It's spring, which means along with the daffodils, you will see "for sale" signs popping up in yards. Whether buying or selling this spring, I want you to be prepared. That means understanding the market and how to make or solicit competitive offer terms. One term you may not know is a pass/fail inspection.
You have seen houses listed for sale "as is", meaning the seller has no intention of making repairs. You may also have heard that some buyers are waiving their right to inspect or promising not to ask for any repairs. This can be risky for both buyers and sellers. To address this, the 2022 Tennessee residential purchase and sale agreement has a new option for buyers which protects their inspection privileges while assuring sellers that the buyers are sincere when they say they will not ask for repairs. This is a "pass/fail" inspection. If no material defects are found during inspections, the buyer moves forward with the purchase. If a material defect of concern to the buyer is found, the buyer cannot ask for repairs but can terminate the agreement. The relevant text is:
"Buyer waives the option to request items to be repaired and/or replaced...Buyer retains the right to perform Buyer’s Inspections and to timely furnish Seller with a list of written specified objections and immediately terminate this Agreement...or accept the Property in its present AS IS condition..."
I never recommend that buyers waive inspections just to make their offer more competitive. This new option is a less risky way to make your offer more appealing. If you are planning to buy this spring, give me a call to discuss how I can help you negotiate a successful purchase.
