Selling Your Home - Should You Consider a Home Inspection?

If you are putting your home up for sale, should you consider having your own building inspection? Should this be part of your "pre-sale home improvement" process? The answer is "Yes."

Contingencies in Contracts

Once a buyer makes an offer and you accept it, you have a contract. One of the most common conditions of that contract is, "offer contingent upon satisfactory building inspection." The buyer is going to have a professional home inspector go through your house to make sure there are not any hidden problems.

The last thing that you want is to have your deal fall through because of an unknown problem uncovered by the buyer’s building inspector. This is especially true if it is a minor problem and could easily have been repaired ahead of time -- if only you had known about it.

Many a transaction has fallen apart because of building inspection surprises.

Preparing for Sale

When preparing your house for sale, you are going to do lots of things to make it more appealing to potential buyers. You are going to clean up the yard, apply a fresh coat of paint where needed, get rid of all clutter in and around the house, have the kitchen and all bathrooms at their sparkling best, get the rugs cleaned, clean all windows, etc.

Why not spend the relatively few dollars and also have a building inspection? Find out the hidden problems with your home and correct them in advance. If you don’t, you can be assured that the buyer’s inspector will find them. When the buyer’s inspector finds a problem, it can throw a monkey wrench into the works.

Potential Problems

The buyer will ask you to fix the problems found by their inspector – or no deal. If you do not want to fix the problems, they will ask for a reduction in price or a cash credit at closing – or no deal. In some cases, they buyer may even cancel the purchase entirely, not giving you a chance to make any corrections.

If the buyer cancels the purchase, where does that leave you? It leaves you with a house that you will have to put back on the market – a house that has been stigmatized. Future potential buyers and their Realtors will always wonder, "What happened with that first deal?"

An Item of Caution: Disclosure

If you hire your own home inspector and find problems but elect not to repair them, be sure to tell your Realtor They should be disclosed to all potential buyers. In some states this is mandatory. Home sellers and their Realtors who have known of problems but not disclosed them have successfully been taken to court for damages.

Think of yourself. Isn’t it easier to identify and handle problems in advance rather than finding out about them later? If there is a problem that you decide not to repair, disclose it up front and indicate that the estimated buyer’s cost to fix it has been reflected in the offer price of your home.

One should consult with a qualified mortgage professional prior to implementing any mortgage strategies.

If you are a tax, insurance, financial or financial planning professional receiving this newsletter, please call our office and introduce yourself to us. We are always seeking to grow our referral network and expose more service professionals to our client base.