By Keith Boggs
Posted November 18, 2019 at 10:00am CST
As a prospective home buyer, you know that no home is going to be perfect. A home inspector will uncover defects, regardless of how well the property looks on the surface. So, what happens after you find out what those defects are? What must be fixed before you can close, if anything? This is an important question because late surprises can completely derail a deal.
Here are some details to help you understand the process, so you can keep things moving forward as smoothly as possible.
The Home Inspection Report Provides Valuable Insight
Once the seller has accepted your initial offer, you’ll hire a home inspector. The home inspector represents you, as the buyer. Their job is to make sure you have a clear picture of the condition of the property before you agree to purchase it. They’ll conduct an inspection and provide you with a report as required (in Texas) by the Texas Real Estate Commission (TREC).
At a minimum, your home inspection report will identify and report on defects as required by TREC. If you’ve hired a top-notch home inspector, it will also contain a broader perspective of the property’s condition — the condition of components and systems that TREC deems as optional for inspection, observations about the general condition of the property as a whole, and thoughts on repair approaches.
But just because something is mentioned in the inspection report doesn’t mean it has to be addressed before you can move forward with the purchase. As a buyer, you should review the report thoroughly, ask your inspector questions for clarification or additional recommendations, and then ask yourself a few questions:
- What issues do you want the seller to address before you close?
- If they don’t want to address them, how might you amend your offer?
- What issues will you ignore for now and likely address later on your own?
- Are there any deal-breakers in the report that could make you walk away?
At this point, you may request that the seller fix some things, accept others as they are, and/or negotiate for price concessions or a home warranty. If you come to a final agreement on how issues in the inspection report will be addressed, you’re ready to move to the next step — but you still may not know all the fixes that might be required before you can complete your purchase.
Mortgage Lenders Have Their Own Requirements
Assuming you’re using a loan to make your home purchase, your mortgage lender may mandate that certain issues be addressed before the deal can close. They will hire an appraiser to assess the property’s condition and determine its market value. The appraisal report gives them guidance to request the fixes that must be completed to meet their minimum property standards.
In general, most lenders are concerned with repairs needed to address health, safety, and security issues, as well as the structural soundness of the property. For example, they will often require defects, such as costly structural issues, building code violations, or safety hazards in areas like attics, chimneys, or furnaces, be repaired before closing. They won’t usually be concerned about less serious defects or cosmetic issues.
When an FHA (Federal Housing Administration) loan is involved (versus a conventional loan, which is not government-insured), however, there are stricter requirements. Appraisers are required to do a more detailed property inspection that meets the Department of Housing and Urban Development’s (HUD’s) minimum standards for health and safety. Here are a few of the conditions that may need to be repaired before closing:
- Peeling paint in homes built before 1978, which might be a lead hazard
- Unpainted downspouts and broken rain gutters
- Exterior doors that don’t properly open and close
- Exposed wiring and uncovered junction boxes
- Major plumbing issues and leaks
- Inoperable HVAC systems
- Leaky or defective roofs or those with a life expectancy of fewer than three years
- Active and visible pest infestation
- Rotting windowsills, eaves, or support columns on a porch
- Missing appliances that are usually sold with a home, such as a stove
- Bedrooms without minimal-sized windows for egress or windows with bars that don’t release
- Foundation or structural defects
- Inoperable kitchen appliances
You can find more information on HUD’s FHA guidelines on their website.
So, What Fixes Are Mandatory After a Home Inspection?
The answer is — it depends! Once you understand the basics, you can talk with your mortgage lender to understand their minimum property standards and then — to make sure your post-inspection process goes as smoothly as possible — make sure your home inspector is aware of the lender’s requirements, so he can focus on those areas during the inspection and make sure they are addressed in his inspection report.
Image Credit: stevepb via pixabay
About Keith Boggs
Keith Boggs is the owner of Stonebriar Property Inspections. He is your personal home inspector, and his investment in the company will be reflected in the quality of your inspection. Mr. Boggs’ inspection reports are professional, comprehensive, detailed, and clear. They average about 70 pages and include 80 to 100 color images and include detail findings and recommendations along with tips and best practices for maintaining your home. Stonebriar Property Inspection’s customer reviews speak to Keith’s reputation as an ethical, reliable, and courteous Dallas home inspector. Stonebriar Property Inspections is a proud member of the Better Business Bureau with an A+ rating. SPI is fully licensed by the Texas Real Estate Commission for home inspections and the Texas Department of Agriculture for termite/wood destroying insect inspections.