If you are a buyer in the Seattle area, after you have your inspection conducted on a home, you typically have the opportunity to respond or negotiate the original terms of the contract. On the Inspection Response form (known as Form 35R to local agents and other real estate professionals), you have four options:
1) The inspection is approved and the inspection contingency is satisfied…you can now move on to other contingencies (and closing).
2) The inspection is disapproved and the contract is canceled. Any earnest money deposited shall be refunded by escrow to the buyer.
3) The buyer can give notice of additional inspections. General inspectors may find issues with electrical, plumbing, roofing, etc…and let you know that they recommend a specialist to take a look at the issue and perhaps give you a quote on work to be done. In this case, you generally have 5 days for additional inspections.
4) The buyer can simply request for modifications or repairs to be made. In this case, lets say the roof needs to be completely torn off and replaced because it has 3 layers of shingles, several leaks, and is 40 years old. A buyer may request concessions a few ways:
– They could ask that the roof be replaced prior to closing
– They could ask for a price reduction
– They could ask that the sellers pay a portion of their closing costs
– They could request something else be included in the sale that wasn’t previously included (appliances, for example).
The “Inspection Response Form” should always be submitted to escrow in order to not delay your closing.
If escrow does not have this form when they are preparing their HUD Settlement Statement they will not know how to correctly disburse funds. The HUD Settlement Statement will not reflect concessions to the Buyer and/or Seller.
There are many times when the Seller signs first because they are leaving town or some other reason and escrow is still waiting for loan documents to facilitate the Buyer signing. If you make sure to get a copy of the inspection addendum to escrow as soon as possible it will expedite the closing. It will also insure that the information on the HUD Settlement Statement is accurate and helps avoid escrow having to request a second round of signatures.
We all want to close on time with the least amount of stress and this is another helpful tip to make sure this happens!