In today's real estate market - the words "AS IS" are used a lot. But what does it really mean to your clients?
For Buyers it means that they should:
- still do a home inspection,
- fill out the BINSR (Buyer Inspection Seller Response) forms,
- whenever agreeing to the words "AS IS" - to sign the AS IS addendum's and make sure it is incorporated into the purchase contract and explained carefully
So what is a Buyer agreeing to under "AS IS" terms? That the premise is being sold in it's existing condition and the Buyer is waiving rights to three things:
- Seller warranties
- That the premise is fit for any particular use.
However, this does not relieve the Seller from disclosing any know issues and defects with the property. (There are exceptions with bank owned properties and special addendum's under this circumstance.) Even in a situation where a Seller lived in the property at one time and it has been a rental, there should be limited disclosures.
On the Seller side, it's important for Sellers to know that an AS IS addendum does not mean that a Buyer cannot ask for repairs. AS IS also does not remove a Seller completely from any responsibility to make certain repairs to the home in order for title to transfer and or for financing reasons.
When agreeing to purchase an AS IS home, inspect the property thoroughly.