4 ms·

That's not a completely fair example, though, for a number of reasons. If you think there's an honest chance that a $1500 independent review could turn up some

That's not a completely fair example, though, for a number of reasons. If you think there's an honest chance that a $1500 independent review could turn up something that would make you turn down the deal and try to find another, do you then expect to have another $1500 review done? What expectation should you, a non-expert in doing this kind of calculation, have about the total cost of having independent reviews done? Also, $1500/$1million sounds tiny, but nobody who thinks they can't afford a $1500 review buys a $1million house in cash; they get a mortgage and expect to pay $4.5k/month, and people in general don't save (or have the ability to save) as much as I do/would. So it's $1500/$4500 in the immediate future of having to make your first payment, on top of closing costs, etc., for benefit that is already unclear to a non-expert. And by definition we're talking about a non-expert, because that's why they would have the need to hire a lawyer to do an independent review. Anyway, it's not that I necessarily think lawyers are that expensive across the board, but the existence of that perception shouldn't be very confusing. A non-expert doesn't have the tools to accurately put a value on expert services.

kazinator 8y ago
Another scenario: say you have this $1500 review and it uncovers issues. You want the house anyway and try to negotiate the price down. Oops, the house goes to the next bidder who didn't bother with such a review. Basically, all you can do with the review is to "know what you're getting into".
- pnw_hazor 8y ago
  In residential deal, the legal review comes after the offer has been accepted and the title co has provided a title commitment and proposed title insurance policy but before closing. Depending on the discovered issues, if any, your offer may be voidable or in a worse case you will have to forgo your earnest money. Still better than losing the whole house years later because of something like an incorrectly handled DIY divorce.
- bradknowles 8y ago
  Depending on the jurisdiction, anything discovered in a detailed inspection of this sort will have to be disclosed to any future buyers. So, in that case, it would be to the best interest of the seller to reduce their asking price and/or fix the major problems that were found, so that they no longer have to carry this legal burden going forward. Yes, this happened to me and my wife (she's the lawyer in the family), and this resulted in us getting over $12,000 cut off the purchase price of our house, in addition to getting a number of major problems fixed before the deal actually went through. IANAL myself, and I can't make any claims that anyone else will necessarily benefit in the same way, but that detailed inspection of the house-to-be-bought can be worth 10x the cost you pay for it -- or more.

kazinator 8y ago

Another scenario: say you have this $1500 review and it uncovers issues. You want the house anyway and try to negotiate the price down. Oops, the house goes to the next bidder who didn't bother with such a review. Basically, all you can do with the review is to "know what you're getting into".

pnw_hazor 8y ago
In residential deal, the legal review comes after the offer has been accepted and the title co has provided a title commitment and proposed title insurance policy but before closing. Depending on the discovered issues, if any, your offer may be voidable or in a worse case you will have to forgo your earnest money. Still better than losing the whole house years later because of something like an incorrectly handled DIY divorce.
bradknowles 8y ago
Depending on the jurisdiction, anything discovered in a detailed inspection of this sort will have to be disclosed to any future buyers. So, in that case, it would be to the best interest of the seller to reduce their asking price and/or fix the major problems that were found, so that they no longer have to carry this legal burden going forward. Yes, this happened to me and my wife (she's the lawyer in the family), and this resulted in us getting over $12,000 cut off the purchase price of our house, in addition to getting a number of major problems fixed before the deal actually went through. IANAL myself, and I can't make any claims that anyone else will necessarily benefit in the same way, but that detailed inspection of the house-to-be-bought can be worth 10x the cost you pay for it -- or more.