Everything You Should Know About Home Inspections

Found a house you love and have an accepted offer? The hard part isn’t over yet. I caution buyers to not get too emotionally attached to a property until they have completed a home inspection. In a basic home inspection, the inspector will check the structural and mechanical systems of the house (foundation, electrical, plumbing, roof, furnace, etc.) There are additional inspections for pests, radon, and anything else of special concern. A home inspection is one of the most important steps in the home buying process.

Be sure to know your contract.

Deadlines in a real estate purchase agreement are specific, and time is of the essence. According to the Western Michigan real estate purchase agreement, a buyer has a ten day period to perform any inspections they deem necessary. After inspections, and depending on the results, a buyer has the right to 1) continue with the purchase as is, 2) terminate the contract completely, or 3) renegotiate with the seller for the costs of repairs.

Don’t be cheap when hiring an inspector.

Shop based on reputation rather than price. I have had people in the past trying to save money say stuff like, “my uncle is really handy. I will have him do my home inspection.” My response is always, “Let’s have that person look at it and get their opinion, but still hire a professional who specializes in home inspections.” In the grand scheme of a home purchase, inspections are a very small price and not something you should skimp on.

How do you choose an inspector?

A good place to start is asking family, friends, or your Realtor for recommendations. After you receive the recommendations, I would do your own research as well. Look up the inspector online, call and ask questions, do whatever you need to do to make an informed decision.

Do they have credentials?

One thing I find very interesting is that in the state of Michigan, there are no licensing requirements to be a home inspector. It’s ironic that someone is supposed to have a license to cut your hair, but not to inspect the biggest purchase most people make in a lifetime. However, there are other ways inspectors can show their credentials. One such way is being a member of NAHI (National Association of Home Inspectors) or ASHI (American Society of Home Inspectors).  Members follow the standards of practice and ethics set forth by these organizations.  An inspector can also be HUD (Housing and Urban Development) approved. This qualification requires a certain amount of experience and additional training. One inspector that I really like holds an active builders license. He is not a builder, but he keeps up on those requirements to maintain a high standard of education.

What happens during the inspection?

In a typical home inspection, the inspector will have a long checklist of everything they will inspect. It is their job to find things wrong with the house, so you will get a comprehensive list of items that warrant attention. They will even point out small things just to keep an eye on.  It is important to be present at the home inspection.  This allows the inspector to explain things in person and gives you a chance to ask questions.

Examine the results.

No house is perfect, not even new construction. It is normal to have a lot of little problems or deferred maintenance items. What you really want to focus on are health/safety issues and big money items that you were not previously aware of. It’s probably ok if the furnace is old and you are already aware of that fact and can afford to replace it. However, a surprise bad roof is a hefty expense. Hidden structural issues should also be of major concern.

Do you renegotiate?

The tricky part of renegotiating that many people don’t realize is that the seller can cancel the contract on a buyer if they try to change the terms. During this inspection time period, the sellers can still advertise the house for sale to other buyers. Even though the house is already under contract, the seller can accept a back up offer in case the current agreement falls apart.

There are certain problems that come up during inspections that I feel a seller should always be willing to fix. Some of these items include mold, radon, and pest infestation issues. These issues are more serious than just a little deferred maintenance. Once the issue becomes known­, the seller must disclose the problem, so it is something they would have to deal with even if they had another potential buyer.

Over the last few years, there were plenty of houses for sale and not many buyers, so buyers had the upper hand. Issues came up on inspections and the attitude of many was “Why not ask the seller to pay for these repairs? What can it hurt?” However, in 2012 the market drastically changed. Inventory dwindled, prices rose, and it became a seller’s market. Good properties get a lot of attention and there is strong competition among buyers. This is a situation where the seller might drop a buyer if they try to renegotiate and go with a better back up offer. The less time the property is on the market, the greater the risk of renegotiating. The market is an important factor in making the decision to renegotiate based on inspections.

Overall, the inspection is a very important step in the home buying process. Take the time to get acquainted with the real estate purchase agreement, the inspection process, and the specific inspector you choose. Don’t let an overwhelming emotional attachment to the home sway you into buying a property with major issues. On the other hand, don’t lose a great house over minor issues that can be easily remedied. Armed with a realistic attitude and a great inspector, a buyer can make good, informed decisions.

By Lisa VanderLoo  3/26/13

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Lisa VanderLoo

Lisa VanderLoo

Sales Associate
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