offers and rising home prices, a home inspection should not be optional no matter what the terms of the sale. Jumping into a purchase this large should scream disclosure so that you can sign on the final dotted line with both eyes open, whether selling or buying a home.
After all, who wants to find out after moving into their dream home that the furnace is on the fritz or that termites have taken up residence in the attic? In case you're thinking of waiving the home inspection contingency, you should also be aware that some lenders require a home inspection as a necessary step before they finalize your home loan.
First, a home inspection checklist is made up, outlining how the inspector might have found damage or other causes of concern. He or she will be quite thorough, offering a snapshot of the home's condition at the time of inspection, pointing out everything from major fixes to minor cosmetic issues. Some of these may be representative of the home's, age, location, and how well the previous owners maintained the home.
But what are considered mandatory fixes? Here are the major areas that spell this out for you — (1) the terms of your purchase agreement (2) what the lender requires, and (3) local laws, codes, or regulations.
Most purchase agreements contain a home inspection contingency that allows the homebuyer to back out of the deal should the inspection turn up major issues. For example, if the inspection shows significant damage to the home's roof, the homebuyer could request the seller to replace the roof, or use the expense to ask for a lower sale price. The home seller can decide to appease the homebuyer by lowering their price or fixing the roof and proceed with the sale of the home, or choose to sell the home 'as is' and reject any improvements. It all becomes a point of negotiation after the original offer and can change the terms of the agreement.
Some states require the sellers to provide a report from a licensed pest control company showing that the home is free of termites. In others, if a home inspector finds home improvements, the seller made not to code, or without securing a permit, the local building official will hold the seller liable, requiring them to bring the improvements up to code and pay increased permitting fees.
Because of all this, it has become increasingly popular for sellers, in preparing their homes for sale, to consider having a home inspection done before listing it. Getting caught off-guard can be very disconcerting, so getting ahead of it permits the possibility of a smoother closing process.
