Home Inspection Guide
No matter how fully the seller discloses, there are many things the seller themselves may not be aware of. So disclosure forms are never a substitute for a due diligence inspection.
And just because you’re buying a newly built home doesn’t mean it will be perfect. You should still have your own professional home inspection performed. Be sure to clarify with the builder how defects will be corrected and who will pay for correction or repair.
How to Word the Requirement
Next to financing, the home inspection is probably the most important contingency in your purchase contract. No matter what the housing market is like in your area, most experts would strongly urge you not to waive the home inspection contingency.
Wording of the inspection contingency varies by state, so be clear what you wish to have happen and what is written in the contract before you sign it. The contract should specify, for example, whether you or the seller will pay for the inspection; cost varies, but is usually in the $200 to $400 range.
You will also want to spell out what will happen if the inspector finds problems that were not previously disclosed by the seller. For example, the clause might stipulate that you can decide which defects you want the seller to correct, or to renegotiate the price based on the estimated costs of such repairs. The inspection clause may also be written to let you cancel the offer outright, without letting the seller try to correct or repair the problems.
Bear in mind that the seller doesn’t have to make every repair and, in fact, may refuse to make any. If both parties want the sale to go through, however, it is in both your interests to discuss and negotiate how defects will be repaired and who will pay for them.
Finding a Good Inspector
Not every state has a certification program for the home inspection industry and requirements for certification vary widely. (The American Society of Home Inspectors offers a search to find ASHI certified inspectors in your area.)
Even if you live somewhere that certifies inspectors, finding a good one is often a matter of word of mouth. Most real estate agents will be able to recommend several (get at least three names), and you can also ask friends who had an inspection done recently.
What to look for when choosing a home inspector:
Experience is key. Inspectors learn something new on each job, so the longer they’ve been in business the better. Ask how many inspections do they do annually. Are they ASHI certified?
You should also try to find an inspector with a background in general contracting rather than a specialist in electrical or plumbing; he or she will be better able to inspect all areas of the home. But beware of contractors who do inspections “on the side.”
Find out what sort of report the inspector issues. You want an inspector who can explain things clearly and answer your questions as you walk around with him (and you do want to accompany the inspector on his or her rounds). But you also want one who provides a written report that gives you a clear description of the condition of each item or component (not just “good, fair, or poor”) and makes a recommendation about repairing anything seriously deficient.
Ask how long the inspection will take (2 to 4 hours, depending on the size of the house) and what will be included.
- Find out if the inspector has Errors and Omissions Insurance, which will offer some protection if the inspector misses something significant.
What Will Be Inspected
You may need several types of inspections. The most common is the professional home inspection, followed by a termite or pest inspection. If the seller’s disclosure revealed an abandoned septic tank or other potential hazard, you’ll want a specialized inspection of that as well. And be sure the inspector tests for radon.
Radon is a radioactive gas that comes from the natural (radioactive) breakdown of uranium in soil, rock, and water. You can breathe or ingest it into your body, and according to the Surgeon General it is the second leading cause of lung cancer.
Radon occurs all over the U.S.; it is present in every house. The question is whether the amount of radon present exceeds safe limits. The EPA says the only way to find out is to test for it.
Other Basic Tests
At minimum, a competent professional home inspector will look at the following:
- Foundation: Is it structurally sound? Are there cracks or other evidence of shifting or moisture problems?
- General construction: What is the quality of the home’s overall construction?
- Exterior: Does the house need exterior repairs or maintenance?
- Plumbing: What is the condition of the overall plumbing system? Are there signs of leaks or water pressure problems?
- Electrical: Do any dangerous electrical situations or apparent code violations exist?
- Heating and cooling systems: How old are the systems? Have they been properly maintained and are they adequate for the size of the house?
- Interior: Are floors firm and level or squeaky and slanted? Do doors and windows open and close properly? Are locks in working order?
- Kitchen: Do appliances function properly? Is the plumbing, including the dishwasher connection, in good repair (no leaks around faucets or under the sink)?
- Baths: Is there any evidence of previous or current water leaks? Is the floor solid? Is the plumbing in good repair (no badly chipped enamel, for example)?
- Attached structures: What is the condition of any attached structure, such as decks, garages, and sheds?
- Roof: When was the roof last replaced? What is its condition and its estimated remaining life? What is the condition of the roofing structure as well as the shingles?
Look Now or Lose Later
The home inspection is the time to address all concerns and requests for repairs. If the seller agrees to repair or replace certain defects, you’re entitled to have those completed. However, if on the final walk-through before closing you notice something else, you’re out of luck unless it’s related to the appliances, heating and cooling equipment, or the electrical and plumbing systems, all of which must be conveyed in working order.
So during the home inspection be sure to pull up those area rugs and look at the floor underneath. Look behind the paintings on the wall. If a wood floor or wall is badly discolored, this is not something you want to discover on the morning of your scheduled close.
Don’t Be Penny-Wise and Pound Foolish
During an inspection of a house that otherwise looked in excellent shape, one home inspector found a crack in the heat exchanger in the central heating system. The cost of replacing the heat exchanger was no more than $500, which was money well spent. In the long run, the cost could have been much heavier: for one thing, the cracked heat exchanger could have cost the home buyers hundreds of dollars in utility bills. The more serious threat, of course, would have been carbon monoxide leaking into the house through the air ducts.
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