Negotiating After the Inspection in Mentor: What's Fair

Yes, you can negotiate after an inspection. Your contract gives you a window to do it. What you ask for, and how you ask, decides whether the seller says yes. If you're buying in Mentor, here's how I'd approach it.

Ask for the right things

Focus on items that affect safety, structure or the major systems. Don't hand the seller a list of 50 small issues. A short, defensible list gets taken seriously. A long one gets a no, and you lose goodwill you may need later in the deal, when the appraisal comes back or the closing date needs to move.

A good rule: if you'd fix it yourself in your first year without thinking twice, leave it off the list.

A repair threshold keeps you competitive

One tool I share with buyers is a repair threshold, such as agreeing not to request items under $3,000 total. That tells the seller up front you'll only raise the major issues. I also tell buyers they don't need to waive the inspection to be competitive. Keeping it while limiting requests to the roof, structure, heating and cooling, electrical, plumbing and mold is a reasonable middle path.

If you used a threshold in your offer, stick to it now. Sellers remember what you promised, and keeping your word is part of what gets the rest of the deal done.

Repair or credit?

A repair request lets the seller control the work and the quality. A credit gives you the control. In most cases a credit or price reduction is easier to manage, because you hire your own contractor and avoid arguments over workmanship. Repairs make more sense for items a lender or appraiser will require, since those have to be done before closing.

If you do ask for repairs, ask for receipts and a licensed contractor where it matters, and plan to check the work at your final walk-through.

Credits have limits too. Your loan program may cap how much the seller can contribute, and a lender won't let a credit pay for more than your actual closing costs. Ask your lender how much room you have before you settle on a number, so you don't negotiate a credit you can't fully use. If the credit you need is bigger than what's allowed, a price reduction may be the better ask.

Know your leverage

In a market where several buyers want the house, your leverage is lower and a long list can cost you the deal. In a slower market you have more room. Look at how long the house has been listed, whether the price has already come down, and how many other offers there were. Your agent can usually find out more about the seller's situation, which tells you how hard to push. A seller who has already bought their next house thinks very differently from one who's in no hurry.

The appraisal can change the conversation

Another option I talk about is an appraisal gap pledge, for example covering up to $5,000 if the appraisal comes in short, sized to what you and your lender are comfortable with. If you made one earlier, remember it when you plan what to ask for now. Your total cash exposure is the gap pledge plus any repairs you agree to handle yourself, and both come out of the same pocket.

For sellers reading this

If a buyer asks for a reasonable credit, compare it to the cost and time of relisting. A house that falls out of contract can come back to the market with questions attached, and the next buyer's inspector will probably find the same things. A fair credit now is often cheaper than starting over.

Know when to walk

Negotiating isn't the same as winning at all costs. If the seller refuses to address a safety or structural item and you can't live with it, your contract usually gives you a way out within the inspection period, and that's a better outcome than owning a problem. Have your agent confirm the exact terms and dates in your contract before the window closes, and keep copies of every request and response.

How to word the request

Attach the inspector's report pages, name each item, and say whether you want a repair or a credit. If you want a credit, back the number with a contractor's estimate whenever you can. Keep the tone factual, not emotional. And check your contract for the number of days the seller has to respond, because missing a window on either side can limit your options.

If you're buying in Mentor and want help deciding what's worth asking for, schedule a time with me or someone on our team at 21mike.com.

Mike Ferrante
The Mike Team at LPT Realty
www.21mike.com
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