ShouldI let a buyer perform work on my property before closing?
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ShouldI let a buyer perform work on my property before closing?
I am in contract with a buyer and he needs a HUD inspection. Should I allow this buyer to pay and install windows in my house before he buys itand has not even shown me a commitment letter yet or an appraisal report
Asked on February 9, 2011 under Real Estate Law, New York
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
There are ways to do this safely, such as by having an agreement between you and the prospective buyer that he is installing the windows at his cost and will not receive any credit, payment, or price reduction; that he is liable for any and all damage done in the process; that he needs to put up some additional money as security (in the event of damage; he can get his back if there is none); that he will use a licensed and insured contractor and provide evidence of insurance; that the work done does not give him any claim or interest in the home or guarantee a sale; that if the sale does not go through either you keep the windows free and clear or at most he gets the materials cost back (depends on what you negotiage); that you have to approve the windows, contractor, and costs ahead of time; etc. Basically, he needs to foot all risks.
However, you should also make sure that you are certain of the bona fides before doing anything. By definition, you'll be giving him access to your home; if he were criminal minded, this would be an opportunity to steal from you or use your home in some sort of a scam, at least for as long as the work is going on.
Alternately, if the windows would be a good thing for you to have in the home, including if this sale falls through, you could agree that *you* will install them and if the buyer buys the home, will pay an extra $XXX for their cost. That keeps you in control.
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