How to address Buyer receiving cash in lieu of repairs?
Question: How do I address a Buyer receiving money back in lieu of repairs?
Answer: See form 60 which is the Resolution of Due Diligence Addendum. A Buyer and Seller can agree upon any of the 3 options given under sections 1, 2 or 3. If a Seller does not want to make repairs then section 1 or 2 applies:
1. [ ] CLOSING COSTS. Seller and Buyer agree that Buyer accepts the Property as provided in Sections 10.2 and 10.3 of the REPC. Seller shall contribute at Settlement the amount of $ to be applied at Buyer’s discretion toward any or all of the following: (a) a permanent reduction, or temporary reduction, in the mortgage loan interest rate; (b) mortgage financing costs; (c) closing costs; and (d) Prepaids/Escrows. Any unused portion of Seller’s contribution may, at Buyer’s option, be used to reduce the Purchase Price. If in a prior addendum to the REPC Seller has agreed to pay an amount toward Buyer’s closing costs (the “Prior Contribution”), the amount shown in this Section 1 above, shall be in addition to the Prior Contribution.
Or section 2 is also an option: 2. [ ] PURCHASE PRICE REDUCTION. Seller and Buyer agree that Buyer accepts the Property as provided in Sections 10.2 and 10.3 of the REPC and that the Purchase Price shall be reduced and that the new Purchase Price is $_________________.
Of course if this issue arises after Due Diligence, you could still use a normal Addendum to address this. Make sure of course that it's approved by Lender and becomes part of the contract!