You should always obtain a home inspection by a professional home inspector before purchasing a home. Laws concerning what information the seller is required to give the buyer about a home’s condition vary from state to state. For instance, in Maryland, a seller can simply sign a “disclosure and disclaimer” statement indicating that the house is being sold “as is” (though a recent change does require all sellers to disclose known major problems). By contrast, California sellers must fill out a detailed, multi-page disclosure statement that includes everything from major structural issues like the condition of the roof and foundation to the age and condition of the appliances to the presence in the neighborhood of barking dogs and other nuisances. Those legal requirements do not substitute for a home inspection, and the buyer should negotiate his own home inspection contingency.
Instructions
1. Add your home inspection contingency to your written purchase offer (the contract of sales). Do not rely on verbal promises. Allow 7 days for obtaining a home inspection and report.
2. Include a provision where the seller refunds the buyer the cost of the home inspection at settlement. A home inspection will probably cost about $400 to $500. If the seller is unwilling, ask your real estate agent to reimburse this money at settlement. In a buyer’s market, most sellers and their agents will readily agree to this.
3. Include a kick-out clause allowing you to walk away from the purchase with your deposit if the home inspection is unfavorable.
4. Consider a clause obligating the buyer to make repairs or to provide funds at settlement for repairs of defects up to 5 percent of the purchase price of the house.
5. Include a period of at least 3 days for you to evaluate a home inspection report before you must act to terminate the contract. This will allow some time for contacting repairmen for estimates, considering whether you still want to buy the home, and even re-negotiating the price with the sellers.
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