Having a final walk through prior to going to settlement on a house is customary in Northern Virginia real estate, and I recommend that clients do this once the seller has moved all their stuff out of the house. Basically, the objective is to make sure that the house is in the same condition as when you agreed to buy it, that anything included in the contract is still there (like the fridge), and to make sure anything agreed to during the home inspection has been done.
Home builder contracts will specify that the buyer will do a walk through inspection a week or two prior to settlement, and then schedule a quick meeting prior to settlement to check off any items previously noted. For incomplete items, a post settlement “punch-list” will be written up to keep all parties informed as to what still has to be completed.
The new Regional Sales Contract that we use in Northern Virginia now has language saying that the Purchaser may do a final inspection five days before the settlement (paragraph 8). The Home Inspection Addendum also specifically mentions the Final Walk Through inspection.
One last check on the house
Clients are typically eager to set up this inspection to take another look at the house, and here are some specific points:
- Make sure the Seller has moved completely out
- Run appliances through a complete cycle
- Know that the house conveys in “broom clean” condition, free of trash
- There is a “walk through” form that you will use as a checklist
- If the seller is to remain post-settlement for an agreed upon time, do your walk through with the understanding that their security deposit is the liquid remedy for the final walk through inspection.
During one walk through inspection in Vienna, my clients ran the dishwasher and quickly discovered that it was leaking on the kitchen floor. Although I quickly shut it off and mopped up 90% of the water, it was an item that was noted on the form that they brought to the settlement.
Now, this wasn’t an opportunity for my clients to void the contract or refuse to close, but it was an opportunity to meet with the sellers and negotiate a reasonable solution. In this case the seller gave the purchasers an additional credit with the full understanding that the buyers would use the money to buy a new dishwasher. Essentially, to take it “as-is”.
On the other hand, if the purchasers showed up for the final walk through and found the seller still there, or in bed, or in the shower with no intent of moving then there would be a contract issue. I can’t even imagine that happening although I’m sure it has!
I like to meet clients at a home for the final walk through inspection very close to the actual settlement time. For example, if the settlement is scheduled for 11:00 then we would meet at 9:00 at the house to ensure everything is intact one last time before signing on the dotted line.
If there is an issue then it can be handled on the form in a few ways:
- Seller will correct noted discrepancies without an escrow.
- Seller shall credit Purchaser $__________ .
- Repairs are to be made and paid for from funds held in escrow by the Settlement Agent. Escrow funds are/are not the limit of the Seller’s liability.
But do not worry, in most cases everything is working smoothly as both the seller and purchaser are excited to complete the transaction.