When do you exactly order a home inspection? Is it after you have an accepted contract agreement. Here in California, a home inspection usually costs a few hundred dollars. Does the seller pay for the home inspection? What if the home inspection report reveals that the cost of repairs is so much that your anticipated profit is actually going to be a loss? Help, can someone clarify? ???
HIs are usually ordered after you have a signed agreement. In that agreement it will say something like if you are unsatisfied with the inspection results, the price is open to renegotiation or the agreement will become voided if you can’t come to a resolution with the seller. Get the actual clause legalese from a lawyer or RE agent because every state is different. Usually the buyer is responsible for paying the inspector because they are the ones interested in the condition of the property. There’s no reason a seller can’t pay for the inspection, especially if your in a slow market.
Under Calfornia real estate law the buyer has the right of inspection for 17 days (unless agreed otherwise between the buyer and seller) after agreement has been reached. If the buyer finds anything that he/she doesn’t like about the property, he/she may void the purchase contract. The seller, of course, has the right to object to the reasons for the invalidation. But, realistically, it is very difficult to force a buyer to buy when they don’t want to. Generally, it is the buyer’s (or the agent’s) responsibility to order and pay for the inspection. This is the rule but, as in most parts of a contract, this is a negotiable item.
I can generally find a number of ways out of a purchase contract if the buyer wants out:
- The inability of the buyer to get a loan (a contingent item).
- The inability of the buyer to get a loan at the interest rate desired (another contingent item).
- If the appraisal of the property is not high enough (another contingent item).
- If the Wood Destroying Pest Inspection report comes back listing too many pests and the seller won’t repair the listed items.
- If the Natural Hazard Zone Disclosure Report lists dangers the buyer does not want to take.
- If there are items on the Transfer Disclosure Statement that the buyer does not like - note that there is a special time requirement related to the delivery of this report.
I can generally find four or five more ways out of a contract but these usually suffice.