A recent incident in the real estate market has raised questions about the responsibilities of buyers and sellers when it comes to insurance guarantees. In this case, a home caught fire before the sale was finalized, leaving the buyer wondering if they could demand an insurance guarantee from the seller.
The situation occurred in Ontario, Canada, where a home was under contract to be sold. However, before the sale could be completed, the home suffered significant damage due to a fire. This left the buyer in a difficult position, as they were unsure if they could still go through with the purchase or if they could demand an insurance guarantee from the seller.
According to real estate lawyer, Mark Weisleder, the answer to this question depends on the terms of the agreement between the buyer and seller. In most cases, the agreement will include a clause stating that the seller is responsible for maintaining insurance on the property until the sale is finalized. This means that if any damage occurs before the sale closes, the seller is responsible for covering the costs.
However, if the agreement does not include such a clause, the buyer may still have some options. Weisleder suggests that the buyer could potentially negotiate with the seller to include an insurance guarantee as a condition of the sale. This would ensure that the buyer is protected in case of any unforeseen damage to the property before the sale is completed.
It is also important to note that in some cases, the buyer may be able to back out of the sale altogether if the damage is significant enough. This would depend on the specific circumstances and the terms of the agreement.
In this particular case, the buyer may have some leverage in negotiating an insurance guarantee, as the damage to the property was significant. However, it is ultimately up to the buyer and seller to come to an agreement that is satisfactory for both parties.
While the situation may seem complicated, it is important for both buyers and sellers to carefully review and understand the terms of their agreement when it comes to insurance guarantees. In the event of any damage to the property before the sale is finalized, it is crucial for both parties to communicate and come to a resolution that is fair and reasonable.
