A home inspection is one of the most important steps in the homebuying process, though it can also be one of the most stressful experiences associated with buying or selling a home. The buyers, who may think they have found the perfect home, could end up learning about some major problems that force them to walk away from their otherwise perfect property. The sellers, who often don’t know problems exist until after the home inspection, might face expensive repairs that can feel like an added burden in the midst of selling a home. However, for buyers and sellers who stay informed and cooperative, the home inspection and repair process almost always benefits both parties.
Most of the time, a home inspection identifies repairs that range from minor suggestions to highly important and serious issues. In this scenario, both sides of the table wonder whether the repairs are mandatory after the home inspection in order to finalize a contract and close on a home. And when it comes to significant issues, buyers and sellers may wonder who pays for these repairs: After all, major problems often require expensive and time-consuming fixes, and someone has to take responsibility for the bill.
When it comes to home inspections, repairs, and contract negotiations, both buyers and sellers should gain a better understanding of what to expect during the homebuying process. Continue reading to explore some of the most important considerations and factors that determine whether repairs are mandatory after a home inspection.
The Purpose of a Home Inspection
During the homebuying process, buyers or sellers often choose to hire a home inspector. Certified home inspectors have the responsibility to inspect a home inside and out, identifying a variety of concerns that range from minor to major problems. Some of these issues may need to be addressed before buyers close on a home.
Trained home inspectors review a wide range of construction elements that reflect almost every component of a home. They, quite literally, check a home from top to bottom, from the roof to the foundation. Home inspectors test to make sure all of the home’s systems function properly, including electrical, HVAC, and plumbing. They also look for damage to the structure, including cracked foundations, water damage, and pest damage. Importantly, they identify both insignificant blemishes and detrimental problems that buyers and sellers can negotiate.
Both new construction and resale homes have home inspections during the homebuying process, although home inspections for new construction homes may include additional considerations. New homes, for example, often have two or three home inspections at different stages of the building process to explore different features of the property, from the foundation to the smoke detectors.
Common Problems Found During Home Inspections
Home inspectors work hard to find as many problems, big and small, as they can in the home. They also confirm the working order and safety of many aspects of a home. While home inspectors may find many smaller concerns, such as expected wear-and-tear or cosmetic issues, the major issues cause the most problems when selling or buying a home. A good home inspector knows to look for certain significant issues that often appear in home inspections.
One of the common problems found during a home inspection is an issue with a home’s foundation. This costly problem can cause a house to sag, lean, and even break if left unfixed. Likewise, a deficiency in the roof can cause structural damage in the form of water damage or insulation control. When it comes to water damage, bad plumbing and pipes can be detrimental to a home in the long run, and repairing this system often requires walls to be opened. The same goes for electrical systems, which can often require accessing and replacing wires within walls and ceilings.
Another problem home inspectors look for is evidence of pests and pest-related damage. While critters like spiders or centipedes may not be a deal-breaker for buyers, pests like termites can cause wood and structural damage that can be costly to fix. Home inspectors also look for problems with the HVAC or the heating, ventilation, and air conditioning system. These issues go beyond simply replacing heaters and air conditioners and can involve repairing vents in the walls.
Many of the problems found during home inspections (and ultimately repaired during the homebuying process) reflect major issues that impact the safety of a home. Most of the common problems that buyers and sellers need to address are those issues that, left unrepaired, can cause safety concerns in the future.
Are Repairs Necessary After a Home Inspection?
Homebuyers and sellers alike may wonder whether repairs are required after a home inspection, and who might be responsible for overseeing and funding any fixes. The answer, however, is that it depends.
Legally, sellers aren't required to make any changes after a home inspection. However, in exchange for avoiding repairs, sellers might lose a sale or even lose value in their home.
Some states, however, have alternative options that buyers and sellers can explore that lessen the burden of making repairs. In several states, like Florida, sellers can opt for an “as-is” contract that reduces the responsibility of the seller to make any repairs or fixes based on a home inspection. These types of contracts lower the seller’s liability and increase the buyer’s responsibility to buy a home in its current condition. Of course, buyers can still choose to walk away if a home inspection uncovers too many significant problems.
Most of the time, when a home inspection uncovers significant problems that make a home inhabitable, a seller takes care of these issues before the final sale of the home. A buyer might also make a deal to oversee the repairs for reducing the selling price of the home. Some of the major problems encountered during a home inspection that should be repaired include those that pose a substantial risk to health and safety, such as mold or water damage, fire or electrical hazards, and building code violations.
Negotiating With Buyers and Sellers
Home inspections may uncover repairs that buyers want fixed, but they can also reveal issues that the buyer’s mortgage lender or insurance company requires in order to approve loans or policies. As such, it’s important to recognize the balance between needs and wants, and low-priority and high-priority repairs, in the home inspection process.
In some cases, the results of a home inspection can cause financial institutions to deny a buyer’s loans or insurance policies. If the home inspection uncovers substantial problems, the bank has to be satisfied with the planned repairs. Though this represents a more rare case, sellers might consider these repairs mandatory in order to sell the home. But, that’s where negotiations come in between buyers, sellers, and their real estate agents.
After a home inspection, buyers and sellers often negotiate the responsibility and cost of repairs. Buyers may want sellers to take care of repairs before the final sale of the home, while sellers may prefer to reduce the selling price of the home in exchange for buyers taking the lead on repairs. Either way, buyers and sellers can work together to find a plan that works for both of them.
Importantly, the responsibility between buyers and sellers has to maintain a balance. When negotiating home contracts based on findings from a home inspection, buyers should prioritize the repairs that are most important to the home. Buyers can always make cosmetic changes after moving in, but at the stage of signing the final contract, buyers should prioritize their concerns with guidance from their real estate agent and home inspector.
Making Repairs After a Home Inspection
In a best-case scenario, a home inspection confirms the good condition of a home, and buyers and sellers can quickly move forward with the final sale. But more often, the second best-case scenario involves some additional negotiation in which all parties can feel confident and satisfied in the final contract.
When it comes to making repairs after a home inspection, buyers and sellers often compromise in order to prioritize the most important repairs. Sellers may take responsibility for a handful of repairs. If this is the case, then sellers should hire reliable contractors and work with real estate agents to make repairs efficiently.
The negotiated repairs often come with a timeline in which sellers should complete repairs and then provide proof to the buyers. Another home inspection may follow to confirm that the repairs satisfy the requirements outlined by the contract. In the end, the contract that results from a home inspection should make both parties feel more confident in the homebuying process.