Almost every buyer gets a home inspection as part of the process of buying a home. And that's for good reason. If you don't get a home inspection, you open yourself up to a lot of risk that could be detected and avoided by having an inspector come through the home. In fact, if you buy a HUD home (a foreclosed home owned and listed by the federal government), you sign a full page warning dedicated to the idea that every home buyer should get a home inspected. In the old days, it was "caveat emptor - buyer beware!" These days, most everywhere, including here in West Michigan, there is an inspection period written in to the purchase agreement. So what is an inspection and how does the process go?
Inspections are done so you can fully appreciate the condition of the home and so you can make yourself aware of health and safety issues that might make make you reconsider your offer. An inspector is going to be knowledgeable about many facets of a home, although not necessarily an expert on any one thing. He'll be able to give you a pretty thorough report on the home. It's important to remember that in most cases you're dealing with a "used" home. There is going to be wear and tear. There are likely going to be some quirks about the home. But from a negotiation standpoint, you're really looking for health and safety issues.
When you as a buyer write an offer that has been accepted by the seller, that document that started out as an offer is now a purchase agreement. It lays out the rules for how we get from that point to closing. Paragraph 13 of that agreement says this:
It continues on the next page of the agreement:
In plain English, what that means is this. You, the buyer, have ten days from the time the seller accepts your offer to have the home inspected and make a decision based on that inspection. You can decide to accept the house as it is. You could ask the seller to fix certain issues. Or you might ask the seller to reduce the sale price that you had agreed to in an amount that reflects the cost of fixing something that came up unexpectedly at the inspection. I say unexpectedly, because presumably your offer took into account issues that you already knew about before the inspection.
Hopefully, the inspection goes well and there's no request that needs to be made. The inspector will give you a full report with pictures and explanations, and I will go over it with you to help determine whether there are issues that need addressing. If you do make a request of the seller, they must respond to your request within three days in one of a few ways. They could agree to or simply reject your request. They could propose a different solution. Or - and this one is important to remember - they have the option to cancel the contract SIMPLY BECAUSE YOU ASKED.
Why would a seller want to cancel a contract like that? I mean, they want to sell, don't they? Well, in our current market (early spring of 2014 as of this writing) it's not uncommon for sellers to receive multiple offers or even have offers come in after they accept one. A seller might feel, especially if your request is borderline reasonable, that they can find a better deal with a different buyer. Or maybe they get seller's remorse and just decide not to sell. It doesn't happen often, but it can happen. So, in the case of inspections, it really can hurt to ask. I usually counsel a buyer not to make a request unless they're willing to lose the house over it. It always comes down to what your comfort level is.
If you can't reach an agreement as to what is to be done following inspections, and assuming you've made a timely request in writing, you, the buyer, will be entitled to cancel the agreement and get your earnest money deposit back.
Now, from a seller's standpoint, my job as your listing agent is to help you consider a buyer's request, understand whether it's a reasonable one or not, and decide how to respond. Understanding what is typical in our market and what is not plays a huge role in considering these things. I see it as my job to lay out the options, tell you the best and worst case scenarios, and allow you to make a decision.
Inspections have become an integral part of the buying and selling process. With a little help from someone who deals with them on a regular basis, you can feel confident that you are making good use of the inspection opportunity. And of course, if you need a referral to a quality inspector, I can introduce you to a couple of inspectors who come recommended by my clients and have done good work for them in the past. That's just one benefit of working with me as your agent.
