Lisa Schade

Broker, BS, CDPE, SFR

Handling Home Inspections During the Buying Process

 

 

It's no secret that today, home inspections have become a "must" in the real estate process. It may look like a dream home, but sometimes there are hidden characteristics that are vital to consider before signing on the dotted line. Key to protecting your budget, home inspections find what the naked eye can't, and can set your (and the seller's) expectations as to the cost and timing of when you can expect that cost can be incurred.

What to Expect During a Home Inspection

 

Once your professional, licensed home inspector is on the premises, he or she will review the major, visible and accessible components of the home and provide a detailed written report rating each element. The report should objectively include information in a detailed manner (sometimes even photos or charts) that allows you to make informed decisions.

Decisions, Decisions

After speaking with the home inspection professional and hearing your prospective home's report card, it's time to make some decisions. Were the details relatively acceptable? If you're shaking your head because the inspection resulted in a costly item, don't freak out just yet. Instead, have your REALTOR request an extension of your contingency or objection period to take some of the pressure off while you collect more information. Follow these steps in order to help avoid panic:

  1. Assess. Immediately decide how much work you are willing to complete after close of escrow, considering both cost and inconvenience.
  2. Collect. Obtain at least three contractors' bids for the repair(s) at issue-for your own information and to increase your credibility in your renegotiations with the seller. Don't forget to collect competitive bids from a general contractor or plumber and ask the home inspector whether any of the repairs can be done over time or legally completed by an unlicensed handyman. You can reduce the costs of repair bids by sometimes 30% or 40% this way.
  3. Request. Through your REALTOR , approach the sellers with a request for them to pay a closing cost credit to free up some of your cash for post-closing repairs, to complete some repairs or to reduce the price-in that order. Prioritize the strategies that would result in the repairs actually being completed, saving a price reduction as a last-ditch effort.
  4. Assess, again. Once your renegotiation with the seller is done, assess whether you are satisfied with the condition of the property given the final terms of the purchase, including any credits, repairs or price reduction agreed to by the seller.

With so many homes on the market today, your first instinct might be to think it's easier to just move on to the next property. However, if you take the time to properly review your overall situation, including any credits, repairs or price reduction agreed to by the seller, you'll be able to better gauge the right decision for both you and your wallet, all while keeping your cool.

Source: FrontDoor

Reprinted with permission from RISMedia. ©2013. All rights reserved.

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