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How to Avoid Problems with, C52, C53, and C57 of the Hawaii Sales Contract (DROA), i.e., Disclosures for "Vacant" Land
This post will look at a few of the more troublesome, and sometime abused, paragraphs of the DROA; Paragraphs C-52, C53, and C57, especially as they pertain to Vacant Land.
Property Condition Maintenance, Final Walk-Through, & Removal of Items from Property.
I recently experienced a transaction where a Broker countered an offer with a deletion of these paragraphs. He stated that he did so because, “they do not apply to vacant land purchases”. Nothing could be further from the truth. This could in fact be a very expensive experience for your Buyer client if allowed to be deleted by the agent on the other side of your transaction.
Whether it is vacant land or an “improved” property, those paragraphs are there for a reason: to protect the Buyer client so that they can be assured the property is in the identical (or better) condition than when they originally inspected the property – i.e., during the Inspection Period.
And yes, “vacant” land can have numerous issues – all the more reason to NEVER sell a piece of property without a survey. At a bare minimum, at least make sure you personally walk the property looking for problems. If your clients decide they don’t want to pay for the survey, in my opinion, it would be in your best interest to pay for it yourself. At the VERY LEAST, have them sign a Survey/Staking Waiver holding you and your company harmless - if they absolutely refuse a Survey or Staking.
Some agents act like the “see no evil/hear no evil” monkeys. “If you find something, it could kill the deal!” they say. Yes, it could – but isn’t it better to lose a transaction than have your clients end up with a nightmare that YOU could have avoided for them? How much more will they rely on your judgment when you point out the issues that make a particular piece of property one to avoid – and find one that is right for them without the problems. Not to mention avoiding a potential lawsuit for yourself and your company.
Maybe the mechanic who lives next door to the vacant lot has been dumping his used oil from his oil changing business there for the last twenty years? Maybe there are leaky underground tanks that were used to store gasoline for farm vehicles. Suddenly that “vacant lot” with no problems is a Hazardous Materials site! You may find rock walls that were built partly on the neighbor’s property. Here in Hawaii, there may be an old lava tube filled with several years’ worth of rubbish that will need to be cleaned out and hauled away.
There could be a heiau (an ancient Hawaiian temple), possibly with human remains and archeological artifacts hidden by the foliage. If your client’s new property is declared to be an archeological site, they may find that they own a very expensive piece of land, and not be able to build on it – but they’re still responsible for paying the property taxes!
Maybe there are native plants on the property that are being gathered regularly by Hawaiians – who may be allowed to do so under the PASH provisions (native gathering rights). Will your clients be comfortable with strangers coming onto their property whenever they want? If so, fine. If not, they will want to know about this provision.
Your Buyer client may close escrow to find their new “vacant” property loaded with trash, junk cars, old refrigerators, washers, dryers, etc. upon closing if these paragraphs are not in the contract and enforced. They will then call YOU, their agent to take care of this problem for them.
How do you think the agent on the other side of the transaction will respond when you politely ask them to have the Seller client clean up the mess - after they’ve already spent their commission check, and their client has moved on?
You don’t want to put yourself, your clients, your company or your Broker in that situation.
I hope you’ve found this information helpful! Until next time – Take Good Care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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How to Avoid Problems with Section C7 of the Hawaii Sales Contract, i.e., "Extension of Closing Date"
Paragraph C-7: Extensions.
It is vitally important that agents read this particular paragraph very carefully, and ensure that their clients understand the content & meaning of this paragraph (section C7 of the Hawaii Sales Contract - Deposit, Receipt, Offer, and Acceptance - aka "DROA").
The original intent of this paragraph was to allow Buyer clients the opportunity to extend the closing date, in the event that the Buyer’s loan funding was delayed for reasons beyond their control. This right of extension was also extended to the Seller. This provision is in the contract to protect both Buyer and Seller so that, in the event that either party are not able to complete the transaction by the scheduled closing date, due to reasons beyond their control, then the affected party can extend the closing date without cancelling the transaction.
The problem – and sometimes abuse – occurs when one party extends not for reasons “beyond their control”, but because it may be “inconvenient”* for the client to perform on or before the contract closing date. Therefore, make sure the Buyer is aware (especially if they’ve given their landlord notice and have nowhere to live after the anticipated closing date!) that the Seller can extend out the closing date up to the number of days specified in paragraph C7.
