Home Inspection Tips

A home inspection can uncover potential problems that can, if left untreated, lead to costly repairs. A buyer should never let the apparent beauty of a home mislead them into thinking that the home may not have significant defects.

For example, some sellers may advertise that they have a “new roof ” when in fact, only the shingles may be new. They may have neglected to inform you that the damaged plywood and old shingles were left underneath the new shingles. The problem is that it could reduce the life expectancy of the roof. This is why mortgage lenders sometimes require an inspection before approving a loan.

When to Get an Inspection

• Without question, an inspection should be done before you close on the purchase and take possession of the home
• There should be a clause in the real‐estate contract that makes the sale of the home contingent upon the inspection
• You should be sure to have an inspection performed in the time‐frame specified in the contract
• If the inspection deadline is not met, you waive your right to recover your earnest money if an
  inspection uncovers major deal‐breaking issues

A reasonable time frame would be within a two‐week period from acceptance of your offer: which is typically at your expense. However, you shouldn’t wait until you have placed an offer on a house before beginning the search for a home inspector.

If you wait until that point, and cannot find an acceptable inspector to schedule in the required time frame, you will only have two choices: go with an inspector that is not their first choice, or risk running past the deadline for the inspection. (This could void any chance of having the seller take care of repairs.) Neither is an acceptable option!

Are Home Inspections Worth the Cost?

The value and necessity of an extensive home inspection cannot be emphasized enough. Many home buyers have attempted to save the $200 – $500 cost of a good inspection, but have spent enormous amounts of money repairing items that any reputable home inspector would have pointed out.

Inspections often disclose defects in the property that could materially affect its safety, livability, or resale value. You should not let anyone not a Realtor®, nor their family or friends, and especially not the home seller—discourage you from having the property thoroughly inspected.

As long as the contract is written with a contingency for an acceptable inspection, any defects in the home must be either repaired, or you may elect to receive monetary compensation to make the repairs. If you are not satisfied, you have the option to cancel the purchase contract.

How to Find the Right Inspector?

Not all home inspectors are equally qualified, and choosing the right inspector is crucial. You have a myriad of resources available in making this decision.A good place to start is with a Realtor®. If you choose your Realtor® wisely, the Realtor® can recommend good, reliable inspectors.

A good tip is to obtain three or four names and addresses of inspectors that the realtors other customers have used, rather than accepting just one recommendation.

• You can also ask friends, family, and co‐workers for referrals.
• You might also call their mortgage lender or their lawyer for recommendations
• Sometimes, you have a friend or family member that is qualified to conduct this service and trust them to do it.
• It is wise, though, not to have this person as the sole inspector. Instead, they should accompany a professional inspector as an additional resource.
• Another option for you is to use a home inspector who is certified by a national home inspection organization. These groups establish professional standards for their members to follow. Inspectors who belong to the organizations listed below have met rigorous testing and experience requirements, and are among the nation’s most qualified professionals in this field.

Professional Home Inspection organizations include:
  American Society of Home Inspectors (ASHI), www.ashi.org
  National Association of Certified Home Inspectors (NACHI), www.nachi.org
  National Association of Home Inspectors, Inc. (NAHI), www.nahi.org

What to Look for in a Home Inspector

Once you have compiled your top two or three choices, you can move on to phone interviews to make your final decision. It is very important to find an inspector who communicates well. Request a sample inspection report first, to ensure that it is easy to read and provides the information you expect. You should look for two key things in reviewing sample inspection reports:

• Does it give the ages of specific systems in the house or just an idea of their current state?
• Does it estimate the cost of repairs and remedies for existing problems?

Many inspectors don’t provide written repair quotes but it is important to know the price range of
potential repairs.

It is advisable to inquire about the exact methods that the inspector uses:

• Do they actually go on the roof or into the crawl space under the house? Some check these areas as a matter of course.
• Others charge extra, and still others will not go closer to the roof than standing in the driveway. They will look up at the roof and jot down notes from there.
• You need to know exactly what you are getting when you pay for an inspection.

Does the inspection company carry any type of liability insurance to cover any damage to the house created by the inspector during his tour, or major defects the home inspector misses? If not, you may want to consider finding a company that does.

How Much Does a Home Inspection Cost?

You shouldn’t hire the cheapest inspector you can find. Better inspectors will typically charge more, and they are usually worth the additional cost. If a lower‐priced inspector misses even one problem that a more expensive—but experienced—inspector would find, then you’ve lost money.

Home inspections can range from $200 to $500

The price will vary depending on:

• The square footage and age of the property, on possible optional services (such as septic, well, and radon testing).
• The individual inspectors or inspection companies’ rates. This is a small expense compared to the large investment of purchasing a home.

Make sure you have gathered

• any property condition disclosures provided by the seller
• a list of any repairs or improvements done on the home
• and potential warranty information before the inspection

The inspector can use this information as a reference point to determine if certain tests should be
performed at an additional expense, based upon the home maintenance records.

