Wednesday, June 15, 2011

Make sure that 2-year Roof Certification is actually valid for 24 months!

I have blogged about roof certifications in the past...a "roof cert" is generally something that is agreed to by buyer and seller at during the initial contract negotiations. It is very common for the seller to agree to provide a 2 or 3 year "Roof Certification." Many agents will include this in the residential purchase agreement (aka, the offer). A certification generally involves a licensed roofing contractor inspecting the roof, recommending/performing repairs, and giving a written guarantee that the roof will not leak for 2 or 3 years. Common repairs include sealing around roof vents, installing flashing, replacing shingles, etc. The certification itself usually costs $250 - $400 (repairs are extra), depending on the age and pre-existing condition of the roof. If the buyer and seller negotiate a 2-year roof certification into a purchase agreement -- the 2-year roof certification should be valid for 24 months, starting at the close of escrow. Not rocket science, right?

I recently had the experience where a listing agent and seller tried to make my buyer client accept a 2-year roof certification that was valid for 21-months. Huh?

So my buyer clients got into contract on a really cute Woodlake house during the first week of May...among other things, we negotiated that the seller was to provide a 2-year roof certification at the close of escrow. Our expected close date was June 9th. A few days prior to closing, the listing agent emailed me a copy of the roof certification document from the roofing contractor. The roof certification was dated 3/17/11, and was valid for 2 years from the date of issuance. Yes, it was indeed a 2-year roof certification, but it was already nearly 3 months old. So basically they were trying to pass off a 21-month guarantee to my clients.

I contacted the listing agent and let him know this was not acceptable. He claimed that they did provide a 2-year roof certification as promised. I pushed back that they were providing a 21-month roof certification that did not meet the terms of the purchase contract, and that if the seller wanted to provide that particular roof certification, in one of the counter offers should have been the following phrase: "Buyer shall accept roof certification dated 3/17/11 provided by Marin Roofing." That resonated with the listing agent. He got it.

Fortunately, the solution turned out to be an easy one: the roofing contractor issued a revised 2-year roof certification for free, dated in June, because the roof was in decent shape. The seller was happy that he did not have to pay an additional fee, and the buyer was happy to have the full 24-months of coverage.

The moral of the story -- if you are a seller who has a previously issued roof certification that you wish to provide a buyer, you MUST indicate that during your contract negotiations. If presented at that point in time in a counter offer, that will be acceptable to many buyers and will not cause a stir at the end of the transaction. If you are a buyer, and the seller has agreed to provide a 2-year roof certification, be sure that you are indeed getting that 2-year roof certification for the full 24-months the seller has contractually agreed to...

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