Selling house septic inspection

[joesxm3]

We are selling step dad's house. We have acceted an offer 10% less than the asking price and about equal to the appraised value.

Next comes the inspection. We are selling "as is" but the buyer can cancel or negotiate based on the inspection results.

The septic is not new but is not showing signs of failing.

If something comes up with the septic, I am thinking to offer to reduce by half or two thirds of the repair price. My logic is that if we redo the septic the value of the house with a brand new septic has to go up by at least a third of the cost.

Does that make sense?

I figure any of the other problems are obvious and should have been accounted for in the original offer.

 

[calmloki]

Yes but - septic is kinda like a roof. if it's working that's all that matters. A 3-4 year old roof, as new, adds nothing to a seller's eyes in my experience. I'd thinking working septic is the same, even if it is newly pumped or drain field repaired.

 

[Tom52]

If I were the buyer I would expect the septic system to pass inspection since the agreed price is about the appraised value. If the system is working, it probably should only need to be pumped out. But, if work is required to the septic system you can always try to share the cost with your purchaser. If they refuse you make the choice to eat the entire cost or look for another buyer.

 

[dirtbiker]

We are selling step dad's house. We have acceted an offer 10% less than the asking price and about equal to the appraised value.

Next comes the inspection. We are selling "as is" but the buyer can cancel or negotiate based on the inspection results.

The septic is not new but is not showing signs of failing.

If something comes up with the septic, I am thinking to offer to reduce by half or two thirds of the repair price. My logic is that if we redo the septic the value of the house with a brand new septic has to go up by at least a third of the cost.

Does that make sense?

I figure any of the other problems are obvious and should have been accounted for in the original offer.

As a buyer, the value of the house is with everything in working order (unless sold as is with deficiencies). Fixing something found on inspection does not increase the value of the house.

This being said, it depends on what the buyer agrees to. We fairly recently bought a house (for a great deal), and on inspection, several things came up. We tried to negotiate, but the seller didn't budge at all, not even a single penny. We almost walked away, but realized that we were still getting a good deal, and that walking away would have been due to our egos, not the financials. We begrudgingly continued with the buying process, and are glad we did. We felt like putzes at the time, but the final sales price was good (figuring in what we needed to fix). Just something to keep in mind...

 

[dirtbiker]

Oh, and appraisals are a joke. They seem to always add up to roughly the agreed-upon sale price...

 

[OldShooter]

An important rule of negotiation is to not negotiate with yourself. Stop. Wait. See what happens. Then consider next steps.

 

[DrRoy]

An important rule of negotiation is to not negotiate with yourself. Stop. Wait. See what happens. Then consider next steps.

+1

 

[joesxm3]

Good advice. I was told not to bid against myself and after the initial low offer I just said "no thanks. Higher number please" and the offer came inb$15,000 higher than what I was thinking.

God willing the septic will be OK.

 

[Car-Guy]

I did something similar with one of the homes I sold. I had the typical inspection done (at buyers/lenders request). The inspector came up a list of minor items that needed to be corrected, which we had fixed. Later the deal fell through. So the next buyer want "their" inspection done. (They would not accept the previous inspection.) The new inspection came up with new list, again, all minor items but still the estimate came out to be about 2k to get them done. (What a racket) I told my agent, to tell them no. I said I'd knock off 2k from the asking price, "if they bought the house" but I wasn't going to keep playing that game. They accepted and the house was sold at 2k below my asking price.

 

[ShokWaveRider]

I did something similar with one of the homes I sold. I had the typical inspection done (at buyers/lenders request). The inspector came up a list of minor items that needed to be corrected, which we had fixed. Later the deal fell through. So the next buyer want "their" inspection done. (They would not accept the previous inspection.) The new inspection came up with new list, again, all minor items but still the estimate came out to be about 2k to get them done. (What a racket) I told my agent, to tell them no. I said I'd knock off 2k from the asking price, "if they bought the house" but I wasn't going to keep playing that game. They accepted and the house was sold at 2k below my asking price.

I agree it is a game, the game is really to give the buyer an out, whether it be a $2k out or a $10k out. In the grand scheme of things, anything up to 1% of the home price is really just noise. When I purchased any of our homes, I have always taken it with the minor issues, and there ALWAYS will be some. Anyone who backs out based on that had second thoughts to start with and were not properly vetted in the first place. I see that being a big problem with RE sales. The agents around here present any offer regardless of qualification, and I do not mean financial, I mean reading the customer, do they really want the home, are they smitten with it, likeliness of backing out, that kind of thing.

