Real estate closing question?

Question

We are in the last part of escrow and the termite report came back saying there were a positive i.d. of them.

Who pays for the spraying and tenting? Does that get done before we get the house?

This is our first house, and very excited and nervous? What happens from here?

Answer 1

Who pays and when is a subject for negotiation, and may depend on your state laws. Your contract presumably says "subject to inspection and termite report." Well, now you know why it is there!

You can (with the advice of your lawyer and/or agent):

1. Walk away from the sale and get your earnest money or deposit back.

2. Counter-offer based on what you expect it will cost for you to fix the problem. This lowers your sale price, but you need to have money to pay for it so check with your loan officer. (Get estimates for repairs, spraying, and future spraying)

3. Request that seller put enough funds in escrow to fix the problem. This keeps your same sale price, which is helpful if you are financing. (Get estimates)

3. Counter requiring that the seller fix it before closing, and reduce the price you are offering based on termite presence and future costs.

Answer 2

The question of who should pay depends on local customs. Were you present when the inspection was done, was it done by a licensed inspector?    Where is your REALTOR®, do you have one?  That's what they are there for, to help you through the buying process, and answer all your questions.

Answer 3

There is not really a clear cut answer to this. You certainly have to bring this to the buyers attention through your broker (if you have one).

One thing is for sure, termites can absolutely ruin a property. They will continue to fester and grow until something is done about it. Hopefully the damage is somewhat accessible and the damaged wood can be replaced. This is not a pest problem, this is a significant property damage problem, same as if the house got flooded.

Therefore, I would not accept this one "as is." You need to either have the sellers fix it and make sure that the termite report comes back negative before closing, or get a couple of estimates showing what the total damage will cost you.

If the sellers won't fix it, you have a few options. You can either walk away from the deal (you should get your earnest money back) or you can negotiate them down on the price.

This is definitely not what you want to hear if you are excited about purchasing your first home. Even in the best case scenario, this will be a setback of at least a week or two.

There is a chance that the termite company is just trying to make a dollar as well, and your estimates will come back to show that the damage is minimal and work will not be expensive or time consuming.

Good Luck!

Answer 4

It depends.  "Positive ID of them" doesn't tell you anything.

You need to know:

1.  Is the house currently infested.

2.  Was it a PAST infestation...and just evidence is remaining.

3.  Is their any DAMAGE as a result of any present or past infestation.

4.  Has the house ever been treated for termite damage?

If the house has been treated for termite damage (and spraying doesn't take care of it..you have to bore down around the foundation), and the infestation is recent, then I would require the sellers to repair and do a full re-treatment, and then hand it over to you so you can do the maintenance per the contract.

However, if the house has never been treated, and there is active damage, no way would I close on that house b/c they could have been there for a very, very long time.

If it was PAST infestation and no damage noted, then it's probably been previously repaired, and most houses that are over 20 to 30 years will show signs of past infestation.

Answer 5

The seller is supposed to pay for the spraying and you don't get the house until proof that it was done. Don't let the seller con you into paying.