A home inspection can offer assistance to a seller who is trying to provide accurate disclosure and a home inspection can assist a buyer in understanding the condition of the home.

The laws of many states allow the buyer and seller a few days to complete the professional property inspection process during a home sale transaction. The results of the inspection can impact your current negotiations and delaying the process could have legal ramifications.

If a buyer delays the professional inspection process, his refundable deposit money is put at risk. Closing escrow without the benefit of a professional inspection, the Buyer and Seller will stand alone to defend and resolve unforeseen problems in the home. These situations are avoidable, in a p ractical and legal sense, by completing the professional Home Inspection process within the 10-15 day contingency period.

The inspector

A professional inspector is third-party, independent of the transaction, although "strongly recommended" many times throughout California Real Estate documentation. S/he visually inspects and detects adverse conditions in a home. S/he investigates, operates and systematically identifies the major systems and components of the home.

The inspector is addressing health and safety issues, making recommendations and counseling on repair options and maintenance. As a buyer, be prepared to attend the inspection.

Professional inspectors will not perform or offer to perform any repairs to a home, eliminating potential for conflict of interest. Health & safety concerns, adverse conditions and required re-sale corrections are discussed and documented by the inspector. Issues can be anything from minor roof repairs to improper venting causing carbon monoxide emission or a fire hazard. A defective light switch to structural failure. Sometimes issues suggest maintenance, some require repair; all are health and safety issues that a buyer wants to know about.

An inspector is a trained generalist, identifying and sorting through the multitude of major systems and components, meeting state required "physical condition disclosure" requirements.

The Inspection Report

The inspector's report is an important tool in Real Estate transactions. It is the only document that details the product being bought and sold. Once conditions are defined, it is up to the buyer to decide if the current condition of the home will meet his financial and family needs. The buyer decides what is acceptable and what isn’t. Sellers are not required to make the corrections, although re-negotiations are often the result of facts documented at the inspection. It is information needed to make some educated business decisions.

"As is," a common yet unsettling term used in Real Estate, expresses a sellers unwillingness to be accountable for conditions present in the home, customarily included in non-owner occupied homes, repossessions or bank owned properties. "What is?" should be a buyer's first response when involved in an "as is" transaction. An amateur roof installation or improper wiring of the electrical system will ultimately impact a buyer's family budget. A property inspection defines "what is" information needed to determine if the sales price accounts for the repair or replace costs the home will need. "As is," a take it or leave it mentality, is often flexible. Re-negotiations, based on inspection facts, between motivated buyers and sellers has proven to be successful. Agreeable terms can usually be reached.

Inspections aren't just for buyers Home sellers need a professional inspection and report to protect themselves from liability of future non-disclosure claims. A pre-listing inspection also provides sellers with appropriate condition information, used to price and prepare their home for sale. When repairs are needed, the seller can price-shop bids and choose the contractor without feedback of a potential buyer. The seller can disclosure adverse conditions they decide not to repair, offering them some relief of liabilities carried in re-sale real estate transactions. The report helps in marketing to potential buyers, providing up-front information to determine if maintaining this home will meet their financial position.

The buyer's inspection

Once a buyer has an accepted and signed purchase contract, his deposit money is protected in escrow for approximately 10 days. After that time, a buyer's deposit is at risk. As an example, 5 days into escrow, the buyer learns that the heating system needs some repairs and is nearing the end of its useful life. The buyer feels this condition is unacceptable and brings his concerns to the seller. If the seller is not willing to re-negotiate, the buyer can have his deposit returned to him from escrow and continue house hunting. If the buyer learns of the heater problem after the 11th day of escrow, the deposit money becomes a factor. The seller and Realtors now have a legal right to a portion or all of the buyers deposit money as compensation for lost-marketing momentum and costs. This jeopardizes his deposit and eliminates leverage the Buyer would have had the day before. It is called a "contingency period" Loan approval also needs to be accomplished during the contingency p eriod to protect a buyer's deposit.

Home buyers and sellers can easily avoid contractual timing obligations and escrow complications that mandatory condition disclosure can create. In some states, the professional inspection process is done before signing a sale or purchase contract. A buyer can have their potential home professionally inspected prior to signing an offer to buy. Sellers can have a pre-listing inspection prior to marketing their home for sale. Sign first, ask questions later’ offers no benefits to a buyer or seller.

The Best Protection

An Inspector collects his fee at the time of the inspection, purposely keeping himself out of the transaction. A professional Inspector is accountable for accurate condition disclosure. The State of California, for example, defines regulation of Home Inspectors in the Business and Professions Codes Section 7195-7199. Inspection Industry Standards of Practice have evolved over time, clarifying the varied expectations in Real Estate. There is logic and experience to back the many disclaimers Industry Standards include. An experienced inspector can give you a tremendous amount of information.

Home Inspections are not intrusive or technically exhaustive and should not be considered a guarantee or warranty. It is the best information and protection available at an affordable cost. The Standards of Practice of the American Society of Home Inspectors (ASHI) and the California Real Estate Inspection Association (CREIA) are recognized by CA defining the standard of care and expectations. The Home Inspection process meets the mandatory condition disclosure requirements of Real Estate.

Professional inspections are not mandatory, but an inspection is the best information and protection available at an affordable cost. Most states have adopted standards of practice from the American Society of Home Inspectors (ASHI.) These professional standards are specifically designed to meet the mandatory condition disclosure requirements for all parties involved.