[youtube_video] 4WTFX7Z_mGI [/youtube_video]
Video Transcription
Aloha, this is George Krischke with Honolulu Hi 5.
Buyers are always worried, what happens to my deposit? If I change my mind, will I get my deposit back? In Hawaii, the standard real estate purchase contract provides that the buyer’s initial deposit is fully refundable as long as the buyer cancels the purchase contract during the inspection contingency time period. That is paragraph “J-1” in the purchase contract. The home inspection contingency time period quite often is between maybe 10 to 15 days. That contingency time period gives the buyer the opportunity to inspect the home thoroughly with a professional home inspector. If the inspection results are not satisfactory to the buyer, the buyer can cancel.
Make sure you cancel within the inspection contingency time period. Now, a purchase contract has other contingencies, so there may be other opportunities to cancel the contract if the buyer is not satisfied with some other contingencies. The inspection contingency is the big one, between 10 and 15 days from the acceptance date.
With brand new construction developments, high rise condominium buildings that are being built, the time frames are a little different. The buyer has the right to review the final public report for 30 days after they receive it. That is the time period for them to cancel. If they cancel after that, after those 30 days, the deposit might be at risk. So make sure with a new construction project, if you want to change your mind and walk away, cancel within the 30 day review period of the final public report.
That’s it for today, thanks for watching. ~Aloha.
What can sellers do to stop buyers from tying up a property from buyers that just play games and cancel at the end of J-1? Could sellers shorten J-1 period to say 10 days or less?
Aloha Bettye, Yes, you may shorten the J-1 home inspection contingency time period in Hawaii’s Purchase Contract by countering ‘before’ you accept the Purchase Contract. J-1 is only as long, as both Buyer and Seller agree to it. Once in escrow, convincing the Buyer at that time to shorten J-1 will be a difficult task. Hope that helps. ~ Mahalo & Aloha
George Krischke thank you. Could you give the typical range of J-1 (low 7 days – high 21 days) for a Single family home? Sound a standard range?