After the Home Inspection, What’s Next for Sellers?

What does the inspection cover?

It’s basically a visual examination of the home’s structure and systems. An inspector will look at the roof and the foundation — and everything in between. Safety issues are key items.

The list of things you can expect to be covered by an inspection report include:

• HVAC
• Plumbing
• Electrical system
• Roof
• Attic, including visible insulation
• Walls
• Ceilings
• Floors
• Windows
• Doors
• Foundation
• Basement
• Structural components

Although the emphasis will be on these items, inspectors will also see if things like garbage disposals and carbon monoxide detectors are operational. They will also look for leaks, mold, and signs of water damage.

Prepare for an inspection

There are several things you can do that will make the inspection go more easily — and may earn you a better report. Try to look for what home inspectors look for.

Provide access. Make sure interior doors are unlocked and clutter is cleared from everything the inspector needs to see, such as the furnace and under sinks.

1. Clean house. The inspector’s job will be easier and more pleasant if your house is tidy and clean.
2. Replace burned-out lightbulbs. To avoid any question of faulty wiring or bad outlets, make sure all the lightbulbs work.
3. Clear around the house. Trim shrubs and move trash cans so the inspector can get a good look at the siding, trim, and windows.
4.  Flush the toilet. If it runs, get it fixed.
5. Test the pilot lights. These can be on your water heater, fireplace, and stove. Make sure they all work.
6. Tighten the hinges on cabinet doors. Make sure they hang straight and close well.
7. Shut the doors. Like with the cabinet doors, make sure they hang straight and latch properly.
8. Replace the furnace filter.
9. Label the fuse box. Make sure it’s accurate and legible. This will help you in an emergency as well as the inspector.
10. Check for leaks. Look under sinks, around faucets, at the base of the toilet, bathtub, and shower, and under the dishwasher and refrigerator.
11.  Look for signs of water damage. Examine walls, ceilings, and floors for warping, sagging, and buckling. Check the exterior for leaks and pooling water.
12. Eradicate bugs. Eliminate wasp nests and get rid of ants and any other noticeable insects.
13. Check the roof. Look for missing tiles. Clean out the gutters. Ensure the downspouts are positioned properly and functional.
14. Produce receipts for maintenance, updates, and other service done to your home, such as an HVAC service, a chimney sweeping, or a water heater service.

Be prepared for the inspector two hours before the scheduled appointment. Leave all utilities on and make sure the inspector has access to all areas. Take your pets with you when you leave.

Next steps after the inspection

Once your inspection is completed, the inspector’s report will be sent to whomever paid for the inspection. Usually, it’s the buyer, but the seller may schedule a pre-inspection before listing the home.

So, after the home inspection, what is next?

1. Buyer will review the report with their agent

The buyer’s agent will help the buyer understand the inspection report and decide whether to buy the house, ask for repairs, or cancel the purchase contract based on the inspection findings. The inspection report can be 30 to 40 pages long, says Hyatt-Zack, so having an agent to help understand the results is helpful. It’s important to note, the inspection report belongs to the buyer who paid for it. It’s part of a legal business agreement between the buyer and the home inspector. Even though it’s your house, the only thing the seller receives is a repair request, if the buyer creates one.

Unless there is an extraordinary exception, sellers will generally only get a copy of the inspection report if they paid for part of it, which can sometimes happen through shared closing costs.

2. List of repair requests sent to seller

A buyer typically has two to three business days to review the home inspection report and ask for repairs.

Just about every report contains a list of suggested repairs, as well as health and safety issues. It’s up to the buyer and buyer’s agent to determine which are reasonable to request the seller to fix.

Generally, cosmetic issues, renovations, or updates you want to do, landscaping, and repairs to outbuildings are considered unreasonable repair requests. You should stick to health and safety issues. Anything related to the electrical system (faulty breakers, improper or defective wiring, rusted panel boxes), plumbing (leaks), HVAC (damaged ductwork, inoperable system, faulty thermostat), roof (leaks, damage to shingles, chimney, flashing), or structural defects (wood rot, broken framing) may be fair game.

Buyers can also ask for removal of asbestos, lead paint, mold, and mildew.

3. Seller reviews and crafts response

The seller’s options in response to the buyer’s requested repairs are:

• Make the repairs
• Negotiate which repairs to do
• Refuse to do any repairs

In a seller’s market, the seller may have less inclination to fix anything — and may have other offers already on the table without contingencies. “Because of the [current] market conditions,” Hyatt-Zack points out, “sellers are less willing to fix things.”

A seller may offer a credit or financial concession, reducing the price of the home to allow for the buyer’s cost to fix any issues. However, some lenders require specific issues (such as rot, insect damage, or moisture problems) be addressed before a loan is funded. Nevertheless, if the seller refuses, the buyer can walk away and usually get their earnest money returned.

4. Buyer and seller make an agreement

Once the buyer and seller have come to terms with any repairs, they make any necessary updates to the agreement of sale (aka contract of purchase, contract for sale, sale agreement, or contract agreement).

5. Sale moves forward to appraisal and closing

Once the inspection period is finalized, the sale will move forward into the appraisal and closing stage.

Lenders require an appraisal to determine the current value of the property. The sale price and other terms can change or be negotiated if the appraisal is low. The closing process also includes a title search and the buyer’s mortgage underwriting before the closing date. Any one of these steps can delay or even undo the closing, so make sure to keep up with any requests from your agent during this time. Source