After negotiating and agreeing on the purchase price and terms of an offer on a property, the next major step in the home buying process is the home inspection.
A home inspection is a limited, non-invasive examination of the condition of a home.
Typically hired by the buyer (a home owner can hire an inspector as well, which I will detail later in this blog), the inspector therefore works for the home buyer and the report belongs to the home buyer. Many Realtors can and will refer to a list of reputable inspection companies, but ultimately the choice of whether to have an inspection and who to hire for said inspection is up to the buyer.
There are different options available for home inspections, ranging from limited to full, plus ancillary screenings for termites and other wood destroying insects, mold, air quality, asbestos, lead, and more. You name it, it can likely be tested. For the purpose of this blog, I’m going to focus on a full home inspection and what it entails.
While a full home inspection is limited and non-invasive by definition, it is still thorough. The home inspector will conduct an examination from the roof down to the foundation substructure and everywhere in between, taking pictures and noting their findings. A full home inspection can take approximately 2-4 hours, depending on the size of the house and the ancillary tests ran.
I highly recommend that whomever orders an inspection attends at least for the last hour to address any questions or concerns that you specifically have about the property. Being that the inspection time is generally longer than the time you had at your initial viewing of the property, it is also a great time to take a closer look at the home.
After the inspection is complete, the inspector will provide a detailed report of their findings for you to address prior to listing or during your purchase. Some home owners prefer to order a pre-listing inspection to determine the condition of their property and avoid surprises in the middle of a transaction. It can be a great idea and potentially give you a competitive advantage if you are in an area saturated with competition because it puts a perspective home buyer’s worries to rest. However, an important note to keep in mind is that any defects revealed during a pre-listing inspection that are not repaired, MUST be disclosed when you list.
In the home inspection report, findings will be rated into 3 basic categories (or some variation of these):
- Satisfactory – The component was functioning at the time of inspection.
- Fair – The component was functioning at the time of the inspection, but is showing signs that it could need repair/replacement at some point and should be regularly monitored.
- Poor – Component requires immediate repair and/or further evaluation by a specialist in that field.
As a home buyer, once you receive the inspection report you have the opportunity to negotiate repairs or terms with the seller prior to accepting the property (unless you agreed to accept the property as-is, then you would have the option to proceed with the transaction or cancel). Understand that the inspection report is a recommendation and the repairs that you request are your choice*. In Indiana, the terms of the purchase agreement are pretty specific on the nature of repairs and defects, however. You should further discuss the nature of those terms with your Realtor and/or attorney.
The language in a home inspection report can be intimidating and scary at times. Keep calm and remember that everything can be fixed. If there is anything in the report that you are confused about, your home inspector would be happy to provide more insight to their findings and you are welcome to consult a third party expert in that respective field.
It is important to note that once repairs are agreed upon, it is the responsibility of the home buyer to have the repairs re-evaluated and confirmed complete prior to accepting the property. This can be done by you or you can elect to have the inspector back out for a fee to conduct a re-inspection.
*Repairs required by the appraiser are separate from the inspection and would be required for approval of your mortgage loan.