It might shock you to know that 95% of new homeowners discover issues with their homes after they’ve closed the deal. That’s why a home inspection before buying is so important. While they aren’t mandatory for your home, they can save you a lot of problems down the line. This is especially true if you want to sell your home.

But knowing what should be done after an inspection isn’t always clear. Understanding what’s a legal requirement and what isn’t is confusing. Knowing the right path to take after a home inspection will increase the value of your home and save you money in the long run.

One way or another, if you’re thinking about selling you should have a home inspection. If you’d like to learn more about what fixes are mandatory after a home inspection, keep reading.

What Areas of the Home Do Home Inspections Cover? 

Before knowing what happens after a home inspection, you should be aware of what an inspector will look for during one. A dedicated home inspector should look at every area of your home. This includes interior and exterior parts.

Inside your house, your home inspector will start with the floors, walls, and ceilings. They will search for cracks, loose flooring, dampness, and even mold. This is to make sure the structure of your house is secure. 

Along with this, a home inspector will check your heating and ventilation systems. These systems are important parts of your home not only for comfort. They have the potential to cause safety hazards if they are not properly maintained. That’s why your home inspector must look at them carefully. 

Outside, your home inspector will want to look at your roof. However, they will only go on to it if it is safe to do so. They may ask to return at a safer time with proper equipment to inspect it if they think this is necessary. 

A home inspector will assess Your doors and windows both inside and outside your home. Your inspector will want to make sure these home components can function safely and open and close without difficulty. Your doorframes will also be inspected to ensure they are secure. 

Overall, most home inspections only take between 2-4 hours. However, they may take longer if you have a particularly large or old house. It is a good idea to have someone who knows your home will be present during the inspection if you cannot be. 

Your inspector doesn’t want you to worry, and they don’t want to get you in any trouble. They simply want to make sure your home is as safe as possible before selling. 

What Are the Most Common Home Inspection Repairs?

One of the most common repairs a buyer will request are fixes to the house foundation. This is an important repair, as foundation issues are not always easy to spot until they have become a serious problem. If a home inspector finds foundation problems, you should repair them quickly. 

Another common issue that often appears during home inspections is HVAC problems. Buyers will not want to move into a home that has issues in these areas, especially because HVAC problems can be harmful to health. A seller should repair these problems if they are found during a home inspection. 

Electrical faults, such as damaged wiring, are also commonly found during home inspections. This is particularly true of older houses. Old buildings may not have had their electrical systems updated for a long time.

Issues that are considered dangerous are the most commonly requested repairs. While the interior and exterior cosmetic issues will be noted, a buyer is more likely to want their safety concerns alleviated before purchasing your home. 

One non-safety repair that may reveal itself during a home inspection is plumbing issues. If your home experiences blocked pipes frequently your inspector will make note of this. This is not a problem new buyers want to deal with, and so it is in your best interest to make this repair before trying to sell your home. 

How Do I Read My Home Inspection Report?

A home inspection report might seem complicated. There is often a lot of detail to get through to figure out what needs the most attention in your home. But reading through it is important.

The first part of the report you should focus on is the summary. This will provide you with an overview of the most pressing issues in your home. You’ll find any potential health and safety concerns outlined here. These are usually also discussed in more detail throughout the report. 

After you’ve read through the summary, you should focus on where the inspector has determined your most expensive repairs are. These are usually issues like repairing roof damage or replacing door and window frames. These are the areas you can expect a buyer to want you to repair, and so you should use the report to calculate what this may cost you. 

Finally, you should make note of any cosmetic repair recommendations or less expensive repairs. While these are important, your buyer may be happy to repair these parts themselves. Your estate agent will offer you advice on what less significant repairs you should consider making to add value to your home. 

Who Does the Cost of the Repairs Fall On?

This will depend on the kind of repairs needed for your home. Most of the time, the cost of repairs will fall to the current owner of the house. Based on your home inspection maintenance report, these repairs could be safety concerns or cosmetic issues.

However, as a seller, you don’t want to spend too much money fixing up your house before purchasing. This decreases the amount of profit you make. It is common for buyers and sellers to negotiate repairs with the help of a real estate agent. It is common for buyers and sellers to negotiate repairs with the help of a real estate agent. 

Buyers will usually request that all safety repairs are paid for by the seller. This includes mold, faulty electrical wiring, and certain HVAC issues. If the seller agrees to this, they may ask that the buyer pays for any cosmetic issues themselves. These include lifting carpets, changing wallpaper, and even swapping out door and window frames. 

Do I Need to Let My Real Estate Agent Know?

Yes, both the buyer and the seller should let their respective real estate agents know that a home inspection is taking place. You should also show them the finalized report after the inspection is over. 

For a seller, a real estate agent is their best asset in terms of negotiation. If a buyer makes a repair request that is too expensive, unreasonable, or even not outlined on the home inspector’s report, a real estate agent can handle this for the seller. They may advise the seller to offer the buyer a slightly lower price for the home if the requested repairs are not made.

