Doing Your Due Diligence

Several of the terms of the contract are designed to give buyers time to dig in to the home and make sure it is a property that they really want to buy.


If you have elected a home inspection (which I strongly suggest you do) then you will need to call around to get it arranged within the time frame detailed in the contract, usually 10-15 days. Many buyers ask about doing inspections prior to going under contract, but without a signed agreement the seller would be free to accept another offer while you are spending time and money on an inspector. For this reason we carve out the contingency periods as a term of your offer that will allow you to complete your inspections and proceed with the sale if the house is satisfactory, negotiate with the seller if there are deficiencies, or terminate the sale and get your deposit money back if the house is unacceptable. Don’t be surprised if a few things show up in your inspection, especially if you are purchasing a “used” house.

The inspection is your opportunity to get to know what you are buying with the guidance of a building professional. Typical inspections include the home inspection, a pest inspection and a radon inspection. Depending on the circumstances you might also have a video scope of the sewer line, an energy audit, a survey, water or septic test, a review of the zoning or property restrictions, and more. If you are buying a condo you will also have time to review the Homeowner’s Association (HOA) Documents.

Remember inspections are for your protection and you are free to use any certified home inspector you choose.


If you are getting a loan your lender will want to do an appraisal. The appraisal is to determine if the home is worth the price you are paying, and if they should give you the money to buy the home. The appraiser is also responsible for reviewing the home and making sure it is in a condition worthy of a loan. (FHA and VA loan appraisals are more strict on the condition of the home than Conventional loans)

Occasionally the lender may ask for repairs to be done in order to agree to do the loan, or the insurance company may require repairs in order to issue insurance. In both cases you will have the right to ask the seller to make those repairs, which they may or may not agree to, and you may choose to terminate the deal if they won’t fix them.

The appraisal is an opinion of value stating that the home is worth what you are buying it for. If the appraisal comes in lower than the sale price then the bank will only lender you a percentage of that value, not a percentage of your contract price. If you elected an appraisal contingency you may choose to ask the seller to reduce the price to the appraised value or to terminate the deal. You may also choose to bring additional money to close to make up the difference between the value and the agreed upon price.

With all these steps, and a few others, specific timelines are outlined in your sales contract. It’s important to pay attention to those dates so you don’t forfeit any of your rights in the sales process.