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How To Avoid Making The Mistake That More Than 70% Of Home Buyers Make
How To Avoid Making The Mistake That More Than 70% Of Home Buyers Make
Submitted by: Michael Del Greco
You are considering (or in the process of) buying a new house! Congratulations! Purchasing a new home is a very exciting thing for anyone ' and I'm sure that you are no exception!
Perhaps you are moving because you have been promoted and can afford something bigger and nicer, or you are planning to have kids and need more space, or you are retiring and want to a new place to call home that reflects your new lifestyle.
Or maybe you just want to be closer to a relative or friend or the city.
Whatever it is ' you must be filled with hopes and dreams of a very happy future in the new home to-be! And you don't want anything to get in the way of purchasing that perfect home that will be the center of your life for at least the next few years!
To this end, you have to hire the right people to guide you through the purchasing process so that you aren't surprised later by things that you did not know about or did not know enough to ask about!
All Of Your Hopes And Dreams For Your New House Can Be
Quickly And FOREVER Squashed If You Don't Have The Right Consultants And Advisors On Your Side During The Purchasing Process!
Now, while advisors and consultants may take many forms, I urge you to hire at least two people to help you through the purchase of your new home.
Get A Lawyer!
The first person is a lawyer. There is really no way of getting around this.
A good lawyer will review your purchase contract and to advise you as to what your rights and obligations are before and after the closing. In particular, he will explain to you how you can get out of the contract if necessary, and try to negotiate better exit terms if he believes that they are unfair.
And, you will want to be able to get out of your contract if too many problems are found with the home you are looking at, right' So, you don't want to mess around with this!
The lawyer will also point out any unusual things in the contract or any other points that may be weighted to heavily in the seller's favor and therefore should be the subject of further discussions.
Believe me ' the few hundred dollars you spend will be worth the peace of mind that you signed a contract with terms that you truly understand and agree with!
And Who Else' A Home Inspector!
A home inspector is the other person that I URGE you to hire. And, as a homebuyer, there really is no way to get around this either! (You actually may be required to hire an inspector by your bank, insurance company or appraiser! Check your purchase documents if you're not sure.)
After all, this is likely to be the largest investment that you have ever made and perhaps will ever make ' and you (and your bank, etc) can't afford for you to approach it blindly.
And it's the home inspector who will physically go through the home and give you feedback that will help you negotiate a better purchase price! No one else will or can do this for you!
A thorough inspection is the ONLY way that you can uncover the less-than-obvious problems that your new home may have ' and which may eventually haunt you (either financially or personally) down the road.
Only a properly executed inspection will provide you with the most peace of mind and confidence in your purchase decision.
But I think that you know all this already. You know that a home inspection is a necessary part of the home buying process ' otherwise you would never have requested this report. Right'
So I am not going to try and convince you that you should have one done. I think that we are beyond that!
What I am going to talk about here is '
How To Retain A Home Inspector Who Is
Independent And Qualified!
You absolutely MUST hire a home inspector who's INDEPENDENT ' or you are opening the doors to being ripped off!
But what's an 'independent' home inspector'
Well, consider this.
Would you ever go to the seller of the house that you are interested in and ask for him to recommend a home inspector to represent you and help you find lots of problems with his house'
I don't think so ' unless you want to get a recommendation for the worst inspector in town.
Why would the seller want to help you find reasons for him to lower the price of his house'
No way! You would never go the seller for help!
You must hire an inspector who will look out for YOU ' 100% ' without any biases or conflicts with the seller!
Seems pretty obvious, right'
Well, maybe not!
Did You Know That Over 70% Of The Buying Public Get
Their Home Inspections Done By A Person Referred
By A Real Estate Agent!
That's right!
And whom does the Real Estate agent represent'
And there is the problem.
You see, you want to get the house at the lowest (if not fairest) price possible ' and therefore need to hire a good home inspector to find as many things wrong as possible with the house ' to help you negotiate a better and fairer purchase price or otherwise convince you to walk away.
But Real Estate agents and brokers are in the sales business ' closing deals determines their level of success.
Their commissions will only be paid if the deal goes through and will be reduced if your home inspector turns up anything that may lower the sale price of the home or sale commission amount.
So, agents really don't want you to hire a good home inspector who may get in their way!
No! They would be very happy to know that you have a lousy inspector!
And the big problem here is that some may go so far as to help you retain that lousy inspector ' without you even knowing it!
Now I am not saying that all realtors are incompetent or dishonest ' no this is just not the case. But there are some who tend to gravitate toward home inspectors who are less likely to threaten their sale.
And those are the realtors that you really have to watch out for.
Some of the unscrupulous practices that agents have undertaken to manipulate the inspector-retaining process include the following:
' Telling buyers that, 'We're not supposed to refer home inspector to potential buyers, but here are 3 names .. you decide.' (That is, of course, three inspectors that they wouldn't mind you hiring!) And the list will likely be long enough to protect the agent from any referral liability. Should you later have a problem with the property, the agent can simply say, 'Well, you chose the home inspector' or simply deny ever having given you the home inspector's name.
