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Wednesday, March 24, 2010

"Speak Now or Forever Hold Your Peace"

The Real Estate Walk-Thru

OK, so it's not as dramatic as the point in the wedding ceremony where the officiating clergy asks the assembled guests to "speak now or forever hold your peace."

But functionally, the walk-thru performed by the Buyer just before closing plays much the same role in a residential real estate deal.

That's because the standard for recovery from a Seller past the point of closing requires that the Buyer prove: 1) that the problem existed at the time of closing; and 2) that the Seller knew about it -- or should have.

So, the furnace that worked at closing, but failed the next day?

Yup, the Buyer's obligation.

Ditto for any number of maintenance-related items (appliances, wet basements, etc.) where timing, as the saying goes, is everything.


Of course, the Buyers have a strong case for pursuing a Seller who clearly knew of a problem at the time of sale.

It may just be a Realtor version of an urban myth, but the classic example is the Buyer who has a sewer backup soon after closing (a very unpleasant, and memorable, problem to have!).

The new homeowner calls Roto Rooter, which promptly dispatches a repairman.

On the way into the basement, the repairman -- who tellingly needs no directions -- tells the new owners, "I told the Smith's they needed to have those pipes looked at before it backed up again."

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