Hurricane Irma is gone, but the effects of her wrath are still being felt all over South Florida. One group impacted are people who have an active contract to buy or sell their homes.
Even if your closing date was initially a few days before Irma hit, you no doubt found that it was impossible to get homeownerโs insurance. So if you were taking a mortgage, you couldnโt close. Thatโs because insurance companies freeze new policies once a storm takes aim.
Now that the storm has passed, youโll need to take certain steps to move forward with the deal.
1) Get a written extension of the contract closing date, if necessary. The standard real estate contract provides for a short delay after things return to normal, a clause known as โforce majeure.โ If the delay will last for more than 30 days, either the buyer or seller can cancel the contract without incurring any financial penalties. If youโre still interested in preserving the deal but think the delay in your closing date may be significant, youโll want your Realtor or attorney to get all sides to agree in writing to extend the date.
2) Have a new, professional inspection. Youโll need to wait for power and water to come back on before you can have the home re-inspected. Itโs something that every buyer should absolutely do. Even if the original inspection took place the week before the storm, youโll want to have it repeated, because the home is obviously at risk of being in a different condition now. (If youโre taking a mortgage, your lender will require that one is done.)
3) Determine who pays for repairs. In many contracts, the seller must return the house to the condition it in when the buyer signed the contract. But sometimes, itโs the buyer who has to pay. Youโll want your lawyer to check out the โrisk of lossโ section of your contract and let you know who is responsible.
4) Renegotiate if necessary. If the home has been changed by the storm, you may need to renegotiate the price of the sale. However, the house must be inhabitable condition before any lender will agree to a mortgage.
5) Stay in touch with your lender. According to local media, many lenders seem to be honoring their interest-rate guarantees that technically expired when your closing date got moved. Still, youโll want to contact your mortgage broker or lender to see specifically how the storm affected the terms of your loan.
If you would like to speak with an experienced real estate attorney, contact the Law Office of Gary Landau for a FREE legal consultation at 954-979-6566 or by email. Attorney Gary Landau personally returns all calls and emails to him.