I look after our home, and when we sell it, it will be "As Is", I will try to narrow the backout time as much as possible.

 

[dirtbiker]

I agree it is a game, the game is really to give the buyer an out, whether it be a $2k out or a $10k out. In the grand scheme of things, anything up to 1% of the home price is really just noise. When I purchased any of our homes, I have always taken it with the minor issues, and there ALWAYS will be some. Anyone who backs out based on that had second thoughts to start with and were not properly vetted in the first place. I see that being a big problem with RE sales. The agents around here present any offer regardless of qualification, and I do not mean financial, I mean reading the customer, do they really want the home, are they smitten with it, likeliness of backing out, that kind of thing.

I look after our home, and when we sell it, it will be "As Is", I will try to narrow the backout time as much as possible.

The very first home that I owned was small and simple, but I took very good care of it. When I sold it, the inspection came back with literally nothing wrong with it; a perfect home inspection. I couldn't believe it. The buyer still asked for 1% off based on the inspection. I declined, and we moved forward with the sale.

 

[athena53]

Yes but - septic is kinda like a roof. if it's working that's all that matters. A 3-4 year old roof, as new, adds nothing to a seller's eyes in my experience. I'd thinking working septic is the same, even if it is newly pumped or drain field repaired.

I agree- buyers seem more focused on whether the kitchen appliances are the latest "must-have" finish than the more pragmatic and Expensive-to-fix things like the roof and the septic system. When selling houses, I've tended to repair or discount only what the buyers might not have seen on inspection- e.g., termite damage.

When DH and I married, we moved from NJ to KS for my job. My house had sold; DH's hadn't. His was built into the side of a hill with 2 flights of cement steps up to the front door, and that wasn't the main floor- there was another interior flight of steps! VERY hard sell- people loved the listing price but as soon as they saw the steps (which was why it was priced so low) they lost interest. We finally had an interested buyer and it failed the septic tank inspection. Buyers backed out. The work ended up costing $15,000 and I don't think we raised the sale price. We just wanted to be rid of it- I think we carried that mortgage for a year after we moved. Fortunately it was a modest one and DH had $100K equity in the house.

 

[Trailwalker]

When my neighbor's house had that inspection, they discovered a failed septic system. In order to get the deal through, they needed to replace it. It was a pretty big job. The only place to put the new one was uphill in the woods, which required a lift station and the felling of a bunch of big trees to create space.

If they back out, you could sell to someone else, but it's pretty hard to sell a house with a known failed septic system. Is the house worth more with a new septic system? The market will determine that. Best outcome is that it passes the test.

 

[Jimmie]

In my state, the septic tank must be pumped so a proper inspection can be done before a house is sold. The septic company must then file the inspection results with the county. Process can take up to a month before county posts the inspection results and the home closing can be set.

 

[OldShooter]

If I were the buyer I would expect the septic system to pass inspection since the agreed price is about the appraised value. If the system is working, it probably should only need to be pumped out. But, if work is required to the septic system you can always try to share the cost with your purchaser. If they refuse you make the choice to eat the entire cost or look for another buyer.

FWIW in our rural county the code requirements for septic systems have changed a number of times. The bottom line is that a septic system that was installed earlier than just a few years ago will be judged noncompliant. If not rebuilt to the new code prior to a sale, the buyer will have two years to remedy. It has nothing to do with whether the system is "working."

 

[Sunset]

Inspections are a racket in many cases.
Sometimes they are just wrong.

A house for sale, went quick but then the buyers wanted $15K off the price as their inspection said new drainage tile around house was needed to water mark in basement.
I told agent I'd pay full price (below market) no conditions after I checked the house myself.

I bought the house.

The water in the basement was from a clogged gutter that would overflow into the window well and leak into the basement.
I cleaned the gutter and replaced the partly rotten window.

Never had a flood/leak since in over 20 years.

 

[athena53]

Inspections are a racket in many cases.
Sometimes they are just wrong.

Yeah, mine missed signs that he should have noticed that indicated water in the basement during heavy rains, which I found out the hard way. (Floor was freshly painted and there were lines with mineral deposits along the cinderblock walls.) Fortunately I was able to have French drains installed before I sold 7 years later- realtor told me that if I didn't, some prospective buyer would ask for a discount equal to double what it would cost for me to just put them in. Wow. What a difference. It made me wish I'd done it earlier but I'd done it when I changed jobs and got my first annual bonus, which was large enough to cover it.

