Real Estate “How-To” Articles
Unlike the general public, I don’t read articles like “How to Stay on Top of Your Home Closing” (Angie’s List) to learn anything new (or, at least I hope I don’t).
Rather, I read the articles to see how sound their advice to consumers is.
On that score, the Angie’s List piece rates a good-but-not-great “B.”
Hits & Misses
Pluses: Angie’s List smartly advises prospective home Buyers to avoid making (other) major purchases prior to closing (it may impair their qualifying for a mortgage); and cautions against having the same Realtor represent both Buyer and Seller in the same transaction (a type of “dual agency” — illegal in several states, but which Minnesota allows if it’s disclosed and both parties agree).
But I also caught some potentially dangerous flubs, at least as residential real estate is practiced in Minnesota.
Here are the excerpts, with my commentary in italics immediately after:
Angie’s List: “The short window to do a home inspection opens when a would-be Buyer submits an offer on a home.”
Ross Kaplan: Wrong. The clock for the Buyer to do their inspection doesn’t turn on until the Buyer and Seller have entered into a fully executed Purchase Agreement. Called “Final Acceptance,” the date is filled in at the end of the PA, and helps defines how long the Buyer has to physically inspect the home (along with line 25. of the Inspection Addendum).
Angie’s List: “Only contractors, not inspectors, can suggest fixes and provide estimates when an inspection uncovers problems.”
Ross Kaplan: Yes and no. When the inspection uncovers a material defect costing thousands of dollars to repair, it’s appropriate to get estimates from licensed contractors (and extend the Inspection timetable to allow for that).
However, good inspectors can and do routinely estimate projects — and opine as to whether there IS a major problem — thereby avoiding the expense of hiring an electrician, plumber, roofer, etc. prematurely (or at all).
As they say, “never ask a barber if you need a haircut.”
Angie’s List: “We were 10 days overdue on the closing date and the Seller of the house decided he was going to start accepting new offers.”
Ross Kaplan: Unh-uh. A home owner can only sell their home to one Buyer at a time. While Buyer #1 appears to be in breach of contract by not timely closing, the Buyer and Seller are still governed by the Purchase Agreement and whatever remedies it provides.
Before the Seller can move on to another Buyer, they must have the first Purchase Agreement cancelled (Note: technically, the Seller may accept a backup offer that is conditioned upon the first Purchase Agreement cancelling. However, most Buyers will want to wait for the dust to settle before entering into such a contract — or at least stipulate a maximum waiting period).
See, “Get Me Out of the Deal! Statutory Cancellation for Beginners.”
Fortunately, the various real estate “how-to” articles all offer sound advice when it comes to the first and most important matter they discuss.
Namely, be sure to use a good, experienced agent to help you buy or sell a home.