Additional testing for radon, asbestos, well‐water contamination, or mold usually costs more than a basic inspection. The home inspector might direct you to someone else for those reports, perhaps to an individual or company that specializes in the inspection of environmental hazards.

Payment is required at the time of service.

You should view this as a cheap insurance policy. Although there may be nothing wrong now, it is for
your protection to make this modest investment.

Who Should Attend the Inspection?

You!

As attending the home inspection will allow you to come away with a better understanding of any potential problems. You will learn a lot about the house in the process. You should be cautious of inspectors and realtors who discourage you from attending the inspection. Any good inspector will want you to attend. If you are working with a Realtor®, then the Realtor® should also be present.

It is ideal if you can request that the homeowner not be present during most of the inspection. It will allow you the freedom to probe and inspect all the details of the home without feeling that you are being invasive of the homeowner’s privacy. If the home owner arrives at the end, it can be helpful, as sometimes they can provide information about the home’s history to which an inspector would not be privy.

The inspection is typically the last time you are allowed in the home prior to closing, so you should take all the time you need to feel comfortable with this major decision.

It may be advisable to bring a camera, video camera, measuring tape, and memo board. Although the inspector will provide a very thorough report, you may have some “non‐ structural notes” that will be helpful to review later.

You should be observant of items that remain with the home such as window treatments, built‐ins, appliances and overall aesthetic condition. You may also observe colors, document door and window locations, and measure rooms to plan for furniture placement.

What to Do During an Inspection

In short, take notes on what the inspector says could be foreseeable problems with the house. The inspector’s job is to find defects that a typical layman may not be able to detect. This is not meant to be a pass/fail type of test. Simply put, an inspector is there, as your representative, to make observations and recommendations based upon the conditions found.

The inspector’s job is to bring to light any important problems with the house. With this information, you might still choose to purchase the house, but will have room to negotiate the price. You can say to the owner, “The inspector says the roof is in poor condition. He estimates it is well over eighteen years old and overdue for replacement.” Such comments can help lower the price during negotiation.

The time frame will vary depending on the number and type of inspections, as well as the size of the home. An inspection typically takes two to four hours, and covers the following areas:

• Mechanical and safety items
• Structural features (like the foundation)
• Plumbing systems
• Heating, cooling, and ventilation systems
• Major appliances
• Roof
• Electrical
• Attic and the exterior of the home, including driveways and fences

What to Expect After the Inspection

The inspector will compile the findings in a typed report and provide it to whoever commissioned the job (usually you). Most companies will deliver this report to you immediately on site or within a few days. You should provide a copy of the report immediately to your attorney and Realtor®.

It is best to keep this report confidential until these representatives have had a chance to decipher the information and advise you on your next move. The seller or seller’s agent may request a copy of this report, but it should not be supplied—not at this time. Your attorney (or agent if attorneys are not used) will provide a copy, along with proper notifications to accompany the report of any items found.

How to Negotiate Repairs?

Your Realtor® or attorney will negotiate any repairs, cash credits, or advise you to walk away if the home inspection reflects too many problems.

See why it’s so important to have a top Realtor®?

This determination will be dependent upon independent contractors’ or exterminators’ estimates to repair the damages highlighted in the report.

The sellers may provide these estimates, and it is advisable to keep them. Your attorney or Realtor® will typically offer referrals of reputable contractors to choose from. There may be a time period allowed in the contract to obtain these estimates, usually ranging from 10 to 14 days.

Access to the home will be allowed to you to conduct the evaluation. You and your agent should accompany the contractor to fully understand the scope of the work potentially needed and answer any questions. Items to have present at this time are the contract for sale, the structural inspection report, and any estimates the seller may have provided as a reference to ensure all questionable items are addressed.

All estimates should be in writing and supplied to your attorney and Realtor®. Unless the property is being purchased in “as‐is” condition, it is common to renegotiate the contract based upon the repair estimates. It will ultimately be up to you to decide if you want to move forward, and what terms are acceptable should there be a major defect. Laws in each state will vary as to what constitutes a “major defect,” based on a set dollar amount in the purchase and sale contract.

If repairs are done prior to closing, you should get another inspection after the problem has been fixed. Then obtain any receipts, work orders and warranties that may apply. If you opt for a credit, the contract may need to be re‐written to reflect these changes. You should discuss the best way to include these concessions with your lender, Realtor®, and attorney. They will advise the best solution that meets your financial needs. All agreements need to be in writing, either by an attorney letter or an executed addendum by all parties.

The goal of this process is to create a win‐win atmosphere. The purchase of a home is an emotional process for both you and seller.

It is human nature that no one wants to “lose” a negotiation.

In the next installment, we are going to discuss buyer mistakes.