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Home Inspection Report: Maximizing Your Advantage

A Home Inspection Report is an extremely detailed document. They can be dozens of pages long, and they describe literally every problem the inspector found.

It can really make a dream home suddenly look like a nightmare.

Once you understand them, however, the home inspection report is a valuable tool to leverage your negotiating power over the seller.

Table of Contents

  1. Walk The Home
  2. Home Inspection Report Key Issues
  3. Make A Wish List
  4. Negotiate An Amendment
  5. Check Before You Close

Walk The Home

Before the home inspection report is issued, the inspection will take place. The inspector will schedule a time with the seller to block out about four hours, or whatever is needed. (Do this during The Option Period.)

In my experience, most inspectors prefer you show up after they’ve done the inspection. This is because they have a process, and they need to get through it step-by-step. Buyers tend to be curious and worrisome and stall the inspector with questions that will all be addressed in the walkthrough, and the home inspection report.

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Amanda Bicknell/FEMA

Your inspector will set a time with you to arrive at the home once the inspection is finished. Take a good half-hour or so to let the inspector give you a tour, and the inspector will point out all the major as well as minor issues they found.

This walkthrough is essential in getting the gist of the home inspection report that the inspector will issue to you, usually same-day.

Home Inspection Report Key Issues

Now you’ve seen the problems pointed out to you by the inspector, and you will see them in the home inspection report.

The first thing you may notice about the report is that it is very long. That’s because home inspectors are licensed by the state, and the home inspection reports they issue must follow a standard, all-inclusive format.

Inspectors, like Realtors, have a fiduciary duty to you, the client, and they must report everything.

This doesn’t mean the home inspection report is a list of items for the seller to repair. It’s information about the house for you the buyer, and what you do with it is up to you.

Work with your Realtor to decide which items are deal-killers, which ones you can live with, and which ones are simply normal wear and tear for a pre-owned home. Hopefully the report did not contain any big surprises.

Note: If you are working with a lender to get a mortgage, the lender will often have requirements on items that must be repaired. Items include foundation, roof, structural, and other things that are important to the overall soundness of the property. Do not send the home inspection report to your lender. Lenders get more spooked about issues on these reports than buyers do, and it could mess with your loan approval.

Make A Wish List

Pretend it’s the holiday season and you are writing to Santa, but keep in mind that “Santa” is actually a stranger who is trying to sell their home to you for the most money and least hassle possible.

Start with the deal-killer and essential items first. What would make you not buy the home unless they were addressed?

After that, write down things that you could live with, but that you’d really appreciate if they were fixed before closing. I believe it is the right of every buyer to enjoy a home that is “move-in ready” from day one.

Next, write down a few more things that you could do without. These are your bargaining chips. They will depend a lot on not only local market conditions, but the relationship between your side and the seller’s side. Your Realtor will have a lot of insight on this since they are doing most if not all of the communicating with the seller side.

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“All I want for Christmas is an operating dishwasher.”

Negotiate An Amendment

Copy the home inspection report to your Realtor. (The report belongs to you, and the home inspector should have sent it to you only.)

Once you’ve finished your list, let your Realtor pitch it to the seller. Your Realtor will be going off of market conditions and the relationship thus far with the seller, and they will know best about how to get you as much as possible.

Are you in a seller’s market, and supply is low giving sellers the advantage? It’s going to be tough to get everything you want, so shoot for the key issues.

Was the seller acting like Scrooge McDuck during the initial offer contract process? Or are they a sweet, elderly couple that can’t wait to show you how to plug your TV into their pre-wired home theater system? These indicators will also help to know how the negotiations will go.

Amendment To Contract

Your Realtor may prefer to put all or some of the items in an Amendment to Contract from the start, and send that over to the seller, straight business-style. Or your Realtor may give a courtesy call to the listing agent and chat about the home inspection report to try and feel them out.

Either way, eventually you will need an Amendment to Contract, and signed by both parties. That puts the repairs needed to close the deal into the contract.

You can ask the sellers to make repairs themselves, have contractors do the work*, or even drop the house price or credit you money back at closing. (If you’re using financing, getting money back is nice because it chips down your down payment.)

Realtors are not attorneys, and are forbidden from “practicing law.” You may feel the repair issue is very complicated, and are unsatisfied with the language your Realtor has written in the Amendment describing the repair. If so, consider hiring an attorney to assist with this.

*Which contractor will do the work? A company you choose, or some guy the seller knows? This is also part of the negotiation. You may need to get bids from contractors if the work is complex and expensive, and use them as evidence.

Check Before You Close

In a previous post I described the final walkthrough. Not only is it necessary to see if there have been no new damages to the home since you went under contract, but you also can now check that the repairs have been done correctly.

You may even hire the home inspector a second time, or a different home inspector for a second opinion. If you’re not very handy, this may be a good option for you.

If everything looks good, congratulations! You’re about to move into your spiffy new home. If not, talk to your Realtor about delaying closing.

The contract with the amendment puts the burden on the seller to perform on the repairs. Don’t buy a home from a seller who hasn’t fulfilled their obligations.

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Call Jonathan Alpart, REALTOR© now, and get help with buying a home today! (682) 207-2823


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