Dear Monty column: Do we need another inspection if the home we want was preinspected?

Richard Montgomery More Content Now USA TODAY NETWORK
Richard Montgomery

Columns share an author's personal perspective.

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Reader Question: We looked at an open house a couple of days ago. A completed home inspection concluded there were no defects or material adverse facts in the house. It also contained a list of items that required attention that were common maintenance issues. The seller had repaired or had a contractor inspect all the items on the inspection list. This company helps sellers market their homes and pays for the inspection. Their inspectors are inspecting for the company, not the seller or the buyer. If we go ahead on this home, I am leary about accepting the inspection because I didn't hire the inspector. I want the inspector working for me to make sure the seller is not hiding something big. Do we need another inspection?

Monty's Answer: This company is accepting the inspector's risk. It frees the company to properly present what the law requires of an inspector, which is to identify defects and material adverse facts. It also frees the home inspector from liability concerns or upsetting a customer. They can perform the inspection and present the findings in a positive atmosphere because they are not taking sides. This atmosphere occurs because the inspection takes place before a buyer appears. They can focus on discovering defects. Full Disclosure: I only know of one such company in existence, and I have a financial interest in it.

Seventy percent of home buyers have experienced homeownership. They know home components wear out. Home inspectors' primary reason for existence is that the buyer wants some assurance that the seller is not hiding or unaware of some hidden defect. To learn more about home inspections, here is the fascinating history of the home inspection industry (https://bit.ly/2Q6tIro).

The prelisting home inspection

Pros:

  1. Discover defects and material adverse facts and correct or disclose them before negotiating a price.
  2. The buyer and seller will not endure an after-the-fact home inspection discovering an issue that could have been found earlier.
  3. The buyer will learn before they make an offer the home's condition and whether or not any defects or adverse material facts exist. They are relieved of the stress of investing in an appraisal, a lender application fee and time waiting to learn what an inspector may uncover.
  4. Buyers are also more comfortable proceeding when they understand the actual condition of the home.
  5. The seller will learn the home's actual condition before setting a price and have it repaired before the house goes on the market. They, too, will not be anxiously waiting to see what the buyers' inspector discovered.
  6. In addition to defects and adverse material facts, home inspectors call out typical home maintenance items that, if not serviced, could become expensive to repair or replace. This information gives the seller time to deal with issues that do not rise to the definition of a defect. Taking care of such items before a buyer appears is very different from the time pressure of arranging for a contractor ten 10 before closing.
  7. If an inspector missed an observable defect, the buyer seeks relief from a company dedicated to exceptional customer service, rather than an individual inspector.

Cons:

There are no known cons to a prelisting inspection with this company. It is unlikely the second inspector will discover additional defects. Here are some helpful tips from Dear Monty (http://bit.ly/K0T5Rz) should you seek a second opinion.

Richard Montgomery is the author of "House Money - An Insider’s Secrets to Saving Thousands When You Buy or Sell a Home." He advocates industry reform and offers readers unbiased real estate advice. Follow him on Twitter at @dearmonty, or at DearMonty.com.