Lately, I have written about some of the changes that are occurring in this state as we prepare for home inspector licensing that will come roaring down the pike in September. From Bellingham to Spokane, inspectors and real estate professionals need to be aware of these changes.
An earlier post described the new section of a WAC that took effect at the end of January. It mandates that real estate brokers must establish a policy to assure that agents disclose to clients any "business relationships" they might have with the home inspectors they refer. The department of licensing, administering the rules, has stated in writing that a realtor, referring an inspector based on merit, is not a business relationship requiring disclosure. You can read the detailed information here.
For the record, the proposed home inspector Standards of Practice and Ethics mirror this sentiment. They say:
"The inspector shall provide full written disclosure of any business or familial relationships or other conflicts of interest between themselves and any other party to the transaction. The parties may include, but are not limited to, buyers, sellers, appraisers, real estate licensees, mortgage representatives, title companies, vendors and service contractors."
For the most part, this is self-explanatory. The home inspector licensing board discussed this language. A few explanations, based on our conversations, follow. This rule applies to situations where the inspector might have a wife, a sister, a brother, a child who is the seller, a realtor, a mortgage broker or anyone else who might be involved in the deal.
Then there is the word vendor. Some inspectors have asked what is meant by the requirement to disclose conflicts of interest that might exist with vendors. That is not complicated. Inspectors must disclose certain business situations that are not readily apparent to the client. For example, let us say the inspector or a family member has an interest in a plumbing firm and that firm's name was given to a client as the "go-to" guys to solve a plumbing issue. Or assume another scenario: Maybe an inspector is paid a "finder's fee", a kickback, for sending clients to a certain roofer, electrician, HVAC company, alarm company, etc. Any such relationships must be disclosed to the client, as specified in the SOP and ethics.
For specific information, you should contact the Department of Licensing.
To see additional information on home inspector licensing in the state, click on George's head.
Steven L. Smith
Bellingham WA Home Inspections
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I suppose it can all get confusing, anything that's new tends to be that way. We just follow a few simple rules. If I inspected it I won't consider working on it. If my wife or son inspected it, I won't consider working on it. If they inspected it, they won't refer me to do any of the work. Keeps it all simple and ethical.