A real estate agent will also be able to clarify what repairs are necessary. These may be repairs that are required by the buyer’s lending body or repairs that the state has outlined as necessary. On other occasions, they may simply be repairs that the seller should agree to out of a duty of care for the new homeowner. 

Do I Have to Make the Repairs Outlined by the Inspector?

Some state laws require certain repairs outlined on a home inspection to be made. Generally, these are safety issues that risk damage to the structure of the house.

If a buyer is getting financing for their new home, then the repairs outlined in the inspector report may be required. Again, these repairs are generally safety issues. Mortgage providers consider these repairs carefully. If they are not taken care of before a sale is agreed upon, the buyer may have to spend more money than they can afford to make these repairs. 

The kinds of mandatory fixes after a home inspection exist to keep new buyers safe in their new house. It also reduces the chance of any legal issues following a sale agreement, as any problems within the home itself will have already been discovered. 

What Fixes Are Nonessential?

Some home inspection fixes are simply guidelines, and not necessarily required. These won’t be required by the company supplying the buyer with a mortgage, or by state law. 

Most nonessential repairs are aesthetic issues. For example, old carpets detract from the look of a room due to discoloring or worn fabric. While this may be off-putting for a buyer, a seller is not required to make this repair because it is not considered dangerous. 

There are other kinds of nonessential repairs. Countertops that are rotting due to damp or worn wood are not essential repairs. However, these are very off-putting for a buyer and could detract from the price of your home. 

The best way to know if repairs are essential or not is to ask both your home inspector and your real estate agent. They will be able to advise you on what you must repair, and what isn’t necessary. They’ll also let you know what you should repair to increase the value of your home. 

A home inspector won’t try to fool you. They will only report what they believe is a fault in your home that the buyer should know about. Following the advice on a home inspector’s report is the best way to know what you should offer to repair for your buyer. 

What Happens Between Buyer and Seller Following a Home Inspection?

After a home inspection is over, the buyer will be sent a copy of the report. This report will detail anything the inspector has found that they believe should be repaired. It will also contain details of potential hazards.

The buyer will discuss the report with a real estate agent. The estate agent will advise them of what repairs will need to be made to make the house safe. 

The buyer will then send requests to the seller outlining what they would like to have repaired. The seller then has several choices. They can agree to make all the requested repairs, agree to make some of them, or refuse to make any of them. 

There is usually room for negotiation between the buyer and the seller. However, as a seller, you should know that if you refuse to make any repairs it may result in the buyer backing out of the agreement. 

Once negotiations have been sorted out, closing the agreement can move forward. An appraisal will take place to know what the value of the property is. 

So, What Should Be Done After An Inspection?

The answer is up to you.

What should be done after an inspection depends on your home and what it needs. It also comes down to what the buyer wants. You should always bear in mind that if you don’t fulfill the buyer’s repair requests, they may change their mind about buying your home. 

A home inspection will not only improve your home’s appearance but also make it as safe as possible for a new buyer. That’s why you should listen to the advice of your inspector. Trust them to guide you on the right path to getting your home sold for the best price. 

The post What Do You Need To Do After a Home Inspection? appeared first on iBuyer Blog.

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Buying and selling a home are the biggest financial deals most people make in their lives. You’re working with hundreds of thousands of dollars. With such a big quantity of money, there’s bound to be a hiccup or two in the process along the way.

What do you do, though, when you think you’ve done everything perfectly, and the entire deal still falls apart? What are your next moves if a loan fell through the day before closing the deal? 

By the time you’ve finished reading this article, you will understand the reasons for closing day issues as well as what to do when your mortgage falls through. 

Why the Loan Fell Through Day Before Closing

It’s important to note that loans do not typically fall through on the closing date. If a mortgage loan is going to fall through, it will happen far before this critical date. With that said, no deal is secure until every paper is signed by all parties. 

Most often, a loan will fall through because of an issue with mortgage approval. For the buying party to put an offer on a home, they need a lender to pre-approve their loan. This is a preliminary step where the lender takes a cursory look at the loan application and puts a temporary stamp of approval on it. 

Most buyers will have the pre-approval process completed before they begin house hunting so they know how much of a house they can afford. Furthermore, most sellers require a pre-approval letter before they’ll even move forward with the negotiation process. 

Pre-approval, however, is not the same as approval. It makes approval likely but not a full-on guarantee. 

When a seller accepts the buyer’s offer, then the approval process begins. The buyer will apply for a mortgage, and the approval depends on the inspection and appraisal of the property. 

Thus, even if a buyer has had a loan pre-approved, it may not be approved in the end, and the deal will fall through. 

Here are a few common problems that could cause a home closing day problem. 

Financing Problems

If a lender pre-approves you for a loan, a seller should curb their credit-based spending for a bit. When they have a big purchase on credit between the pre-approval and approval time, a lender may choose to not approve the loan. 

The borrower will look much riskier with a big credit purchase on their record. Plus, big credit purchases and requests for more credit affect your credit score.

The same principle applies if a borrower applies for more credit after receiving pre-approval. The buyer simply looks like they’re needing more money for other purchases. This implies they may not be able to pay their mortgage regularly because they’re looking for credit in other places. 

