A Buyer’s Guide to the Home Inspection Process

You’ve come a long way on your homebuying journey. Now, you’ve finally found a home that’s just right, have signed a purchase contract, and are waiting for the sale to close.

But how do you know that the home you’re buying is in good condition? This can cause some stress even if you’re pretty handy, as potential problems and safety issues may cost you significantly after you move in. That’s why it’s crucial to have a home inspection done before the sale closes and the title is in your name.

Overview of home inspections:

• Conducted by a professional, third-party inspector
• Furnishes the buyer with a comprehensive report on both major and minor property issues
• Typically scheduled in the weeks preceding the closing date to allow the seller ample time for addressing significant concerns
• Buyers have the option to include a contingency permitting them to withdraw their offer if substantial problems are uncovered during the inspection
• Generally priced at approximately $500, with potential additional expenses if specialized inspections are necessary

What is a home inspection?

A home inspection is an assessment of a home’s current condition. It’s completed as part of the closing process after the seller accepts the buyer’s offer and provides the buyer (you) with additional information and peace of mind before making such a significant investment.

Certified home inspectors will perform an inspection that focuses on areas such as the home’s HVAC, plumbing and electrical systems, foundation, structural elements such as the roof and walls, and other areas. You’ll receive an inspection report outlining both major and minor issues with the home.

The home inspection contingency

A home inspection is even more meaningful if your purchase contract includes a home inspection contingency. This contingency allows you to walk away from the sale, with your earnest money, in the event the home inspection reveals any issues with the home. If you walk without a contingency in the contract, the seller can keep the earnest money regardless of what the inspection uncovers.

The contingency gives you negotiating power, especially in a housing market that favors buyers. If there is an issue you’d like to have addressed, the seller will be encouraged to act to prevent the sale from falling through.

On the other hand, in a highly competitive housing market, you might consider waiving the home inspection contingency (and other contingencies) to make your offer more attractive. While this may be an effective buying tactic, it leaves you at greater risk if there’s a problem with the home.

Your real estate agent, who creates the purchase contract (often using a template created by an attorney who specializes in real estate transactions) can discuss the pros and cons of using an inspection contingency.

Home inspection cost and timing

As the buyer, it’s your responsibility to find an inspector, and schedule and pay for the inspection. The cost varies by inspector, as well as the home’s size, age, and condition. Setting aside $500 for a home inspection is a good rule of thumb.

An inspection typically happens in the weeks leading up to the final close. However, it’s important to time the inspection early enough in the closing process to give the seller a fair chance to address any issues.

The inspector may also recommend a specialist come to the house for specific issues — for example, an electrician to inspect the condition of old wiring or an HVAC technician to look at a noisy furnace. This adds cost (your responsibility) and time to the process. Budget accordingly.

It’s not uncommon for a seller to schedule an inspection, then present the home inspection report (presumably free of any major issues) to prospective buyers. The seller is entirely within their rights to do this. But it’s important to have an additional inspection done by a certified home inspector of your choosing and not simply accept the findings of an inspector hired by an eager seller.

Finding a certified home inspector

Your real estate agent likely maintains a list of inspectors they trust in your area. Alternatively, seek recommendations from family, friends, or colleagues who have recently moved.

If you prefer to search online, check out Home Advisor or the “Find an Inspector” tool on the American Society of Home Inspectors (ASHI) website. ASHI certifies inspectors who pass an exam and pledge to follow a code of ethics and professional standards. It also publishes a state-by-state list of home inspection regulations.

Key questions when hiring a home inspector:

• Are you licensed and bonded as required by the state?
• How much experience do you have?
• What are your fees?
• Do you offer specialized services?
• What communication methods do you use (email, text, phone)?
• Can I join you during the inspection?
• Can you provide references?

The home inspection process

If possible, attend your home inspection. This way you can see first-hand what the inspector sees, ask questions, and discuss any issues that may be uncovered. Attending also lets you get to know your (soon-to-be) new home a bit better, as the inspector will focus on things you might not have paid much attention to during the showing. This can be particularly advantageous for first-time homebuyers, who may not be familiar with the ins and outs of owning a home.

The duration of the home inspection process can vary widely, typically ranging from one to four hours, depending on the home’s size and condition. During this time, the inspector will prioritize critical areas including:

• Plumbing: Checking for leaks, monitoring water pressure, ensuring proper drainage and functionality of fixtures, and assessing the water heater’s performance.
• HVAC: Ensuring proper function and maintenance of the furnace and air conditioner, and assessing airflow throughout the home.
• Electrical: Inspecting the condition of wiring, switches, and outlets, verifying the functionality and adequacy of the electrical panel.
• Interior Space: Assessing the condition of walls, floors, windows, and doors to ensure they operate smoothly and are in good condition.
• Foundation, Roof, and Structure: Evaluating the structural integrity of the foundation, checking for any bowing or sagging in walls or window/door frames, and inspecting for signs of rotted wood or insect damage.
• Exterior: Ensuring the property is free of standing water and that landscaping and trees do not pose risks to the house.

