Repair credits after a California inspection
The inspection came back with a list. Here is what typically happens next in a California transaction, who is required to do what, and which piece of paper actually changes the deal rather than merely asking for a change.
What the request is, and what it is not
A buyer lists the items they want addressed on the C.A.R. Request for Repair form, and the seller answers on the matching response form. The request itself changes nothing about the contract. Until the seller agrees in writing, the price, the credit and the closing date are all exactly what they were before the inspection.
This is the most common misunderstanding on both sides of a California deal. A buyer who has sent a repair request has not secured anything, and a seller who has received one is not in breach for ignoring it. What creates an obligation is a signed agreement, not a sent request.
Why money is often used instead of the work
A credit avoids the two problems repairs create for a deal on a clock. The first is quality: the buyer inherits work chosen and paid for by someone who will never live there, and disputes about workmanship surface after closing when there is no leverage left. The second is time. Scheduling a contractor, completing the work and producing receipts can easily consume more days than remain before the loan contingency runs out.
A credit has its own constraint that agents on both sides tend to discover late: it involves the lender. Money moving at closing changes the numbers the loan was approved against, and lenders cap what they will allow. A credit agreed between the parties but never run past the lender is a credit that can collapse the financing it was meant to protect.
Which document changes the deal
Once the parties agree, the change is documented. A change to an already-binding purchase agreement is an amendment; material added to or clarifying the transaction is an addendum. Getting this the wrong way round rarely voids anything, but it produces a file that reads confusingly to a lender, an escrow officer or, later, a reviewer.
Whichever is used, the useful test is whether a stranger reading only the contract and the signed change could tell exactly what the money is for, when it is applied, and what happens if the underlying work is never done. If they could not, the document is not finished.
The default clocks a repair conversation runs against, measured from acceptance
| Contingency | Default period in the RPA | Why it matters here |
|---|---|---|
| Investigation of property | 17 days | The inspection, and therefore the repair conversation, normally happens inside this window. |
| Appraisal | 17 days | A credit that changes the numbers can reach the appraised value the loan relies on. |
| Loan | 21 days | The lender has to see any credit. Agreeing one late leaves no room to re-approve. |
Forms this touches
Named so you know which document the conversation ends in. Their text is not reproduced here.
- RR — Request for Repair
- RRRR — Seller Response and Buyer Reply
- AEA — Amendment
- ADM — Addendum
Questions that come up
Does the seller have to respond to a repair request in California?
No. The purchase agreement expressly says the seller is not required to agree or respond to a buyer request. Two things remain the seller’s responsibility regardless: damage occurring after acceptance, and repairs required by law.
Is a repair credit the same as a price reduction?
They are different documents with different effects. A price reduction changes the purchase price, which changes the loan amount and can change the appraisal picture. A credit leaves the price alone and moves money at closing. Lenders treat them differently, which is usually what decides which one a deal uses.
Can repairs be agreed after the investigation period ends?
Parties can agree to almost anything in writing at any point before closing. What ends with the investigation period is the buyer’s contractual leverage — the right to end the deal on the basis of what the inspection found.
Describe the change in plain English
Amendly drafts the California amendment or addendum for your deal from a sentence. You review every line before it goes anywhere.
Draft your first amendmentRelated in this guide
- When a California seller refuses to repair anythingA California seller can decline a repair request, or ignore it. What that leaves the buyer, and what the seller still owes regardless.
- C.A.R. Form RR — Request for RepairWhat the C.A.R. Request for Repair does, and the paragraph of the purchase agreement saying the seller need not answer it at all.
- C.A.R. Form RRRR — the seller responseHow a California seller answers a repair request, why a partial agreement is not an agreement, and what turns a response into a change to the contract.
- Reducing the price mid-escrow in CaliforniaRenegotiating a California price mid-escrow, why the appraisal contingency runs on its own clock, and what a change does to the loan.
Where this comes from
This page describes how California residential transactions typically work. It is general information, not legal advice, and it is not a substitute for an attorney on a specific deal. Amendly is not a law firm. Forms are named and described here; their text is not reproduced. Amendly is not affiliated with or endorsed by the California Association of REALTORS® or any state agency.