If a buyer cannot avoid a big credit purchase, they should have cash on hand to cover the down payment that their lender won’t cover. 

A buyer could also apply for a loan with a different lender. This will take time, though. 

Appraisal Problems

Sometimes the seller will list a property for more than what it’s worth. The appraiser ultimately determines the financial value of the property. 

If a home is worth less than what a borrower wants to borrow for it, the bank will not approve a loan. 

Thus, if the appraisal comes back low, a buyer can ask the seller to lower the price of the home. However, if there are other buyers in the mix who can afford to buy the property and really want it, a buyer can offer to pay more upfront to offset the difference between the mortgage and the buying price.

It also helps to understand the markets in the region. This will assist with proper home pricing.  

Problems With a Title

Experts estimate that approximately 13% of home sales are delayed because of problems with titles. There are a variety of reasons a title may not be clean. Here are a few of the most common issues with a title: 

• Debts to contractors
• Outstanding taxes
• Bankruptcies
• Child support liens
• Not being the rightful owner

The title is the term used to indicate who legally owns the property as well as who has the legal right to use and sell the property. Thus, if multiple parties have a hold on a title, the title isn’t clean and the seller cannot sell the property. 

When a borrower attempts to borrow money, the lender will conduct a title search on the home. If the lender finds a title with issues, they will not lend money to anyone to buy the property. 

Sellers need to pay off their loans, debts, and taxes that could show up as a title defect before they list the property. 

Inspection Problems

Lenders require an official inspector to walk through and evaluate a home before they’ll approve a loan. Home inspections reveal problems that sellers may have neglected to explain to a buyer. So if a home inspection reveals a glaring problem, the lender may deny the loan approval. 

Sometimes the lender will just delay the process until the seller remedies the problem. For example, a lender may require the seller to fix a roof or a plumbing issue. Then once the seller has completed the repairs, the lender will approve the loan. 

Walkthrough Surprises

Approximately a week before a buyer and seller close on the property, the buyer will do a walkthrough of the home. If the buyer notices a problem, like a missing appliance, they can delay closing. 

To avoid this problem, the buyer and seller need to have a clear agreement on what is and what is not included in the property. The buyer and seller should also have an agree-on walkthrough checklist. 

Missing Disclosure Form

The closing disclosure form is the paperwork that outlines the buyer’s loan terms and other closing costs involved with the deal. The lender or title company will send the disclosure form to the buyer at least three days before closing and no later. This should give the buyer time to review the disclosure form. 

If the lender or title company sends the disclosure form later than three days before the closing date, then the buyer can delay the process. The buyer must have the disclosure form in their possession three days prior to the closing date. 

Paperwork Errors

Small errors in paperwork can delay closing dates. Wrong addresses, misspelled names, and extra fees thrown on the paperwork will delay the closing. Thus, a seller should preview all the paperwork carefully before the closing day to check for these small errors. 

Cold Feet

Sometimes a buyer or a seller will get cold feet. They may have remorse because the home is either very expensive or they have a sentimental feeling about the property. 

It’s natural for a buyer or seller to feel a little apprehension at the closing date. After all, this is one of the biggest financial deals they’ll ever make. 

What To Do When If the Mortgage Fell Through on Closing Day

Ultimately, no buyer or seller can control the financial behavior of the other party. So if your buyer decides to take out a massive boat loan after they’ve begun the buying process on a home, the seller can’t fix that problem. 

There are a few things both buyers and sellers can do, though, if the mortgage falls through on the closing day. 

Only Work With Pre-Approved Customers

First, a seller should only work with someone who has a pre-approved loan. This pre-approval indicates the buyer’s financial health and responsibility, and it increases the likelihood that this deal will go through. 

Take Earnest Money

If you’re nervous about losing money on a sale, don’t be afraid to require earnest money. You can even choose to raise earnest money. Earnest money is the amount of money a buyer must pay the seller ahead of time. 

This is a non-refundable deposit to the buyer. It guarantees the buyer receives something even if the deal falls through. 

Double Check Your Interests

If you’re hesitant about selling your home, don’t list it. Make sure you truly want to move before your list your home, and make sure you have a place to stay should your home sell quickly. 

A local real estate agent will understand your local market and have a clear recommendation on what to list your home for and how long you should expect it to be on the market. So prepare yourself for these two things before you list the home. 

Once you sign a purchase agreement, legally, you cannot back out of the closing. 

If the mortgage falls through, you can find yourself a new buyer, wait for your current buyer to come back with a different offer, or sell the home to a buyer who will pay you cash for it. 

Stay Calm, Have a Plan

You won’t quickly forget when your buyer’s home loan fell through the day before closing. However, you can have a plan in case this does happen. 

First, prevent such a happening by having all of your paperwork in order and by having a clear title. Then, work with your realtor to find the most secure buyer. 

Then you’ll have the memory of shaking the new buyer’s hand on closing day and finishing up one of the biggest deals you’ll make in your lifetime. 

Do you need to sell your home? If so, get started here. Take time to learn more about us and how our solutions work.

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