Refer to AmeriSave’s home inspection checklist to help guide your inspector in thoroughly assessing all critical systems and features of the home.

What’s not included in a home inspection?

A home inspection is, by design, a high-level look at the home’s current condition. Your inspector can flag areas of concern, but they may not always be able to investigate suspected issues deeply. As mentioned above, they may recommend that other specialists come to the home, when appropriate, for a more expert look.

An inspector will also be constrained by what they can and can’t see. Carpeting, walls, furniture, and landscaping may limit their access to certain home areas.

When shopping for an inspector, ask if there are any specific areas they don’t include. Don’t be surprised if a standard inspection doesn’t cover things such as the sewer and other underground lines, swimming pools, landscaping, the fireplace and chimney, or pest detection.

Finally, note that most inspectors’ liability is limited to the fee you pay for the inspection. This means that if the inspector misses something that ends up costing you, the most you’d be able to get back is your inspection fee (unless you hire an attorney and file a lawsuit).

Differentiating major and minor home inspection issues

Even for a newer, well-kept home, you may be surprised at how many issues the inspector flags in their report. Remember that the inspector’s job is to note both major and minor issues. And while you may want to ask the seller to address major issues (such as a needed roof replacement or furnace repair), it’s likely not worth your time and effort to nitpick the minor stuff (such as scuffed paint in the foyer).

One of the benefits of attending the inspection is the opportunity to talk to the inspector about what issues might be potential deal breakers. Your real estate agent can also provide guidance about what’s worthwhile to address with the seller.

Negotiating with the seller for the cost of repairs

Hopefully, the inspection reveals no major issues, and you can move forward with the close. If, however, the report does raise some red flags, you have a few options.

• Ask the seller to handle the needed repairs or replacement, at their expense, before closing.
• Get an estimate for the needed repairs or replacement. Then, ask the seller to adjust the sale price to account for the value of the estimate. Have the repairs completed after you close the sale.
• Walk away from the sale. This may be your best course of action if the seller is unwilling to be financially responsible for any major work. Remember that you should get your earnest money back if the purchase contract includes a home inspection contingency.
• Have the repairs completed at your own expense, without the seller’s financial support, after the sale closes. This may be the best and most reasonable option for a fixer-upper, provided the home is priced accordingly.

Once again, you’ll want to discuss the pros and cons of these approaches with your real estate agent and decide what is best for you.

A little peace of mind goes a long way

The cost, time, and effort of finding a home inspector and attending the inspection may seem like a hassle — one you don’t necessarily need when trying to close on a home. But consider the cost to repair or replace your new home’s air conditioning unit or roof, or the uneasiness you may feel if you’re unsure whether the home has any issues.

Fact is, a home inspection is likely very worthwhile. It can help you avoid some future repairs and other unpleasant surprises and become a new homeowner with peace of mind.

Frequently asked questions: Home inspections

What are the most common problems found in home inspections?

According to top home inspectors featured on HGTV’s House Detective, common issues include faulty wiring (especially in older homes), problems with the roof, HVAC defects, and plumbing issues such as leaks or outdated systems.

Common Deal Breakers in a Home Inspection:

ASHI advises buyers to watch for the following concerns:

• Pests and infestations
• Improper wiring
• Issues with the roof and/or foundation
• Lead-based paint hazards
• Plumbing problems (evidenced by low water pressure or signs of leaks)
• Malfunctioning wells
• Presence of radon gas
• Home’s positioning in a flood-prone area
• Mold growth
• Problems with the septic system

Any of these issues can be extremely costly and time-and-energy-consuming to remedy. They may require changes to the terms of the purchase contract, or ultimately cause the home sale to fall through.

Should I be nervous about a home inspection?

Nervous about a home inspection? It’s understandable. You’ve put in a lot of time and effort into finding a new home, and you know that moving forward with the closing hinges upon the inspector’s report.

Just keep in mind that knowledge is power. Knowledge can also save you a lot of money and headaches in the long run. If the inspection finds any major problems or safety issues, you should (provided your purchase contract has an inspection contingency) be able to renegotiate with the seller before the sale closes. You don’t want the seller’s issues with the home to become your issues.

Check out AmeriSave’s home inspection checklist to better understand all an inspection includes.

Why is it important to attend the home inspection?

By attending the home inspection, you can see what the inspector sees, discuss any issues they uncover, and ask questions. It’s also an excellent opportunity to get to know the home better and focus on things you might not have looked closely at during the showing.