I recently put one of my listings in escrow and the parties agreed that the property will be sold in “AS IS” condition.  The buyer’s agent sent a list of items to be repaired after the home inspection.  I reminded him that the property would be sold in “as is” condition as agreed to by the parties.  Then, the day before closing, after the final walk thru, the buyer’s agent stated that the buyer refused to sign the closing docs until certain items were taken care of prior to closing.  And, that’s when I explained what “as is” condition means.

When looking through property listings and the term “as is” appears, some people see it as a warning. Others see it as an opportunity. That might get you wondering, what exactly does “as is” mean?

Taking this a step further, according to realtor.com, the term "as is" is rarely tacked on a property that's perfect and move-in ready. On the contrary, "as is" homes are often in disrepair, because the sellers can't afford to fix these flaws (which would help them sell the home for a higher price). Or else, the house may have been through foreclosure and is now owned by a bank, or the seller died and left the house to inheritors who have little idea what could be wrong with it.

The “as-is” language in most contracts puts a heavy weight on a buyer’s shoulders.  Despite the fact that the sellers are required to disclose known latent defects, it is up to the buyer to ascertain the condition of the property.  If the buyer discovers additional information about the house during the inspection period, then the buyer has the right not to proceed with the purchase.  Simply put, the seller needs to disclose, and the buyer needs to inspect.

In the contract referenced above, the term meant that the owner was selling the home without making any repairs or improvements.  Additionally, the seller had no intentions of giving the buyer any credits to fund any repairs.