Next steps after the inspection
Once your inspection is completed, the inspector’s report will be sent to whomever paid for the inspection. Usually, it’s the buyer, but the seller may schedule a pre-inspection before listing the home.
So, after the home inspection, what is next?
1. Buyer will review the report with their agent
The buyer’s agent will help the buyer understand the inspection report and decide whether to buy the house, ask for repairs, or cancel the purchase contract based on the inspection findings. The inspection report can be 30 to 40 pages long, says Hyatt-Zack, so having an agent to help understand the results is helpful.
It’s important to note, the inspection report belongs to the buyer who paid for it. It’s part of a legal business agreement between the buyer and the home inspector. Even though it’s your house, the only thing the seller receives is a repair request, if the buyer creates one.
Unless there is an extraordinary exception, sellers will generally only get a copy of the inspection report if they paid for part of it, which can sometimes happen through shared closing costs.
2. List of repair requests sent to seller
A buyer typically has two to three business days to review the home inspection report and ask for repairs.
Just about every report contains a list of suggested repairs, as well as health and safety issues. It’s up to the buyer and buyer’s agent to determine which are reasonable to request the seller to fix.
Generally, cosmetic issues, renovations, or updates you want to do, landscaping, and repairs to outbuildings are considered unreasonable repair requests. You should stick to health and safety issues. Anything related to the electrical system (faulty breakers, improper or defective wiring, rusted panel boxes), plumbing (leaks), HVAC (damaged ductwork, inoperable system, faulty thermostat), roof (leaks, damage to shingles, chimney, flashing), or structural defects (wood rot, broken framing) may be fair game.
Buyers can also ask for removal of asbestos, lead paint, mold, and mildew.
3. Seller reviews and crafts response
The seller’s options in response to the buyer’s requested repairs are:
- Make the repairs
- Negotiate which repairs to do
- Refuse to do any repairs
In many states, nothing is labeled as a “must-fix.” Therefore, the seller is under no obligation to perform any repair. “The seller doesn’t have to fix anything,” Hyatt-Zack says — at least in North Carolina, which is a “buyer beware” state in which the seller doesn’t even have to disclose any issues. It’s all up to the buyer to perform due diligence.
When the seller isn’t legally required to make repairs, the decision to do so often relates to the market. In a buyer’s market — or any time the seller is eager to sell — it’s more likely that the seller will agree to make at least some of the requested repairs. Even so, Hyatt-Zack says the buyer should “pick a few important things” to focus on. The buyer may have added contingencies in the offer whereby if the inspection revealed flaws, the buyer can back out of the sale.
In a seller’s market, the seller may have less inclination to fix anything — and may have other offers already on the table without contingencies. “Because of the [current] market conditions,” Hyatt-Zack points out, “sellers are less willing to fix things.”
A seller may offer a credit or financial concession, reducing the price of the home to allow for the buyer’s cost to fix any issues. However, some lenders require specific issues (such as rot, insect damage, or moisture problems) be addressed before a loan is funded. Nevertheless, if the seller refuses, the buyer can walk away and usually get their earnest money returned.
4. Buyer and seller make an agreement
Once the buyer and seller have come to terms with any repairs, they make any necessary updates to the agreement of sale (aka contract of purchase, contract for sale, sale agreement, or contract agreement).
5. Sale moves forward to appraisal and closing
Once the inspection period is finalized, the sale will move forward into the appraisal and closing stage.
Lenders require an appraisal to determine the current value of the property. The sale price and other terms can change or be negotiated if the appraisal is low.
The closing process also includes a title search and the buyer’s mortgage underwriting before the closing date. Any one of these steps can delay or even undo the closing, so make sure to keep up with any requests from your agent during this time.
What happens if problems are discovered
A thorough home inspection will list items of concern in and around the home. Inspections can uncover a myriad of concerns, from minor issues to major problems. Some of the more common findings include:
Structural damage
The inspector will look for things like cracks in the home’s foundation, drainage issues in the basement or crawl space, and deteriorating brickwork or masonry. These issues could be costly to repair and are mandatory in some states.
Roof damage
Another costly item is roof repair. An inspector will look for missing or broken shingles, tilting, and other damage. The inspector will also inspect the gutters to see if they are clogged.
Chimney issues
The inspector should look for damage to the bricks, mortar, and flue. It’s also critical to make sure the interior is free of blockages. Fixes could range from a simple chimney sweep to major structural repairs.
Wildlife and pest infestation
While inspectors are examining the foundation and the chimney, they will also be on the lookout for a pest problem. If there are any signs, the homeowner should consult a pest inspector to assess the extent of the issue.
