As I’m writing this post the wind is blowing crazy (again), dust is flying everywhere and maybe, just maybe we’ll get some rain. It’s been a pretty busy monsoon season in AZ this year! I noticed several downed trees last week while headed to an inspection in one of my favorite Chandler communities, Valencia.
I was visiting my Dentist last week…(shout out to Dr. Cory Rauch and his amazing staff at Rauch Family Dentistry)…anyway, we were chatting about the storm and he mentioned a patient of his who lost a large tree in the backyard. It happens, right? The thing that got my attention was that this patient’s house was under contract. So what happens when you’re selling your Phoenix area home and there is damage to your property while it’s under contract? There are 3 sections of the purchase contract that this scenario falls under:
Disclosure: The first section is on pg. 4 under Disclosure.
“The seller shall IMMEDIATELY notify Buyer of any changes to in the premises…”
Pretty self explanatory, right? You have to let the Buyer know. This may require that you make repairs or it may allow the Buyer the opportunity to cancel the contract.
Seller Warranties: The next section is the Seller Warranties paragraph also on pg 4.
“Seller warrants and shall maintain and repair the Premises so that…the premises…will be in substantially the same condition as on the date of the contract acceptance.”
Did you catch that? SUBSTANTIALLY the same condition. What if a HUGE tree dies? What if wind takes out the roof? What if? What if? The seller is on the hook for making it SUBSTANTIALLY the same. That doesn’t mean that the seller gets to replace the huge shade tree with a new 10-gallon tree. Or just remove it altogether. SUBSTANTIALLY the same.
Risk of Loss: The final section on pg. 9 gives the seller a little reprieve…maybe.
“If there is any loss or damage to the premises between the date of Contract acceptance and COE (close of escrow) or possession, whichever is earlier, by reason of fire, vandalism, flood, earthquake or act of God, the risk of loss shall be on the Seller, provided, however, that if the cost of repairing such loss or damage would exceed 10% of the purchase price, either Seller or Buyer may elect to cancel the Contract.”
Again we see that the seller is on the hook for any repairs UNLESS the damages exceed 10% of the sales price. If that’s the case EITHER party may elect to cancel the contract.
Some of these sections are fairly overlooked in the contract (surprisingly by many agents, too). Just make sure you know how the contract applies to you and what your obligations are if a haboob or some other issue strikes!
If you’re thinking of selling your Phoenix area home, we’d love the opportunity to earn your business. For a comparative market analysis feel free to call/text 480.420.4441 or email me at [email protected]