When purchasing a home, everything must be done according to the process. If you skip certain parts of the process, many problems could arise later. However, one part of the home buying process that could never be ignored is the inspection, where a home inspector will evaluate the condition of the prospective house you're trying to buy.
A home inspection is a document that lists many things that are wrong with the house or things that could go wrong. You may think that the inspector will warn you of everything wrong with the home, but there are some instances where not everything is recorded. Regardless, you should take it seriously, especially when it's done, because it can make or break a purchase.
Not many people know what goes down during the negotiation phase after the home inspection, so we'll discuss more about it in this article. Read on below to get started.
How Home Inspections Work
The process is pretty straightforward. The home inspector will visit the house you're trying to buy and evaluate the property's condition. They inspect every part of the house, from the roof to the basement, and develop a document that lists all the problems found. Everything will be documented, including notes about issues with the home.
If you're buying a house with a loan, the lender will send their own inspector at some point to evaluate the property, but it's highly uncommon for them to perform an inspection before you get your inspector's findings. When the review is completed, the report is sent to the real estate agent or listing agent, and they will give you a copy of the report.
Negotiating Mandatory Repairs
The report usually includes recommendations on issues that the seller should fix. These issues are called "defects" or "material defects," and they typically affect the sale of the property. If there's no evidence of a defect, then the seller won't have to make any repairs. This is where the negotiation part comes in.
Potential buyers can use the report to negotiate with the seller and try to get repairs done before the sale takes place. As a result, the seller will usually make the repairs if they want to close the deal. The warranties typically cover the most critical reported things, so the seller will usually fix them for you.
If the seller doesn't agree to fix it, you can use the report to negotiate a lower sale price. The seller wants to move house as soon as possible, so they'll make the repairs most of the time.
Every state has its own set of laws for home inspections. In most states, the seller is responsible for all defects, but the buyer is responsible in some states. Because of the differences in the law, you should consult with a real estate agent to find out about your state's regulations for the home inspection process.
The Negotiation Process
Negotiating the defects found on the home inspection report is a delicate process and should be handled carefully. After the seller receives the report, they usually reject it or deny it. They will usually say that the report is inaccurate and doesn't show the proper condition of the home.
After that, you'll have to call the listing agent and discuss your issues. Then, the listing agent will communicate with the agent representing the seller, and both parties will examine the report. Since this is a critical part of the process, you don't want to miss out on any details, so make sure you're available for many phone calls.
How Much Is Reasonable?
You should expect to spend the same amount of money fixing the defects as you pay to buy the home brand new. This includes the price of building materials, labor, and taxes. Keep in mind that an older house will cost more to fix than a new one.
If the seller refuses to repair the defects and will only offer you a low price, you'll have to consider whether it's worth it to buy the house even with all its problems. If you decide against the purchase, you'll have to wait for another home listed for sale.
Conclusion
A home inspection is necessary for buying a home, but it's also a tricky part of the negotiation process. Therefore, if you're purchasing a home from a seller, you should be able to negotiate the repairs with them. If you don't, you could end up with a house with many problems, and that's not something you want to risk.
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