The same goes for your Seller clients - make sure that they’re aware that if they are doing a “back-to-back” closing, or a 1031 Exchange, for example, the transaction could come to a screeching halt if the Buyer exercises their extension rights.
*Who will decide whether the party extended for legitimate reasons “beyond their control” or for mere convenience? The judge in the ensuing lawsuit will! That is not the person you want to invite into your client’s transaction.
I hope this has helped clarify your understanding of this often misunderstood/misinterpreted section of the Hawaii DROA.
Until next time – Take Good Care!
Jay J. Spadinger, REALTOR, BIC, ABR
Hawaii State Educator
Rainbow Properties
Akahi Real Estate Network, LLC
www.rainbowproperties.com
www.jayhawaii.com
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Most Misunderstood?
Provisions C51, C52, C53 of the Hawaii Sales Contract
These three paragraphs seem to cause the most confusion of anything in the DROA (the Hawaii sales contract for real estate), with the possible exception of C-25, which we’ll cover in a future post.
Whether a Buyer or Seller realizes this or not, whenever a Buyer client purchases a property, they are purchasing the property AS IS. This does not relieve the Seller from the obligation of the mandatory disclosure of all pertinent information about the property, or the Buyer’s obligation to have an inspection to determine the condition of the subject property. However, the fact that every property is bought and sold As-Is does not negate the Buyer’s ability to ask that repairs and/or replacements be accomplished by the Seller prior to closing the transaction.
The Seller can obviously respond by countering the offer, and either agreeing to the Buyer’s requests, amending the requests, or deleting the requested repairs/replacements entirely. From that point on, it is a matter of give and take - leading to either a meeting of the minds and the opening of escrow or the deal falls through if agreement cannot be reached.
If Buyer and Seller agree on what will and won’t be completed by both parties prior to closing, then escrow is opened. The Buyer can again request repairs/replacements be made prior to the end of the Buyer’s C-51 Inspection (Due Diligence) Period. It is at this point that the thinking on the part of a lot of REALTORS seems to break down.
The Buyer’s agent needs to educate the Buyer that - the earlier the Buyer presents the Seller with the list of requested repairs/replacements during the C-51 period - the better chance the Seller will respond. NOTE: This necessitates that the Home Inspection be conducted early on.
Many people, REALTORS and clients alike, are not aware of a very important element of the sales contract. THE SELLER DOES NOT HAVE TO RESPOND either verbally or in writing to the Buyer’s request for repairs. The Seller can choose to comply entirely, by accommodating all of the Buyer’s requests, they can agree to perform some of the requested tasks and not others, or they can TOTALLY ignore the request and be well within their rights according the contract.
The key point for the Buyer to be aware of is that - if the Seller refuses the Buyer’s request for repairs/replacements, or totally ignores the Buyer’s request, the Buyer then has three options:
- Obtain the Seller’s written agreement to extend the C-51 Inspection period prior to the stated expiration date
- Cancel the DROA prior to the end of the C-51 period, or
- Accept the property in its initial as is condition.
“If the Buyer fails to make an election in writing within the specified time period, Buyer will have waived this contingency”.
The C-52 paragraph states only that the Seller will maintain the property in the (exact) same condition it was in when the contract entered escrow.
The C-53 paragraph states that the Buyer has an opportunity to inspect the property prior to closing to insure that the property is, in fact, in the same condition as when the contract entered Escrow – nothing more. The Buyer cannot – as a result of the C-53 Inspection – request repairs/replacements be made unless the property has in fact changed since opening Escrow.
This fact makes it imperative that the Buyer perform a thorough C-51 Inspection, preferably accompanied by a Professional Property Inspector, to document all needed repairs/replacements prior to closing.
I hope this has helped clarify your understanding of these often misunderstood/misinterpreted sections of the Hawaii DROA.
Until next time – Take Good Care!
Jay J. Spadinger, REALTOR, BIC, Accredited Buyer Representative, akahi@jayhawaii.com
Hawaii State Educator, Akahi Real Estate Network, LLC www.jayhawaii.com
Broker-in-Charge, Rainbow Properties www.rainbowproperties.com
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