Video: What Does “As Is” Mean in a Real Estate Contract?
Thursday Sep 08th, 2022
What Does “As Is” Mean in a Real Estate Contract?
When searching for a home, you may come across the term “as is”. This term indicates that a buyer must be willing to accept the home exactly as it is – meaning that the seller won’t make any repairs to the property.
While an “as is” clause doesn’t usually appear in a normal real estate transaction, it often appears when a foreclosed property is being sold by a bank. Banks don’t usually see or inspect the foreclosed homes they sell, and, as a result, they aren’t able to provide disclosures about properties they know nothing about.
The “as is” clause protects the bank from being sued by a buyer if major defects come to light.
The buyer can protect themselves by including a home inspection contingency in their sales contract and if the inspection finds costly repairs, the buyer can back out of the sale.
Selling a property “as is” doesn’t relieve the seller from their obligation to disclose any known material facts that could influence the buyer’s decision to buy the home.