With recent changes to the Virginia Residential Real Estate Contract (the “Contract”), this topic is ripe for treatment, both old and new.

The Contract provides an opportunity for a Buyer to conduct a final walk-through inspection(s) of the property within 7 days prior to settlement.  The purpose of this inspection is essentially twofold:

One, to make sure that the property is being conveyed in substantially the same condition as on some prior predetermined measuring date (date of offer, date of home inspection or other – note that if no date is checked, the Contract defaults to date of offer).  When walk-through issues come up in this regard, resolution can be tricky to the extent that the language “substantially the same condition” is less than clear and can be understood differently by reasonable minds.  

Two, to confirm that the Seller has repaired or remediated any negotiated home inspection items.  Note that the Contract uses a parenthetical “s” on the end of “inspection” clearly indicating that a Buyer may conduct more than one. More than one walk-through may want to be utilized in situations where there were numerous agreed upon repairs and the Buyer wishes to get an early indication on the status of those repairs prior to settlement rather than be surprised the day before or day of, which is when most walk-throughs are conducted.  

The January 1, 2022 changes limit walk-through inspection access to just the Buyer and broker, unless the Seller agreed to home inspection contingency repairs and remediation, in which case the Buyer may be accompanied by a licensed, professional inspector. 

In the event of a walk-through issue, there are a few possible resolutions. One, the parties may agree that the Seller will repair/remediate the issues.  This can occur before settlement, if there is time, or after settlement.  Two, the Seller may agree to a credit in lieu of repairs/remediation. Three, the parties may agree to an escrow for repairs.  Importantly, both a credit and escrow must be approved by the Buyer’s lender, with a credit being more likely to receive approval.  Lastly, the Buyer may proceed to closing and accept the property in its present condition or pursue the Seller legally after closing for a possible breach of contract (i.e., not conveying the property in substantially the same condition or not completing home inspection repairs). No matter the resolution, it is far better to be pragmatic than principled in these moments. Most walk-through issues are minor in comparison to the overall scope and cost of the transaction.  

In the event there is a Post Settlement Occupancy Agreement, it is important that the Buyer still conduct a walk-through inspection prior to settlement rather than rely on the walk-through after the Seller vacates the property, which only covers the time period from Settlement to the date the Seller vacates.