Most real estate deals go through with little or no issues along the way. Everything has been checked off and all is good to go. You’re busy packing up your current residence and excited for the big move-in date! Then BOOM…a huge storm hits and your newly purchased home is now engulfed in 3 feet of water! Now what?
- Stay or go
We all know flooding is a serious catastrophe. Especially when it’s your new home that’s been damaged prior to your move-in date, your closing date. It’s a complicated situation and in some instances, the damage done to the home can be so extreme that the buyer will back out of the deal and demand their deposit back or ask for a revised (lowered) sale price. When this happens, it is understood that the buyer and seller, along with both lawyers and real estate agents, will have to work through the details. Ultimately deciding whether the property can be fully repaired in time to save the transaction
- Check your agreement
A well-thought out purchase agreement should have some type of specifics stating what should happen if an unexpected disaster occurs causing damage to the property prior to closing date. If your realtor has done this, the document is worth its weight in gold. In some areas known for example, flooding, mud slides, earthquakes etc., these special clauses give the buyer an important layer of protection.
- Seller agrees to repair
It will be imperative that your realtor outline in a revised contract that both the buyer and the seller agree to move forward with the transaction. However, you agree to moving forward only if the total damage costs are less than a certain percent of the sale price (usually 5%). The seller will be on the hook for getting the repairs done and must show proof of the repairs. The responsibility falls on the seller as they are the ones who retain ownership of the property until the keys are turned over to the buyers.
- Inspection time
It is essential to have another home inspection to see if the damage is more widespread than it seems. You as a buyer can not allow the sellers to falsify the situation and try to make it less than what the damage really is. Water damage is dangerous and is the culprit for mold, foundation and structural damage to a home. If not dealt with properly, the home can even shift and sink which comprises the safety of the home overall. Having an inspection will also help figure out how expensive the repairs will be, which in turn will influence the decision of whether or not to proceed with the deal altogether.
You are spending a lot of your hard earned money on this property as your forever home. It needs to be solid and safe. If you find the sellers aren’t cooperating with the repairs, then you might be best advised to walk away from the deal. You don’t want to see your investment go down the drain due to shady people. Count on us, Ares Law to help protect you and your home or cottage purchase. We are experienced real estate lawyers who understand Bracebridge and the Greater Muskoka region well. We can help you just as we’ve helped many clients throughout the years. Speak to us and we can give you expert advice on how to handle your situation. Call us today at 1-705-645-8743.
