Our Real Estate Blog
A home inspection can make or break a property sale. If all goes well during a home inspection, a buyer and seller can proceed with a transaction. Conversely, if a home inspector discovers major problems with a house, a property sale may be in jeopardy.
As a homebuyer, you'll want to do everything possible to ensure a home inspection delivers valuable insights. With in-depth home insights at your disposal, you can determine whether to continue with a home purchase or reenter the housing market.
To ensure a successful home inspection, let's take a look at three common home inspection mistakes, and how a homebuyer can avoid these problems.
1. A homebuyer hires an inexperienced home inspector.
When it comes to hiring a home inspector, it is always better to err on the side of caution. With an experienced home inspector at your side, you can boost the likelihood of a successful home inspection.
Evaluate a variety of local home inspectors. Then, take a look at each home inspector's background and expertise to narrow your search.
In addition, if you feel comfortable with a home inspector, reach out to this professional directly before you make your final hiring decision. That way, you can request client referrals and gain additional insights to help you make an informed selection.
2. A homebuyer does not attend a home inspection.
A homebuyer is not required to attend a home inspection. However, attendance usually is a good idea, regardless of your homebuying expertise.
Remember, a home purchase is one of the biggest transactions that you likely will complete in your lifetime. If you want to ensure a home is a viable long-term investment, it certainly pays to walk around a property with a home inspector and conduct an in-depth evaluation.
In many instances, attending a home inspection may enable a homebuyer to gain home insights that might not be included in a home inspection report as well.
For example, a home inspector who identifies issues with a property may be able to give a homebuyer an estimate about how much it will cost to complete myriad property repairs. These insights are exceedingly valuable and can help a homebuyer determine whether a house is a worthwhile purchase.
3. A homebuyer ignores a home inspection report.
After a home inspector completes a property evaluation, this professional will provide the homebuyer with a home inspection report. Then, a homebuyer will have a set amount of time to review the report to determine whether to proceed with a home purchase.
A home inspection report contains plenty of valuable insights, and as such, should not be ignored. Instead, a homebuyer should spend time evaluating the report and learning from it. And if a homebuyer has any questions, he or she can reach out to the home inspector who provided the report for answers.
Lastly, if you need help planning a home inspection, you should employ a real estate agent. By hiring a real estate agent, you'll have no trouble getting in touch with the best home inspectors in your area.
In a high competition market, you may be tempted to do whatever you can to entice the seller to accept your offer. Buyers write offer letters, provide large down payments, or waive the inspection. Sometimes, this strategy includes removing contingencies from your contract.
Beware. Removing contingencies can easily become a nightmare for you as a buyer. Certain contingencies should be kept no matter how much you think you should waive them for enticement.
The Home Inspection Contingency
This contingency is basically universally recommended by realtors everywhere. This contingency allows you to get a licensed home inspector who will check the property. The inspection typically should be done about 7 days from the time you sign the purchase agreement for the home.
Following the inspection, you as the buyer can request that the seller make certain repairs. The seller can either make the repairs or provide a counter offer. If you’re not satisfied or cannot reach an agreement, you can back out of the deal and still get your money back.
Without this contingency, you’ll never know what’s wrong with the home until you move in it. It’s a huge risk to take to move into a home without understanding all of its moving parts. Is the roof stable? Has the basement flooded? Will the appliances last? There are plenty of questions that you might have about a home that can be answered simply through an inspection.
This is an important contingency. Your offer on the property will depend on being able to get the financing you need to purchase the home. With this protection in place, in the event that you can’t get a loan, you’ll get your deposit on the home back. Be sure that the clause specifies the number of days that would be recommended by your lender to have the mortgage approved.
This could be the most important contingency of all. This protection could possibly save you thousands of dollars of a headache. Once an offer is accepted on a home, you’re far from done. The lender will typically order an appraisal. If the appraisal comes in lower than the offer you made on the home and agreed to pay, you may have some problems.
The lender will only lend you what the house is worth. If the appraisal comes in lower, you’ll need to make up for tens of thousands of dollars out of pocket. Make sure you have an appraisal contingency included in your contracts!
