One crucial aspect of the home-buying process that often goes overlooked is sewer inspection.
This vital step provides valuable insight into the condition of a property’s sewer system, which can reveal issues such as blockages, root intrusion, cracks, and other damages that may lead to costly repairs and potential health and environmental hazards. It’s important to note that while older homes are especially susceptible to sewer problems (sewer lines are known to collapse), no home is immune.
The Importance of Sewer Inspections
Sewer inspections are essential for determining the condition of a home’s sewer system.
Homebuyers who neglect to include sewer inspection as part of their due diligence may face unexpected expenses and complications down the road. By conducting a thorough sewer inspection, prospective homeowners can make better decisions about their investment, protect themselves from unforeseen problems, and ensure that their new home’s sewage system is functioning efficiently and safely.
Holdbacks
Holdbacks are a valuable tool for ensuring that necessary repairs or upgrades are completed before closing the deal.
If a sewer inspection reveals significant issues, a buyer may request a holdback from the seller. This means that a portion of the purchase price is held in escrow until the necessary work is completed.
Holdbacks can protect buyers by ensuring that they do not have to pay for all of the costly repairs on top of their new home purchase. Additionally, they provide a financial incentive for sellers to address any issues promptly, as the seller will not receive the full purchase price until the work is done.
No Duty to Disclose
Sellers have no legal duty to disclose information about the condition of their property’s sewer system.
This means that potential buyers may not be aware of any issues unless they request a sewer inspection. By encouraging your clients to have the sewer scoped during the inspection review, you are helping them make a more informed decision about their purchase.
Municipality Contribution
In some instances, the responsibility for maintaining and repairing sewer lines is divided between the property owner and the municipality.
The property owner is typically responsible for the portion of the sewer line that runs within their lot, while the municipality is responsible for the portion outside the lot line, usually extending to the main sewer line.
When a sewer line collapses or becomes clogged with tree roots, it may be necessary to determine which party is responsible for the portion of the line that is affected.
If the issue lies outside of the lot line, property owners may be able to seek financial assistance or contribution from the municipality to address the problem. This can help alleviate the financial burden of the repair or replacement and ensure that the sewer system functions properly.
The Role of Real Estate Attorneys
Real estate attorneys can play a crucial role in facilitating a smooth transaction and protecting your clients’ interests. They can help:
- Draft and review purchase agreements, including provisions related to sewer inspections and holdbacks.
- Negotiate with the seller’s attorney to address any issues identified during the sewer inspection and determine the terms of the holdback.
- Advise on the legal implications of no duty to disclose and ensure that your clients understand their rights and obligations.
- Review escrow documents and confirm that the holdback funds are properly managed and disbursed upon completion of the agreed-upon repairs.
When homebuyers incorporate sewer inspections into their property assessment process, they are better equipped to make choices, safeguarding themselves from unexpected expenses and potential issues that may arise in the future.
