Before you waive the home inspection to secure your dream home, remember it’s the biggest single investment most people will ever make. Consider potential costs, and explore alternatives. Don’t make a huge mistake just because of the limited inventory in the 2022 real estate market.
Experienced Realtors know that a home inspection contingency can make or break a deal in today’s market, but is it wise to waive it? Having one can save the buyer time and money, hassle, and prevent them from buying into a home that’s ready to collapse. When the buyer has it, they can negotiate or back off their offer if the inspector finds something really wrong the property, as long as they do it within the stated time frame.
In this competitive real estate market, many buyers are tempted to waive the inspection because of the limited inventory. If you do this though, any repairs needed from a new heating unit to new wiring become your responsibility. Taking a gamble like that used to be unthinkable, but Realtors say more and more people are willing to take the chance. With sellers getting dozens of offers, every advantage helps…so why not?
The Best Realtors Advise Their Clients Not To Do It
Sondra Richard, a Baton Rouge realtor, told WAFB news she now shows more homes virtually amid the coronavirus pandemic.
“We’re looking through this home and everything looks great, don’t it,” Richard said.
But Richard warns looks can often be deceiving.
“You want to make sure you hire a professional inspector that can put their hands on [everything] and make sure really that you’re not buying a lemon,” Richard said.
“I’ve seen a lot of things break after someone gets in the home and then they are just out of luck,” Richard said. “You need to have that inspection done because if you don’t, then your home warranty might not cover it either.”
A full home inspection can discover everything from structural issues, roof problems, faulty electrical wiring, plumbing issues, or even safety hazards. If you don’t want the hassle, expense, and frustration of dealing with unexpected issues like these, you’re better off getting it inspected.
You Lose Negotiating Power
Buyers with a contingency have asked for ten of thousands in concessions for repairs after getting inspections. In one instance a buyer asked for a $50,000 concession for a beautiful staircase on the verge of collapsing. Knowledge is power.
It Can Backfire
What happens if you waive the inspection and find out later there’s a cracked heat exchanger that’s more expensive to repair than to replace? If you’ve already used most of your money to buy the house, you will more than likely have to use a credit card to replace it. Then another repair comes along, and before you know it you’re bogged down with both your mortgage payments and credit card debt from home repair costs.
If you’re set on waiving an inspection, make sure it’s on a home that will leave you with enough money after closing, just in case something major comes along.
There Are Plenty Of Alternatives
A lot of sellers try to avoid accepting an offer if it means they could lose money negotiating after the inspection, but it’s possible to compromise on this.
- Buyers can agree to pay up to a certain amount in repairs when making their offer. This allows the buyer to get an inspection, and back out if the repairs cost too much. This also lets the seller know the offer is serious.
- Buyers can ask for an inspection for “Information Purposes” to let the sellers know there wouldn’t be any negotiations or requests for repairs later. In this case you could still back out of buying the home. You might have to forfeit some of the earnest money you’ve put down with your offer, but not if you’ve worded your contract right. The more strings attached the less likely the seller will accept it, but an information only inspection would let you look at potential costs, but still back out if it feels like too much.
- Buyers can ask for a pre-inspection, which is a shorter inspection that checks the main systems of the property, before placing the offer. The risk with this approach is that seller may choose another offer, but you still have to pay for the inspection.
- Buyers can shorten the inspection period. Shortening the inspection contingency is often the next best thing. Some inspections now are ‘as-is,’ where a buyer is stating that they will not ask for any repairs after the inspection. Placing an as-is inspection that is one or even two days long is still competitive, and allows a seller to quickly move on to the next offer if things don’t work out.
- Have a contractor or inspector attend the showing with you. “Having a trusted contractor or home expert walk the home with buyers prior to making an offer is always a good way to learn more before taking the risk. At least then the buyer has an idea of the home’s condition from an experienced professional and feels more confident about their choice to waive inspections.” — Tim Garrity, co-founder of Copper Hill Real Estate
If You Skipped The Pre-Purchase Inspection Get One As Soon As You Close
It’s not just about the repairs, but it’s about how to maintain and protect your home. Preventative maintenance is less costly than repair or replacement, so it’s critical to understand your home’s maintenance items. There may even be hazardous conditions like bats, termites, or asbestos present. Knowing about these conditions will help you be able to plan ways to take precautions to reduce risks to your safety, correct the issue, or mitigate damage before it gets worse.
If you would like to schedule a home inspection in Northwest Louisiana, call Clifton Gill with Honest Home Inspections, LLC.
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