Delaware Agents Doing Business in Pennsylvania

There are five places in the standard form Pennsylvania contract where there is a choice between two different options on how to handle the contingency: the property inspection; the wood infestation inspection; the radon inspection; the water inspection; and the sewer/septic inspection. When the contract is prepared, the buyer must choose the option that will apply to each contingency. Below is a discussion of the options.

 Option 1, is a buyer oriented choice. In the event that there is a problem or condition discovered during property inspection, sewer inspection, termite inspection, radon test or water test that was not excluded in the sales agreement, the buyer will have several choices. The buyer’s first option will be to accept the property with the problem or condition and release the seller from any responsibility for the condition.  The buyer’s second option will be to terminate the agreement by written notice to the seller, with all deposit monies returned to the buyer. If the buyer does not choose to accept the property or terminate the agreement the buyer may enter in to a mutually acceptable agreement with the seller regarding the problem or condition.  The agreement may make any arrangement that is acceptable to both parties.  It could be a plan for how to correct the condition, an escrow to correct the condition after settlement or a credit to the purchase price for the condition.  These are merely suggestions, this list is not exclusive. The goal is to make sure that the buyer is satisfied with the condition of the property they are receiving and the seller is satisfied with the cost of repairs that they must bear.  

Option 2 provides a more rigid framework for the parties to follow in the event a problem or condition is discovered.  As under option 1 the buyer will have the choice to accept the property with the problem or condition and release the seller from any responsibility for the condition.  If the buyer does not wish to accept the property with the problem or condition the buyer must forward a copy of the report showing the problem or condition to the seller. The buyer must include written proposals of how to remedy the problem or condition. Once the seller receives the report showing the condition, the seller will have several choices.  Within 7 days of receiving the report from the buyer the seller must notify the buyer of their choice to satisfy the buyer’s proposal, credit the buyer with the costs to complete the proposal or not satisfy or credit.  If the seller agrees to satisfy the terms of buyers proposal or credit at settlement costs for the condition the buyer agrees to release the seller from liability under paragraph 27.  If the seller has chosen not to satisfy the buyer’s proposal or credit at settlement the buyer may accept the property and release and the seller or terminate the contract by written notice to the seller with a return of all deposit monies. The buyer and seller may still enter in to a mutually acceptable agreement for repairs and/or credits at settlement.  Be aware that under this option time is important. If the buyer does not terminate this agreement by written notice to Seller within that time, Buyer will automatically accept the property and agree to release.

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