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Monday, March 25, 2013

What is a Home Inspection Contingency?

By Elizabeth Weintraub, Guide

Home inspection contingencies are handled differently across America, depending on local custom and state laws. In most states, a home inspection contingency is part of the purchase contract. This means a home buyer can cancel the sale or try to negotiate repairs based on the results of a home inspection. In other states, generally on the East Coast, home inspections are conducted before entering into a contract to purchase.

If you don't believe that a home inspection contingency is a big deal, listen to this. A seller in Minneapolis once agreed to a very attractive sales price for his home -- many thousands of dollars below market value -- because I presented a purchase contract without a home inspection contingency. These types of contingencies are a major factor in many real estate transactions.

Now, in California, a buyer has a little over 2 weeks to conduct a home inspection. Standard contract verbiage gives California buyers 17 days. That period of time can be shortened or increased during offer negotiations.

Types of Home Inspection Contingencies to Satisfy

A general home inspection involves many components, which are primarily structural and visual, meaning whatever the home inspector can actually see. However, most home inspectors are not licensed nor qualified to discuss areas of concern that may extend beyond the home inspector's ability or training.

For example, if the home's water pressure is low, the home inspector will note the low pressure on the home inspection and suggest that buyer hire a licensed plumber for further investigation. There could be tree roots growing into the plumbing system or the plumbing pipes could be corroded, none of which a home inspector can tell by looking at it. If the home inspector suggests further inspections in the report, you may want to call a specialist for advice. Some of those types of home inspections could be any of the following:

·         Pest and Termites

·         Chimney

·         Electrical

·         Heating and Air Conditioning

·         Lead-Based Paint

·         Easements and Enroachments

·         Foundation and Basement

·         Roof Inspection

·         Sewer or Septic System

·         Soil Stability

·         Trees and Vegetation

·         Water Systems and Plumbing

·         Mold

·         Radon / Methane Gas

·         Asbestos

·         Formaldehyde

·         Permits and Zoning

Home Inspection Contingency Expiration Date

To determine the date that your home inspection contingency needs to be released, you should read your purchase contract. If it possible that once your period has expired, your earnest money deposit may be at risk if you try to cancel the contract based on a defect disclosed in your home inspection. It is also possible that your contingency period not does not automatically expire unless you take a specific action such as signing a contingency release.

This is why it is imperative to conduct your home inspection as soon as you possibly can. If the home inspector recommends that you call an HVAC specialist to do further investigation of the furnace, for example, some heating contractors might not be immediately available to you. You don't want your contingency period to expire before you have an opportunity to complete all of your inspections.

My name is Scott Grebner and I have been helping my clients realize their own personal real estate dreams. Real estate is a relationship-based business that works best when client relationships are built on trust and confidence. My goal is having clients be completely satisfied with the professional and caring service they have received.
The role of technology is rapidly changing how the real-estate market functions in this country today. Gerharter Realtors is embracing these new mediums of communication to better serve our customers. We have created our e-family to better place important information in your hands to help you with your housing needs. As a part of Gerharter Enterprises we have access to a broader range of additional services and resources to better assist you.  Visit me at my Web Site, Blog, Facebook, Twitter, You Tube or Pinterest.  Please check out our helpful resources on Sellers Tips, Buyers Tips, Foreclosure Tips, and Mortgage Tips. For a personal consultation please visit our Office.

It seems that the dream of past generations was to pay off a mortgage. The dream of today's young families is to get one.  I would love to hear from you, about your Real Estate Dreams and questions.
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