Real Estate

The repair cap in the real estate contract

What is a repair cap?

How much should I ask for?


After a buyer gets an offer on a house accepted, the next step is to get a home inspection. The home inspector will check the roof and the foundation and all mechanical features in between. It seems like every house has something that needs to be repaired. Sometimes the buyer may have noticed some repairs but most of the time the home inspector uncovers defects in the house.

The repair cap is a dollar amount in repairs that the seller has agreed to repair. The amount of repairs that the inspector uncovers may be more or less than the repair cap. If the repairs are less than the repair cap, the seller will repair all items listen on a TRR form (Treatment, Repair, & Replacement). If the repairs are more than the repair cap, then there are a few different scenarios that could happen.

1.         The buyer decides which repairs are most important to them and ask the seller to repair those items up to the dollar amount.

2.         The buyer asks the seller to repair items that cost more than the repair cap and the seller agrees to make repairs. Contract continues as normal.

3.         The buyer asks the seller to repair items that cost more than the repair cap and the seller refuses to make certain repairs. This is sometimes called the second negotiation.  If buyer and seller cannot agree, the contract becomes null and void. If they can reach an agreement, then the contract continues as normal.


The repair cap is listed in the contract to protect both buyer and seller. It may be that the seller cannot afford to make the repairs beyond the repair cap, or the buyer may decide after seeing the inspection report that they do not want to purchase the house especially if there are many repairs and the seller is not willing or able to make necessary repairs.

Once the seller knows the list of repairs they are required to disclose this information to future buyers; however, the seller may still decide to not repair more than the repair cap amount.

So how much should a buyer put in the contract for a repair cap. This is always a tough question, since it is unknown what the inspector will find prior to the inspection. I typically see $500-$1000 in contracts. If the house is newer probably less is fine, if the house is older or very large, then maybe more. I suggest you visually inspect the roof, windows, look for cracks, turn lights on and off and maybe turn the sink on and look under the sink. Does it look like the property has been maintained? If you see major issues like missing shingles or broken windows, ask the seller to repair these items outside of the repair cap. This way you don’t find yourself outside of a repair cap with a seller not willing to make a large repair and you out the money of the inspection when you knew going in that there was a large repair that you were not willing to make was required.

If you have questions regarding real estate, please feel free to call me at 405-213-2992 or visit my website at

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