BIC TIP #1215: Turn Me On and Light My Fire

Come on, baby, light my fire. Or at least light the pilot light. In this BIC TIP, Stephen Long tackles a question that lands on broker-in-charge desks every season: what are the seller’s obligations for utilities under the Offer to Purchase and Contract? The short answer is that the seller needs to turn on and maintain the current utilities so the buyer can do their investigations and inspections.

Utilities On, Inspections Go

The buyer’s due diligence period is when inspectors, appraisers, and contractors come through the property. None of that works well in a house with no power, no water, or a cold furnace. That is why the contract places the responsibility on the seller to have existing utilities connected and working.

A home inspector cannot evaluate a water heater that is not running. A buyer cannot make an informed decision about a system nobody could test.

The Pilot Light Problem

The question Stephen hears most often is about gas logs and pilot lights in gas appliances. Here is the rule of thumb: if the gas service is there and the appliance is there, the seller’s obligation is to have the gas connected and the pilot light lit so the buyer’s inspectors can do their job.

A vacant house where the gas was shut off months ago is a classic trouble spot. Catch it early, not the day before the inspection.

Set the Expectation at the Listing Appointment

The best time to solve this problem is before it exists. At the listing appointment, tell your seller plainly: you will need to maintain utilities through closing, keep the pilot lights on, and keep the property insured. Sellers who hear it early are far less likely to be surprised later.

Stephen also reminds sellers that maintaining insurance through closing is part of the package. An uninsured, unheated house is a risk nobody wants.

The Practical Takeaway

Listing agents: build utilities into your listing conversation and your checklist. Power, water, gas, and pilot lights should all be on and maintained through closing, along with insurance. Do that, and the buyer can conduct inspections on schedule, and your transaction keeps its momentum. If a unique situation comes up, check with your broker-in-charge.