The consequences of writing ambiguous home purchase agreements.
There is no greater impediment to the advancement of knowledge than the ambiguity of words - Thomas Reid.
Just because the online listing says ALL APPLIANCES STAY! unless you actually ask for them when writing up your offer to buy the home don't be surprised if those same appliances are not there on closing day.
To minimize post-closing surprises and buyer disappointment, when writing up an offer on a home, the buyer and their real estate agent need to be crystal clear as to what they are asking for and what they expect from the sellers. This also extends to the other aspects of the purchase agreement and the home-buying process.
When buying a home, verbal agreements are meaningless, everything needs to be in writing and signed off on to be legally binding. It needs to be written clearly and concisely so that there is no confusion as to what is being agreed to. Don't give the seller wiggle room to get out of honoring the contract or the opportunity to interpret it to their advantage.
Assume nothing! A small dose of paranoia helps.
Also if you end up in a legal dispute with the seller and you have a clearly written and unambiguous contract, the judge is going to have a lot easier job deciding which way to rule. But hopefully, it never comes to that.
Here are some examples of the consequences of not writing clear and concise home purchase offers.
You thought you were getting all the appliances including the freezer in the basement.
As mentioned in the introduction, the glossy flyer for the property might say that all the stainless steel appliances go with the home but if the buyer doesn't check off the boxes for each of those appliances in their offer then legally speaking the seller is totally entitled to walk away with them before closing.
The buyer needs to specify each individual appliance that they want to be included with the home. And that includes any additional appliances like the freezers in the garage or basement or the wine cooler fridge under the counter or that hot tub on the deck. Here's the section of the NWMLS form used for the Seattle area and Washington State home sales where the buyer indicates which appliances they want (different states will have different versions of this):
Similarly, if the listing says all the attached TVs stay, then you need to state that you want each of those TVs and specify the rooms in which they are located. In general, things that are plumbed into the home or nailed into the walls are considered part of the home and you don't specify items such as light fixtures. However, in the Seattle area at least, the hot tub is an exception and the seller is within their rights to take that with them if you don't ask for it in the contract.
When viewing homes that you are strongly considering making an offer on, write down all the appliances you want to be included. It can be hard to remember stuff when you get back home and after viewing five other properties.
A quick story for you: once I heard about a buyer who had an offer accepted on a home with a state-of-the-art, touch-screen, connected-to-the-internet refrigerator in the kitchen. They checked the box on the contract for "refrigerator". When the buyer went to the home the day after closing, yes the kitchen still had a fridge but it was the fridge that had been sitting in the garage! The hi-tech one was gone.
The buyer would probably be hard-pressed to get an attorney to prove the case that the seller didn't honor the contract since the kitchen did have a refrigerator at closing and the buyer didn't specify WHICH refrigerator. Yes, the seller pulled a fast one and probably knew they were not honoring the good intent of the contract but legally speaking, they were within the requirements of the contract.
Normally this doesn't happen but if you want to be 100% certain that you are getting what you think you are getting, especially when it comes to some specialized and expensive appliance, then maybe specify the name and brand of the appliance and its location.
Not getting the inspection repairs done as you expected.
This is a part of the contract and home buying process where it is critically important to be crystal clear as to exactly what you are requesting from the seller.
Say the buyer does a home inspection and discovers that the roof is on its last legs, is leaking, and needs to be replaced immediately. The buyer and their Realtor write up an inspection response to the seller with the following wording:
The Seller agrees to replace the roof before closing.
The seller agrees to this and the buyer is delighted that they will be getting a new roof.
Two weeks later the buyer is driving past the home and up there on the roof is the homeowner with his buddy Bob, laying a new roof directly on top of the old one.
The buyer is flabbergasted and fuming but according to the terms of the contract, the seller is honoring the purchase agreement.