 

[Tom52]

FWIW in our rural county the code requirements for septic systems have changed a number of times. The bottom line is that a septic system that was installed earlier than just a few years ago will be judged noncompliant. If not rebuilt to the new code prior to a sale, the buyer will have two years to remedy. It has nothing to do with whether the system is "working."

FWIW I have lived in, and sold, 3 different homes over the last 45 years that all had septic systems. The septic system of the first home was 10 years old at time if sale, the second home the septic system was 37 years old at time of sale, and the third home the septic system was 41 years old at time of sale. In all three cases the only requirement was the tank had to be pumped out and then inspected by the county. All three passed inspection and there was no requirement to be rebuilt to a new code. The houses were in two different midwest states. So I am thinking maybe in your location, your statement being true about non-compliant systems being required to be rebuilt to a new code, but is not the case everywhere.

Hopefully, we will find out from the OP whether or not his location requires an update to septic system. In reference to the OP's question, if I was a potential buyer and found out I would be required to upgrade the septic system to a new code within 2 years of purchase, that cost would come off my offer or I would walk away from the deal.

 

[folivier]

Here's how ridiculous parish/county laws can be. Years ago when we sold a weekend house the parish required a septic inspection. Septic systems required an aerator pump. During our ownership the pump needed replacing so we had a plumber replace it. But the pump he put in wasn't the same brand as original. The inspector noted this and said it needed to be replaced with the correct brand. I called a plumber and had him replace the nearly new pump with the correct brand. While talking with him he said the only difference was the name tag. They were the same pump! I asked him if he could just replace the tag....

 

[OldShooter]

... So I am thinking maybe in your location, your statement being true about non-compliant systems being required to be rebuilt to a new code, but is not the case everywhere. ...

Oh, I didn't mean to imply that everyone would run into this. I just wanted to flag the fact that at least in some jurisdictions it is not enough to have a system that is "working fine." There are a couple of factors that I think are influential for our county:

First, it is a large tourist-destination county that claims 1,000 lakes. Understandably they are semi-nuts about protecting the water quality of the lakes. But development (aka homesteading) started over a century ago and began with outhouses placed wherever the land owner chose to place them, including very close to lakeshore. Following this came unregulated and creative home-made septic systems. So the county is playing catch-up trying to clean up a century's worth of stuff. The big things are setback requirements vs any lakeshore and mound system designs for the drain fields. There are also rules on size/adequacy of systems required based on occupancy/number of bedrooms in houses.

Second, it turns out that the county-authorized septic inspectors are typically the contractors who install septic systems. The old rule "Never ask a barber if you need a haircut." almost certainly applies.

 

[skyking1]

An important rule of negotiation is to not negotiate with yourself. Stop. Wait. See what happens. Then consider next steps.

along the same lines, what makes you ( the OP ) think the septic is failing?
The typical pre-sale inspection involves pumping the tank and inspecting the inlet and outlet baffles. That's about it.
If a baffle has fallen off, it can be repaired.

 

[joesxm3]

There is no sign of it failing.

My lawyer was worrying about it while reviewing the offer contract.

It used to be a real problem when I was a young kid, 50 years ago. Around 1990 my stepfather dug new leach fields himself. I guess the root of my worries is based on my opinion that he typically seems to not know how to do things by the book, although he has accomplished a lot like building a shed and a barn.

The realtor tells me not to worry about problems until they happen. The contract says the inspection will be comp!ever by 9/18 which seems like a short time. I guess we will see what happens then.

 

[skyking1]

sure, just letting you know that they do not test nor dig up the leach fields for an inspection.
it is just the tank, the inlet and outlet baffles. The septic pumping company pumps out the tank and writes the report.

 

[frank]

in my state the septic and well have to be inspected before the sale and repaired or replaced as necessary to pass inspection. I saw a house and 5 acres sell a couple years ago and after the auction, the well and septic would not pass inspection. both had to be repaired by the seller.

 

[ERD50]

sure, just letting you know that they do not test nor dig up the leach fields for an inspection.
it is just the tank, the inlet and outlet baffles. The septic pumping company pumps out the tank and writes the report.

Depends on location. Inspections where I had lived involved some probing of the field, I think just to verify it wasn't saturated.

For the well, in addition to a lab test, they verify it can replenish at 5 GPM (tested after some time to allow for emptying the pressure tank and whatever was in the well). This might have been VA loan specific, as was a 'termite' (any wood-eating creature) inspection. Termites aren't all that common here (though carpenter ants are, which it turns out we had, and I had to pay for a few treatments), but I don't think that sort of inspection is routine, but VA required it.

-ERD50