As you buy a home, remember how important contingencies can be in the process.
There is a lot that goes into the buying and selling of a home Not only are there many steps to take but it can feel like there is a report for everything. It’s easy to forget what they are or why they are necessary.
Three processes that seem similar to home buyers are the home inspection, comparative market analysis, and the appraisal.
Here’s what each them is and how they are different:
First, let’s look at the home inspection.
The home inspection
What it is:
This is probably the one you are most familiar with and have heard the most about. During a home inspection, an inspector is paid to come and test all of the appliances, outlets, plumbing as well as the heating and cooling system.
What this information is for:
This information is for you the buyer, It is to help make a well-informed decision as to whether the investment you are making is worth the current state of the home. Whether there be repairs that will have to be made or replacements that will need to happen down the line.
The custom market analysis or CMA
What it is:
A sales report your real estate compiles using data they have exclusive access to. This data is compiled into a database used solely by other real estate agents.
What this information is for:
A CMA is used by you and your agent to determine if an asking/selling price is fair. You’ll be able to compare the pricing to other listings and conclude whether it is higher, lower or on par with other offers. This is incredibly useful no matter which end of the spectrum you plan on selling or buying.
What it is: A licensed appraiser comes to visit the home and inspect it solely for value. This is determined by the location, state of and surroundings of the home. Your potential home will be compared to other similar properties in the area to come to a conclusive value.
What this information is for:
The final approval of your mortgage terms by your lender. If the determined value is much lower than your offering price you can be declined a mortgage.
As you can see, each of these processes has varying impact on the final purchase of your home. The information obtained from a home inspection is up to solely your discretion. That gathered from the CMA helps you to determine where the asking price of a home is sitting in comparison to others on the market. And in turn, whether you’ve got a really great deal on your hands or an inflated price. And lastly, perhaps the most important is the appraisal. The information gathered from this process is what your lender uses to determined whether or not to lend you the requested amount.
Although a home seller has already accepted your home offer, you'll want to employ a diligent home inspector to examine a residence before you finalize a purchase agreement. By doing so, you can identify any potential home problems that you might have missed during an initial house showing. Plus, a home inspection will allow you to find out if a home requires extensive repairs or maintenance and if you'll need to modify or rescind your original offer.
Hiring the right home inspector can make a world of difference for homebuyers. However, finding the ideal home inspector sometimes can be difficult, particularly for homebuyers who want to speed through the homebuying process.
So what does it take to employ the right home inspector? Here are three tips to help you do just that:
1. Review a Home Inspector's Qualifications
Learning about a home inspector's experience and skills is paramount. And if you devote the necessary time and resources to understand a home inspector's qualifications, you'll be able to find out if this individual is the right person to assess a residence.
Typically, you should try to find a home inspector who boasts construction and building maintenance expertise. Depending on where your home is located or your residence's condition, you also may need to find a home inspector who understands how to deal with asbestos, lead-based paint and other potentially hazardous conditions.
Be sure to conduct an in-depth evaluation of several home inspectors before you make your final decision. This will enable you to hire a top-notch home inspector who can help you identify and resolve any home issues before you conclude your home purchase.
2. Evaluate Sample Reports from a Home Inspector
Ask a home inspector to provide samples of past home inspection reports – you'll be glad you did! By getting copies of past home inspection assessments, you can better understand how an individual approaches a home inspection.
For example, does a home inspector provide clear information in his or her reports? And does the inspector offer notes that highlight home problems? Take a close look at a home inspector's past reports, and you can find out whether this individual takes a basic or comprehensive approach to his or her work.
3. Get Home Inspector Insights from Your Real Estate Agent
Your real estate agent may prove to be your best resource throughout the homebuying process. As such, your real estate agent can put you in touch with home inspectors who have your best interests in mind and will do everything possible to conduct a thorough inspection of a property.
In many instances, your real estate agent may be able to offer multiple home inspector recommendations. This professional also can provide details about what to expect during a home inspection and how to handle any home problems that you might encounter as part of a home assessment.
A home inspection may seem like a tall task, but with a great home inspector at your disposal, you can improve your chances of obtaining the ideal residence.