How does a home inspection work?
A home inspection is an important part of purchasing a home. This is where your intention should be to identify defects in the property that you are intending to purchase.
When a seller decides to list their home on the market they are required to completed Real Estate Condition Report. On this report they are disclosing to potential buyers any conditions of the property that they are aware of that meet the questions laid out in the Condition Report. Keep in mind, these are only conditions that the seller is aware of or has not already addressed via repair. The purpose of the home inspection is to discover anything that the seller was not always aware of even though it may have been present during their term of ownership.
The home inspection is a contingency in the offer to purchase that you write and is subsequently accepted by the seller of the property. A formal inspection is only completed with written permission of the seller and after the offer is accepted. You and your agent will determine the deadline by which this should be completed when drafting your offer to purchase.
The cost of the inspection is typically a few hundred dollars but can range up to the $800 range depending on the services of the inspector. This is paid for by the buyer out of pocket at the time of the inspection.
We recommend that the buyer be present at the inspection during the time it is taking place. It typically ranges about 3 hours in length. The seller is not typically present, although they may be. This is a great opportunity for a first time home buyer to learn about the ins and outs of home maintenance and any deferred cost items. Deferred cost items would be conditions found during the inspection that while not failing or defective at this time, may be in the near future. (Something to keep an eye out for or budget for) This may or may not be a defect per the offer to purchase.
Upon completion of the home inspection the home inspector will deliver a report to the buyer outlining what was discovered. A copy of this report is then delivered to the seller through their representatives. It is important to discuss what is discovered on the report with your agent. Ideally you will have a Buyer’s Agency Agreement in place which will allow your agent to negotiate in your best interest when it comes to items of concern on the report or defects discovered that need to be remedied. You and your agent will discuss the varying degrees of which to address that which was discovered and decide the appropriate course of action.
There are many options for remedy which include but are not limited to the following:
Request repair by the sellers
Accept the property given the information you have become aware of
Negotiate a credit or escrow toward future repair of items
You may nor may not have the right to end the offer based on the discovery depending on how your offer was drafted.
All of these things typically happen within the first couple of weeks after your offer is accepted and all details of your specific transaction are detailed in your accepted offer to purchase contract.
This is an overview to help you understand the process. Please consult our Realtor representative to talk about the terms and best course of action for your transaction.
This should not be construed as providing any legal advise.