Yikes! Termites! And Due Diligence is Over!

Lately, we have seen multiple active termite and termite damage issues arise. Because caveat emptor, or Buyer Beware, is still the law in Georgia, buyers have the duty to protect themselves, including against termites and resulting damage. ​

The most common way to protect Buyers from repair concerns is using a Due Diligence Period (DDP) and having a house inspected within that period, but termite inspections are often left until after the Due Diligence Period is over.  Although it is the buyer’s duty to inspect for termites, many contracts throw that duty over to the seller in the Special Stipulations, writing that the seller is to provide a Termite Inspection Report.  If the seller is not required to do so before the DDP is over and then termite issues are discovered, the Buyer can be in a very tough situation indeed.

Consider several ways to resolve the situation:

1. Have the buyer obtain the termite inspection report as a part of the buyer’s due diligence with (or without) reimbursement for the report from the seller at closing.  
   
2. Have the seller provide the report within ______days of the Binding Agreement Date (within the DDP) or, if not timely provided, the DDP will be extended by ______ days after the termite report is provided to the buyer.
   
3. Provide that the Seller will provide the report and will be responsible for treatment and repairs (structural and/or cosmetic).  If using this method, remember to allow for an extension to the closing date for treatment or repair - and allow for termination by the buyer if the seller refuses.
   

The most expedient method, of course, is the get the termite report within the Due Diligence period.  Nobody wants to see a termite report right before closing that reveals an issue.  Remember, if the buyer discovers termite issues too late and the seller is not required to treat or to repair, caveat emptor may become a very expensive life lesson!  

PS:  We can always help with contract language!

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