One of the most important phases of buying real estate in Ocean City MD and the surrounding areas are the property inspections. In most situations your are going to want to have inspections performed on the property you are pursuing to ensure it is sound structurally and that all of the mechanical systems and appliances are in working order. The cost for inspections for most averaged sized Ocean City area properties will be around $300. This is pretty inexpensive "peace of mind" insurance considering the overall cost of these homes, condos and town homes. There are two types of home inspection contingencies that can be made part of the contract of sale. The first is your standard home inspection contingency and the other is an "AS IS" inspection contingency. Each of these provides a contingency and related protections for a home inspection, however each handles the results of the inspection differently.
Standard Home Inspection
Your standard home inspection contingency is included in the agreement of sale and is made part of the contract on a separate addendum. The first part of the addendum determines the time frame for when the inspections on the property will be performed, based off of the date of contract acceptance. Typically this time frame is 10 to 15 days from the point which both buyer and seller have signed the contract. The inspections are done right away so that in the event there is a problem that can not be solved you as the Buyer are not wasting your time and the Seller's property is not off of the market for a prolonged period. These time frames are negotiable and can be structured based on your schedule, contract time table and your comfort level.
The next part of the home inspection addendum outlines the specific inspections that you will be having performed. In a majority of property transactions the only inspection that is performed is a mechanical and structural inspection. This inspection will cover the entire structure including the roof, foundation, walls, doors, windows, etc. Additionally they will check all of the mechanical systems including the HVAC, electric and plumbing as well as any related components. Finally all of the appliances, fireplaces and any other relevant items will be inspected.
In the event that there are any other inspections that you would like to have performed such as mold, well and septic, termite, etc. we will outline them in this section and they will all need to be performed in the time frames we set forth in the contract. If there are any unique features of the home such as pools, boat lifts, etc. that you would like to have inspected we will need to set up individual inspections for these items as they are not covered in your typical home inspection.
Once we have determined the inspections that you would like to have performed I will schedule all of them for you. You are more than welcome to attend and I encourage my clients to do so when possible. In the event that you can not attend I will go to the inspections and personally oversee them and any issues that may arise. This way we will know exactly what we are dealing with and I can arrange for contractors to come out, determine what the solution is and provide us with a quote that we can then use to negotiate with. The home inspectors that I use prepare detailed reports with descriptions and photos that clearly outline any issues that arise, which they will email to you immediately after the inspection is complete.
Once we have the results back we will compile a list of any items that you want addressed and submit them to the Seller. The Seller can then either agree to fix all of the items, provide you with a monetary credit to address the issues, agree to remedy some but not all of the problems or refuse to address any of the issues. The Seller's response will largely be dictated by the overall structure of the contract of sale. Once we have the Seller's response the ball will be back in your court and whether we proceed or not will be completely up to you. In the event that you are not satisfied with the Seller's response and we can not get it worked out I will get you released from the contract, your deposit will be returned to you and you can move on to pursue another property. In the event that there are major problems that cause you to no longer be interested in the property we can terminate the contract based off of that and you do not have to give the Seller the opportunity to remedy the items.
AS IS with Inspections
"AS IS" property inspections recognize that the property is being sold in its as is condition, however reserves the right for a Buyer to perform an inspection. In the event that the Buyer is not satisfied with the results of the inspection they have the option to terminate the contract. "AS IS" inspection contingencies are typically used when purchasing short sales or foreclosures in Ocean City MD and the surrounding areas. For short sales the Seller is not in a financial position to make any repairs and the bank approving the sale will not allow them. Bank owned and foreclosure properties are listed and sold by the bank in their "AS IS" condition, which is factored into their below market listing prices. Additionally, some Sellers with aggressive listing prices will list their properties "AS IS" so that a potential Buyer knows what they are getting into.
When the offer is submitted on these properties an "AS IS" inspection addendum is included. Time frames are designated as in the scenario above, however we do not have to identify which inspections we are performing and we can arrange inspections for any items that you want checked. Once we have the inspection results back you will need to weigh them and the related costs against the overall deal that you secured on the property. In the event you are happy with everything, we move forward. If the results are not to your satisfaction then we terminate the deal and move on to pursue another property. In some situations, though they are very rare, if the problems are significant and it is something that the bank would have to fix in order to sell the property we can get them addressed in one form or another. This would be for major issues such as mold or inoperable mechanical systems, they will not fix minor or cosmetic items.
In the grand scheme of things inspections for the property you are purchasing are relatively inexpensive and will save you potential headaches down the road. They are performed to ensure that everything in the property you are buying is in working order when you take possession of the property. More importantly they give you protection in the event there is something major wrong with the property that you are not comfortable, regardless of whether it was fixed or not.