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Caveat Emptor: "let the buyer beware." - A Home Inspection Is Recommended

DO YOU HAVE A HOME INSPECTOR LOOKING INTO YOUR NEW HOME?

One of the major terms in most California purchase agreements is a home inspection by the buyer. This inspection is recommended to make sure the buyer is fully aware of the condition of the property they are buying.

Caveat Emptor = "let the buyer beware." (Latin)

The buyer should examine the goods and/or property and buy it at his own risk, except for latent defects. In California we practice "Full Disclosure". The seller and the agents need to disclose any material defects or material facts know or discovered during a transaction. Seller's who hide know defects from a buyer can be subject to legal suites.

The home looks perfect! You are all set to buy it and fulfill your dream. Don't let this dream turn into a nightmare because you did not get a home inspection. Agents should recommend you get a home inspection on your home purchase. In the California Association of REALTORS purchase agreement, it usually has the provision to have a whole house inspection performed by a professional.

According to a study conducted by the American Society of Home Inspectors and the National Association of REALTORS® in 2001, 77% of all home buyers insisted on a home inspection prior to purchasing their property, and 97% of that group believes the service was a good value for the price.

A home inspection is the second major contingency after the financial contingency, before you decide to purchase your home. This is where you have the right to back out of the deal, if the report indicates serious problems.

It is recommended that you checkout the reputation of the Home Inspector and to see if they have E&O Insurance. You also need to check on warranty of their inspection and if it is transferable or not. If you are a buyer and get an existing home inspection report from another buyer who did not go through with the deal, you need to check if the warranty and inspection is transferable or not. In most cases, it is not transferable.

Protect yourself!

Ask your agent for guidance and help!

Posted by Ernie Cabrera, CEO, REAL ESTATE AMERICA - REA on 11/22/2007 02:16 AM

Comments (11)

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11 Comments on Caveat Emptor: "let the buyer beware." - A Home Inspection Is Recommended

NOV

2007

Hi Ernie, I agree all buyers should have an inspection.

I lived in California for 40 years and then moved to Virginia... Virginia is a true Caveat Emptor State and Buyers need to be aware of this

Dollar for dollar, a home inspection is probably the least expensive insurance you can buy to discover any issues with a property; new or existing construction. While the market was at its peak here, everyone that could swing a hammer was a builder... or so they thought. Inspections saved buyers tens of thousands of dollars in down-the-road repairs. Definitely something not to forgo.

Have a great Thanksgiving, Ernie.

Kay, thank you for comments, it is much appreciated and respected.

Charles, I agree and I tell my buyers to get it done because it protects them from making a mistake from just letting their emotions take over. Do they practice "full disclosure" there?

Jesse & Kathy, you are right that dollar for dollar it is the best insurance they can buy. A home inspection has helped my buyers from making big mistakes. I would rather keep looking for a home for my buyer then to just have them settle for a home that is not up to par.

HAPPY THANKSGIVING TO EVERYONE READING AND COMMENTING HERE TODAY!

NOV

2007

This is very interesting to know. My wife and I are going to buy in the next few months and this is something I do more research on. How much is the cost of an home inspector?

NOV

2007

Randal, where are you from? I believe you should get a home inspection for what ever home you buy. The cost for a home inspection in Northern California ranges from $250-500, it depends what their background and experience is and what services they provide. It is very cheap insurance to make sure you know what you are buying.

DEC

2007

Also very important to make sure that you (the buyer) pay for the inspection and do not use a previous buyer's inspection. That way if an issue arises after the close you can have some recourse with the inspector.

Case in point: When my husband and I bought our home 8 years ago, the sellers had just cancelled escrow and in our haste to close and desire to save money, we used the physical inspection report from the previous buyers. Less than a year later when sewage backed up into our master bath, we found out that our master bathroom used a sump pump and it hadn't been installed correctly. To make matters worse, the pump wasn't covered in our warranty because it was outside of the home.

The existence of the sump pump was not disclosed to us on the TDS and while the physical inspection should have noted this, we had no recourse against the company for the omission since we were not their customer. It cost us several thousand dollars to have the pump dug out and reinstalled correctly.

The sellers were ultimately at fault for not disclosing it, but getting our own physical inspection would have been the first step in possibly preventing the surprise or allowing us to be compensated if we had been the customer of the inspecting company and they had omitted it in their report.

DEC

2007

Lisa, great point! It is correct that in most cases, depending on the home inspector warranty, they only cover the original buyer who initiated the inspection and is not transferable. I am sorry to hear that you went through that kind of situation. I hope that never happens to you again. I will note that on the main blog for people to know this. I would also recommend that they make sure that the inspector has E&O insurance.

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