What the buyer should have done:
As part of their allowed inspection process, the agent should have advised the buyer to bring a roofing contractor to the home to get a quote on replacing the roof. With that quote in hand, a much better inspection response to the seller would have been something like this:
The Seller shall, at the seller's expense, remove the existing roof and replace it with a new 30-year roof. The roof is to be installed by ABC Roofing with a transferable warranty as detailed in the attached quote. All repairs must be completed within 5 days of closing and the Seller shall provide a copy of the paid receipt to the Buyer prior to closing.
If the seller agrees, then they have to use ABC Roofing company and the roof has to be installed as detailed in the quote. The buyer is controlling the process: the roofing contractor, the quality of the roof, and that it will be installed by a professional licensed contractor.
If you leave it up to the seller they are going to go with the cheapest alternative that meets the terms of the contract. And who can blame them?
The home is not clean when you get the keys.
Most purchase agreements will have a section stating that the owner will clean the home before closing.
The problem is: what's the definition of CLEAN?
The buyer envisions floors so clean that they can eat their dinner off them while the seller is thinking that they just need to get their stuff out of the home and give it a quick one over with the vacuum.
The condition of the home when the buyer first views the property should be a good indication as to the condition it will likely be in a closing. If the home is spotless and Q-Tip clean at the open house and the sellers look like they take good care of the place then most likely the bars we had a really clean home a closing. But never assume that will be the case.
If the buyer wants to guarantee that they will get a clean home on closing day then they should specify in the contract that the sellers will hire professional cleaners to clean the home before closing and to provide a receipt as proof.
Seller junk you just don't want.
While it's good to get all the things you asked for you, at the same time you do not want to end up with all the junk in the garage including all those old tires plus gallons of old paint and cleaning products.
Most purchase agreements will state that the owner needs to move all their personal property from the home before closing but the buyer needs to be proactive to ensure that they actually do so.
The potential problem is: what's the definition of PERSONAL PROPERTY?
The seller will definitely agree that all their furniture, sports equipment, and power tools are personal items, but they can sometimes need a little nudge to be reminded that those old cans of paint in the garage are their personal property too. The contract verbiage seems to leave wiggle room for the seller to just leave stuff/junk and the buyer can choose to dispose of it:
One way the buyer can avoid inheriting unwanted items is, for example, to include the following wording in the inspection response:
The Seller shall remove all personal items from the garage, the attic space under the stairs, and the backyard including all paint, cleaning products, and tires before closing.
Many sellers scramble to get out of their homes before closing and it's not uncommon that they leave buyer gifts in the garage and then it's too late to get rid of them. So, make sure to do a final walkthrough of the home before closing to make sure the seller has taken care of these items
How to avoid ambiguous contracts:
- Write clear and concise offers so that both the buyer and seller know exactly what is expected of each party.
- Hire an experienced Realtor, particularly one who has good negotiation skills and knows how to write a solid purchase offer.
- The buyer should read what they are signing because what you are signing has consequences. Does the language in the contract clearly convey what you are requesting? If not, don't sign it until it has been rewritten. Don't assume your agent is a contracts whiz.
- Get quotes from professional contractors to control how post-inspection repairs are done.
Yes, doing a final walkthrough is important, but if the contract was ambiguous in the first place, then the walkthrough won't save you.
In conclusion regarding the Consequences of Writing Ambigious Home Purchase Agreements: writing a clear and concise offer on a home house removes ambiguity as to what is expected from both the buyer and the seller. They protect both parties and greatly reduce the chance of any potential disputes occurring before closing. Words have consequences (and checking boxes), so be careful which ones you choose to use. So if you want to make sure you get those shiny new stainless steel appliances at closing, you know what to do!
This article was written by Seattle and Eastside Realtor Conor MacEvilly who has been in the business since 2008. I hope you enjoyed the post and thanks for visiting my website. If you have any questions about Puget Sounds area residential real estate feel free to contact me. I'm happy to help. My direct line (cell) is 206-349-8477.