CO Home Inspection Giggles and Gotcha’s
Once under contract to buy your new property, the buyer has a couple of really important pieces of homework to do in the first week or so.
- Get the EM deposited with the listing agent or title company
- Work with the lender to get him/her all the documentation they need for the new loan
- GET A HOME INSPECTION
Sure, a home inspection is not mandatory, but in my humble opinion you’d be a fool to spend that kind of serious money on a place you haven’t thoroughly checked out. It’s $500 well spent!
In the contract to buy, you agreed on a date by which the buyer would/could terminate the deal or ask the seller to correct issues. This is the Inspection Objection Deadline. If you find the house is not what you thought it was – needs a new furnace, has foundation issues, the roof leaks or the sound of the train in the back yard is just too unbearable – you may simply terminate the deal, ask for your Earnest Money Deposit back and call it good, as long as its done by midnight on the night of the Inspection Objection Deadline. If you use this deadline to ask the seller to fix the leaking roof and replace the furnace, the seller and buyer then have a second deadline by which to come to mutual agreement. The Inspection Resolution Deadline. Failing to agree on a resolution of issues will result in an automatic termination of the Contract to Buy after the Inspection Resolution Deadline has passed. No the seller cannot use this deadline to force you out of the contract to buy if they have received a better offer since you signed. We can talk about that as needed though.
About those train tracks… While some might say that asking the seller to move the train tracks is unreasonable/impossible, it can also be argued that if the seller never mentioned that a train whizzed by the back deck 4 times a night and shook the baby awake, they were also being unreasonable too. One might argue that a negotiated reduction of the purchase price could help the buyer come to terms with installing new triple pane windows or paying for prescription Ambien! No, I don’t agree that a buyer should nickel and dime a seller in order to claw back some of the purchase price, but I do agree that if you offer a price and believe you are getting one thing, then find out something less favorable is part of the deal, a conversation should ensue. I have had buyers of one of my listings ask for such things as “tighten the knob on the laundry cabinet” and “install a second water heater” (when the first one was brand new!) and it’s so annoying to the seller that the seller digs in their heels and won’t work with the buyer on real issues – water leaks, windows that fail to close and lock properly, high radon results etc. Negotiation is art and science combined. I’ll help you with strategy and wording so that you have the best chance to get the things that matter, dealt with before closing.
Let’s get the scoop on Dallice’s recent CO Home Inspection
It was mid December. I called my favorite home inspector and scheduled him for the next Saturday. He arrived and started the way he always does… On the outside, checking the driveway, roof, siding, gutters, grading. Inspectors generally don’t do pools, sprinkler systems, hot tubs or outdoor lighting FYI, so I lifted the lid on the hot tub, swirled a finger it it to test the temp and cast an eye over it, looking for scum, mold, slime or other indicators that the owner had stopped maintaining it. I found hot water, clean and fresh smelling, which totally made sense when you see the shelf of products and instructions for the hot tub in the laundry room. If you were more detail oriented in the hot tub department you could call a spa specialist and pay them to come and inspect it separately for you.
Then Dave the inspector moved inside. Room by room, category by category he checked the house. On the list was doors and windows, electrical, plumbing, Heating and Cooling, Appliances (kitchen), garage, insulation etc. In my case, there was also a scoping of the main sewer line going on. My new purchase is located in Southmoor Park, Longmont. Its a neighborhood that sprang up in the 1960’s and as such has a lot of large, mature trees… Trees who’s roots can infiltrate and block the clay waste water line that connects the house to the main city line under the street out front.
He got out his hydraulic leveling device and mapped the ups and downs (by the 0.1″) of the house, room by room. He used his thermal imaging camera to scan walls for missing insulation and pipes for water leaks.
Two hours later and I felt pretty good about the house. But here is the thing; I am a Realtor. I see home inspections every other week and am used to all the stuff they find. Even new construction will have issues! I have also been a home owner for close to 9 years and know what I can live with and what will keep me awake at night, cause my bank account to hemorrhage and what will develop into a bigger problem if not corrected soon.
For a first time buyer, a home inspection can be a scary, scary experience. You need a Realtor to hold your hand and reassure you that older homes have issues, just like older bodies. That’s normal. You need a thorough inspector who treats the property and the buyer with utmost respect and is NOT an alarmist. When you get the news that the sewer line is 50% blocked by roots in some places like mine was, you need to breathe, relax a bit and remember it’s totally fixable, not a deal breaker and we can ask the seller to have the roots cleaned out. When you find out the furnace is 15 years old and near the end of it’s life expectancy, it’s good to factor this into the plans for future spending, but also understand that the life of the furnace will greatly depend on the maintenance and use it received over the last 15 years too and look around at how the rest of the house was maintained for clues! Unlikely this will be a deal breaker if the furnace is still running well.
My favorite part of the inspection is the end. The last 30 minutes where the inspector gives you a quick run down of what he found; The quirks, the shut-off valves, things to see to immediately, things to keep an eye on, things to plan for in the next 5 years.
In my own house he found the plumbing that connected the waste disposal unit to the P-trap under the sink was “interesting”. Three guesses what this is….
Car geeks get it in one guess. Yep, the connection from the disposal to the drain pipe is with radiator hose… Attached appropriately with hose clamps! On the bright side, there are no leaks and while unconventional, it is actually doing the job OK. On the flip side, this creation of a second P-trap means the whole set up has the potential to act like a siphon and suck the water out of P-trap #1 and let sewer gas back up into the kitchen. Eeeww! This was clearly not a deal breaker for me and I added it to the list of “stuff that gets done after closing”.
In my case there were just a couple of issues I asked the seller to help correct. That sewer line cleaning (about $150), an electrician to look at potential aluminum wiring at the main panel in a couple of places and missing GFCI outlets in the kitchen. My opinion is that big ticket items and safety items are good things to address. The first because you assumed the house didn’t have an immediate need for a huge expense when you offered the contract price and finding out a new furnace ($5000) is needed, changes what you are actually paying for the house. The second thing (safety items) are important because you have family and pets who depend on you to keep them safe. Most sellers are fine with removing safety hazards for you before closing or as in my situation, crediting an appropriate amount to you at closing so you can then have them taken care of after closing.
NOTE: During the buy process your new home will also be visited by an appraiser. He/she will be checking for habitability. Is there a functional kitchen, bathroom, heat system, roof OK, windows ok etc. So even if you don’t ask the seller for a new furnace, if it’s not working, the appraiser may make the loan contingent on a new furnace being installed before closing – and he/she will come back and check!
You will also be required to get insurance on the property in order to secure a new loan to buy it. Yes, your insurance agent will ask if there is a fireplace and when the last time the chimney was cleaned. They will inquire about the age of the roof etc too. While you might be OK taking the house in “as is” condition, your insurance agent and your lender will not be OK with a leaking roof, for example, and they will halt the deal until it’s addressed.
Summary: I had the house inspected, didn’t find a deal killer, asked the seller to remedy a couple of things and we agreed on a resolution by the Inspection Resolution Deadline. At/before closing I got a copy of the sewer clean out (paid) invoice and a credit for $200 for the electrical issues to be fixed by me after closing.