' Making a bunch of brochures or cards from their select group of 3 inspectors available at the reception area in their office ' in full view. And brochures and cards of the inspectors that the agent is less sympathetic to (and who probably would represent you better) are located in a less obvious place.
' Telling buyers to look up some names of inspectors in the Yellow Pages and then saying, 'But a lot of my clients have used 'so and so' and were very satisfied,' or 'But don't use that guy because he's too picky, too slow, too expensive, or he's a 'deal killer' etc..' (Of course trying to steer you to one of their approved inspectors!)
' Telling buyers that they should expect a home inspector to charge around $150 or $200. By advising homebuyers to expect such low and unrealistic fees, agents may steer homebuyers to search only for inspectors that will charge that low, which will likely be those inspectors approved by the agent.
' In the case of particularly aggressive agents, saying that, 'I'll look after the inspection for you. Don't worry, I know just the inspector to call..' (Stay clear of any inspector chosen by this guy!)
' Pretending to call a well-qualified inspector chosen by the buyer, and telling the buyer that they were unable to reach the inspector or say that the inspector is unavailable.
Pretty scary stuff, huh! If you see any of this type of behavior, you should without hesitation contact your attorney ' and obviously not take any of their referrals.
And The Culpability Does Not End With The Agents!
There are many home inspectors that rely on real estate agents and brokers for business. These inspectors want to get on (or are on) the agent's short list of preferred inspectors, which are referred to homebuyers.
But, to get on (and stay on) this list, inspectors have to 'play ball.' And they will not bite the hand that feeds them!
Now, you might be thinking ' 'No self-respecting inspector would purposefully make a delinquent report just to get in good with a real estate agent or otherwise to help get the sale through. After all, I hired him! He is supposed to represent me.'
Well, you're right. No self-respecting inspector would do this. But ' what I am trying to emphasize here is that not all home inspectors are self-respecting!
There are inspectors out there who will do whatever is necessary to ensure future referrals from agents ' including doing an inferior inspection that uncovers little to affect the agent's commission.
Now, Is This A Risk That You Really Want To Take'
Given this artificial marketplace of inept inspectors created by Real Estate agents, do you really want to rely on them for advice on good inspectors'
If a real problem is discovered with the house after the sale ' a problem that the inspector should or could have caught, but missed due to his conflicts or because he really is a lousy inspector ' you will be left high and dry!
And only one state thus far has enacted a law prohibiting this kind of behavior.
Others have used to the courts to crack down on it. (I have attached a recent New Jersey case that ruled against such unscrupulous tactics by a home inspector ' so that you can see for yourself what I'm talking about. It's pretty interesting!)
But You Don't Need To End Up In Court!
You Can Easily Avoid This Risk By Just Seeking
Out Your Own Independent Home Inspector!
The obvious thing to do to avoid becoming a victim is just not to retain a home inspector through a Real Estate agent. That's the easiest way to avoid hiring a less than independent inspector.
To be clear ' if you do hire an inspector through an agent, it does not mean that you are necessarily going to have a problem. But you really do open yourself up to the risk!
I market my inspection services to homebuyers directly ' and not through any of my real estate agents, brokers, etc. so as to avoid this conflict of interest problem.
It is really the only ethical way for me to perform my job. And any home inspector that you hire should do the same!
But you may be asking, 'If I have to go out on my own and find a home inspector, how can I be sure that he is independent ' or even qualified''
Well, after telling you some of the horrible things that go on with home inspectors and Real Estate agents, I'm not going to leave you stranded now!
The rest of this report outlines the steps necessary for hiring a qualified, independent home inspector. It also identifies things that you should do on the date of the inspection and afterwards.
I hope you find this helpful! Should you have any questions about this or anything, please do not hesitate to call me. I feel very passionate about this problem and am happy to talk to you about it and your new home purchase.
How To Get Your Home Inspected The
Right Way In 10 Easy Steps!
Hiring An Independent & Qualified Inspector
1) Find names of home inspectors with sources that do NOT have a vested interest in the sale!
You can find a bunch of home inspectors on your own by asking your attorney, going through the Yellow Pages or based on referrals from your friends or family ' basically any source that does not have a vested interest in the sale!
Now, just because you get the name from an 'independent' source does not necessarily mean that the inspector is truly independent!
One way to protect yourself is to ask the Real Estate agent for a list of home inspectors and see if the name referred to you is on it. Then you'll know that he plays on both teams!
2) Once you have gathered some names and checked them for independence, you should then get on the phone and 'interview' them!
The following questions are those that I think are good gauges for determining whether the inspector is qualified and should be someone worth considering.
These questions could be asked over the phone.
Now, if an inspector refuses to be 'interviewed,' drop him like an old shoe!
And I mean this! Good home inspectors like to help new homebuyers through this process and are very open to discussions about themselves, their abilities, their certifications, their services, etc.
