What To Do When A Home Is Damaged Between Signing And Closing

By Heather Rose

You’ve toured the house one last time before closing, arranged your finances, made moving arrangements and are all ready to close the deal and begin a new chapter of your life in a new home. Normally, home buyers wait a couple of months between signing the contract on a new home and when they are expected to take possession of the home, meaning physically move into the home.

While that time period shouldn’t be thought of as two months for something to go wrong, what is a home buyer to do if they find that, between the signing of the contract and closing, their new home has become damaged? A hole in the wall, scraped-up floors or a stained carpet – it could be anything – that definitely wasn’t there when you signed the contract.

In cases like this, the seller is at fault because the buyer signed the contract agreeing to purchase the house “as is”, but “as is” at the time of signing – not for the foreseeable future.

One problem with this situation is that it can be hard to prove the damage wasn’t there initially. A thorough inspection of the home if one way to avoid this issue, and this inspection can include photographs and the moving around of larger furniture that could be concealing any damage. Once that checks out, you’ll at least have some ammunition to help prove your case. This type of inspection and permission to do so can be added to the contract.

Quite often, in situations such as this, the only recourse for the buyer is through legal channels such as your lawyer or small claims court.

Other more significant issues can arise between signing and closing, like a fire that causes substantial damage. If the home is uninhabitable or trashed, the buyer can cancel and walk away or use the seller’s insurance money. If the damage is just costly, the buyer can claim for the cost of repairs.  Each situation is different and it is important to involve your legal counsel in these types of situations.

Heather Rose is a Toronto based Journalist, who is a regular contributor to the Muddy York Real Estate Blog.  Heather website is located at heatherroseportfolio.squarespace.com.

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