Buyer’s Inspections Explained – Indiana

Ordering Buyer’s Inspections

I will encourage you to order your buyer’s inspections as soon as you are under contract to purchase a home. The deadline included in the purchase agreement (typically anywhere from 10 to 15 days), goes quickly and we want to make sure you have the opportunity to assess its condition.

At minimum, I recommend a whole home inspection. This will cover things like:

• HVAC
• Water Heater
• Foundation
• Roof
• Electrical
• Plumbing

If a property is on a well and/or septic, it’s smart to also order these tests from your inspector.

A Pest Inspection will look for termites, carpenter ants and evidence of past or current pests in the structure. Some inspectors are licensed to complete Pest Inspections, others are not. It’s a good idea to ask when interviewing inspectors.

Additionally, some types of loans will require certain inspections.

For instance, a VA loan will require a Termite Inspection Report paid for by the seller to complete financing.

If a home is on septic and well, a USDA loan requires a location report of the septic and the well to ensure they are not too close to each other.

An FHA and several other types of government backed loans will require a well water test. This is also an extra test that should be ordered at the same time you order the whole home inspection.

Best advice is to ask your lender up front, when you are Pre-Approved, if your loan type requires an inspections/tests.

Buyer’s Inspections Appointments

You won’t need to be present for a Pest, Well/Septic or Water Test appointment but a lot of buyers do want to talk with the home inspector about the whole home inspection.

Inspectors are in the crawl space, attic, on the roof and lots of other places as they work through the home. That makes it next to impossible to talk with someone or have someone following them around.

Because of this, they typically ask buyers to show up about 30 minutes prior to the appointment concluding. That way they have all their information and can intelligently speak with you about the condition of the home.

Standing around in the kitchen or living room of your new home makes it way easier to discuss the results that if you are climbing ladders or in crawl spaces!

Let the professionals do the job you hired them for and then meet with them towards the end for results. Everyone is much happier and productive this way!

Inspection Report

Within a day or so, we will receive the official buyer’s inspections report(s).

Now, expect it to be 30 to 60 or so pages depending on the size of the home. This is TOTALLY NORMAL!!!

The report will be broken down into sections so it is easier to read and digest. There is usually a summary area as well that will list report items by importance. While every inspector is a bit different, here’s an example of how they rank importance of items:

• Safety and/or High Importance: These items are usually flagged in red. They might include things like double tapped breakers, GFCI outlets needed near water, water in the crawl space, a roof leak, etc,..
• Medium Importance: These items are usually in yellow and might be things like: Wood rot, Brick Damage, failed window seal, etc…
• Maintenance Items: These are usually items that are more for your information and/or need to be watched for future maintenance. Things like gutters need cleaned, sidewalks settling, outside spigot not tightened, sink drain stopper not working, etc…

We will go through the report and identify the issues that you would like the seller to repair prior to closing.

Negotiate Inspection Response

We do have to keep in mind, the Indiana Purchase Agreement specifically states what is considered a “Defect.”  These are the items we want to concentrate on.

Since no home – EVER – is perfect, and it is a home inspectors job to point out every little thing, we have to use the definition of “Defect” when deciding what to ask for. (see graphic on the right)

When we weigh the definition of defect against the individual items on the report, it gives us clarity as to what to ask for.

For instance, an active leak under a sink or into the attic is definitely something that could have an adverse effect on the value of the property in the future. An active leak of any kind is definitely a defect.

If there was water in the crawl space, that could affect the foundation/structure of the home if not remedied.

Not having GFCI outlets near water and as outside outlets leaves the possibility of  someone getting hurt (safety issue.)

Things that are not actually defects would include maintenance it

ems or small repairs most homeowners will always have or more aesthetic items.

• Gutters need cleaned
• Paint colors not to your liking
• A door dragging on the carpet
• Gutter Extensions

These things are usually pretty easy to deal with and not a major defect.

Another item an inspector will call out but a seller doesn’t have to fix is when a mechanical item or say a roof is close to the end of its life.

There are average lifespans for most items but if they are in working order at the time of the inspection, we cannot ask for them to be replaced. Some items last well past their expected life.

If an inspector says the roof is within 5 years of being replaced, we can’t ask for a new roof. It’s still working, doing its job. This is considered “preventative”, not a defect since no one can 100% guarantee when it will fail.

Simply being close to the end of its lifespan is not a defect. The inspector is just letting you know that you may have to replace this item in the future.

Basically, “If it ain’t broke, they don’t have to fix it.”

Once we formulate your Buyers Inspection Response, it will be sent to the listing agent giving them a deadline to respond. There are basically 4 outcomes to our response:

• They can counter our response and we continue back and forth until we come to an agreement.
  • They can offer a certain allowance to be paid to contractors of your choice to repair the items we requested.
  • You do not have to agree to this, but it is an option. Again, we negotiate back and forth until we come to an agreement.
• They can accept our terms and we move on toward closing.
• If they miss their deadline to respond, they are agreeing to our terms by default and we move on toward closing.
• They can refuse to repair anything, in which case they refund your earnest money deposit and we mutually agree to release each other from the purchase contract.

It may seem like a lot to digest, but we’ve been through hundreds of buyer’s inspections and will guide you through, too.

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