Refusal to want to be interviewed is likely indicative of you having found an inspector who really does not have much backing up his ads!
CAUTION: Because many inspectors are 'one-man' operations, don't mistake a comment like 'I don't have time now' with a refusal to answer your questions over the phone. Just ask him when would be a good time to call and schedule an appointment for the 'interview.'
Now, following each question, I have provided answers that reflect the home inspection services that I provide which you can use as a basis for comparing services offered by other home inspectors. You can ask the questions in any order.
a) What kind of formal INSPECTION training have you had'
You should never assume that a background in construction trades, engineering or other building fields is a substitute for training as a home inspector.
But you shouldn't completely rule out an inspector who doesn't belong to a professional association, if you know that the inspector has a good reputation and has been in business for a number of years.
I have been a full time home inspector since 1993. I have been certified by and a Member of the American Society of Home Inspectors (ASHI). In order to become a Member of ASHI, I had to pass the National Home Inspector Examination and ASHI's Standards of Practice and Ethics Examination. I also had my inspection reports successfully verified for compliance with ASHI's Standards of Practice and submitted valid proof of performance to demonstrate my home inspections and reports meet or exceed the ASHI Standards of Practice.
My ASHI Membership number is 102273. You can call ASHI and verify this or go to their website. Their phone number is (800) 743-ASHI and their website address is www.ashi.org.
I hold State of New Jersey Home Inspectors License # GI0121. It is very important that you ask whether the inspector is licensed in New Jersey, many inspectors do not meet the minimum qualifications necessary to have a license. Ask to see the inspectors License and State Issued Home Inspectors Identification Card at the inspection. If you want to know if an inspector is licensed go to:
www.state.nj.us/cgi-bin/consumeraffairs/search/searchentry.pl'searchprofession=1241
My outstanding qualifications allow me to serve as an instructor for the State of New Jersey Home Inspectors Licensing class ' where I train students, to prepare for the National Home Inspector Licensing Examination, in all areas of home inspection, including roofing, air conditioning, heating, plumbing, structure, electric, interior, exterior, reporting, professional ethics, standards of practice and New Jersey State Regulations.
I also am licensed to perform wood-destroying insect inspections and radon measurement. I am bonded and insured for your protection. For more information about my inspection training and background, please visit www.AccurateInspections.com to see my resume.
b) How long have you performed inspections and how many inspections have you completed'
The more inspections that the inspector has performed, the better. Inspections in excess of 1,000 are a pretty good indication that he has been around the block bit.
I started Accurate Inspections Inc. over 10 years ago (1993), and have completed over 5,500 inspections during that time. Before 1993, I was a construction project manager for 7 years.
c) What geographic areas do you cover' What types of homes do you generally look at'
I cover all of Bergen and Passaic counties and portions of Essex and Morris counties in New Jersey. I limit my coverage to these areas so that I can provide my clients with better services. I also typically limit my inspection services to residential properties representing homebuyers in home purchases, but also have experience with commercial buildings.
Watch out for inspectors that cover too large of an area, like an entire state. There is no way that these inspectors could have a feel for the community that you are trying to move into and the local codes or ordinances that the property may be subject to.
d) What do you charge' Do you offer any other services besides home inspection services'
The costs are an obvious question that you have to ask. But remember ' the cheapest is not necessarily the best deal. Consider costs along with the other factors identified in this report.
If you want a cheap inspection, we do not offer one! We used to when we were trying to gain experience, now we offer the best value for your money! Short term we cost more, amortized over the time you are in your home, the extra cost will be perceived as a great value.
Some homebuyers will also need a PWTA well test, which costs about $500, and an open pit septic inspection, which costs about $ 425.
In addition to the traditional home inspection services, I also can perform radon measurement, carbon monoxide measurement, well-water testing in conformance with PWTA requirements, wood destroying insect inspections and schedule asbestos, septic and lead testing.
e) Can you make repairs if they are needed'
If the inspector says "yes" -- LOOK OUT! This raises the same conflict of interest problems that I talked about before. If he can make money on you after the sale transaction is closed, he will have a vested interest in the outcome of his report and may overestimate the problems with the house.
I don't do any repairs and I refuse to make estimates. In fact, I am bound by ASHI's Code of Ethics, which forbids any actions by me that could be viewed as a conflict of interest.
f) How long does your inspection take'
You should be careful if the inspector sets any fixed time limit on the inspection. An inspection can only be considered complete when you are fully informed as to what the inspector has found.
I will take whatever time is necessary to tell you all there is to know about the home ' and only at that point will my inspection be done.
But, to provide you with a general estimate, my inspections usually take about 2 hours to complete, depending on the size, age and components of the home. This is consistent with the standards required by State of New Jersey law as well as ASHI and ensures that you will receive a thorough and high-quality inspection from me.
g) Can I walk with you through and ask questions during the inspection'
Some inspectors may not permit this. It is really a que
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