What Do Home Inspection Results Mean for Your Contract?
Inspecting the home you want to buy is an essential part of the process, and it often determines whether or not you can close on the sale. But how do these inspection results affect your contract? What do they mean? Are you protected from any hidden problems that are discovered during the inspection?
What is a Home Inspection?
Home inspections are a routine part of the real estate process. They allow you to identify any problems with the home before closing. The main thing you want from your home inspection is peace-of-mind – knowing everything about it will be as represented.
As a buyer, you can choose a home inspector licensed by the state to come and examine the property. The home inspection cost can vary, but it will typically be a few hundred dollars.
You will know whether any potential issues might cause you to stop and rethink buying the property by getting a home inspection. There is no obligation to get an inspection, but it truly is in your best interest.
The Home Inspection Contingency Clause
The home inspection clause in your purchase contract is designed to protect you. If there are significant problems with a house, they’ll be found, and you can cancel. If a home inspection isn’t part of your contract, talk to your real estate agent about adding one—and make sure it includes an interior check as well as an exterior walk-through. You want all major problems found before you sign on that dotted line.
The inspection clause added to the purchase contract will ensure that the obligation to purchase the home is contingent on the inspection findings. The clause should specify terms for both the buyer and the seller.
What Does the Home Inspector Do?
A home inspector examines various home features, like the foundations, structures, roofs, HVAC, plumbing, and electrical, and provides a written report with the details.
A home inspection can generally take two to four hours, but it could take more time, depending on the size of the house. Once the home inspector is done with the physical inspection, they might take a couple of days to provide the written report. Potential buyers should go to the inspection themselves to explore their new home more and ask more questions while they’re there. You’ll be able to see the home and form an opinion of it much better this way.
Choosing the Right Home Inspector
You will find that many people and companies are offering this service. When making your choice, you first need to ensure that they are licensed and experienced. Sometimes, your real estate agent or mortgage broker might have suggestions on who you should choose. Since they work in the field each day, they likely have some good referral options for you.
The Difference Between Standard Home Inspections and Warranty Inspections
The value of a home inspection typically lies in information, not in inspection per se. That is, your home inspector will inform you of any problems they observe, but they can’t act as your agent in negotiating or fixing those problems. Generally speaking, there are two types of inspections: standard and warranty. Standard inspections occur before closing; disclosures must include results but aren’t usually negotiated between buyer and seller. Warranty inspections come with an attached service contract, so if something isn’t up to snuff when it comes time for buyers to move in, it gets fixed under that contract. Warranty and third-party (termite/pest) inspection reports also detail findings that fall below certain thresholds agreed upon at contract signing.
Actions Buyers Can Take Following an Inspection
If you find out during an inspection that something is not quite right with your home, it’s possible to take action before closing on your purchase. It’s important to remember that repairs come at a cost, and there’s no guarantee that sellers will pay for any of them. You may negotiate these repairs as part of your contract, and your closing attorney can assist with these negotiations.
Sellers are obligated by law to share certain information about their homes before selling them. For example, sellers must let buyers know about major structural problems like termite infestations or asbestos exposure. They also need to meet present building codes and provide a property’s clear title (ownership).
What If There Is a Problem?
Although it’s not something you want to hear, there is a chance that when you get your home inspection, the inspector finds a problem. What are you supposed to do if this happens? You have a few options in most cases.
You can withdraw from the transaction when the inspection fails, as long as you have that contingency in your purchase agreement. You could also negotiate and request that repairs be made to the property. The seller would be responsible for making these repairs. Of course, it doesn’t mean that they will. They may decide that they no longer want to sell the house to you.
Other times, the seller might reduce the price to fix the property yourself. Whether you want to take that option or not will be up to you.
Don’t Forego the Inspection
A home inspection can feel like a daunting task, but it doesn’t have to be. By understanding what is involved in the process and who you should choose to help you through it, you can breathe a little easier. Flynn Law offers free contract reviews for our clients, so please do not hesitate to reach out if you have any questions about your purchase contract or would like some guidance through the home inspection process. We’re here to help!