Whoa! Our Home Inspector Mistake
Skipping Over a Buyer's Home Inspection

Meg and Jim were buying a house and didn't hire a home inspector. They decided to cut corners on a buyer's home inspection in order to save money.

I'm sure you've felt this way before too. But unless you can imagine spending your weekends in home repair, a few hundred dollars for an inspection could be the best decision you make. In the following article, you will discover how "prevention is better than cure" as the classical scholar Erasmus advised.

Hire A Licensed Home Inspector - Avoid This Big Mistake When Buying A House

Do you know why buyer's home inspection and buying a house go hand in hand? Just the other day I overheard this story.

They did not heed the advice of their Realtor to hire a certified home inspector.

They thought they could save a few hundred dollars normally charged by a home inspector. Money was scarce to begin with. So it was a natural reaction to request that her dad take the place of a licensed home inspector.

After all thirty years of climbing ladders had taught him most everything about houses.

For the sake of privacy, let's refer to the home buyers as Meg and Jim. As I was saying, Jim and Meg recently bought a house and thought they could save some money by asking Meg's dad to look the house over before they closed on the purchase of their new home.

Meg's dad worked in construction all his life. He knew all anyone needs to know about houses, Meg and Jim assumed. He would certainly be able to spot any trouble spots.

So before giving his opinion that the house was in great shape, her father completed his inspection. He had inspected a pretty sturdy house, Jim's father-in-law reported.

But her Dad's lack of objectivity cost them. Sure, Jim and Meg saved the price of hiring a professional home inspector but it was insignificant compared to what followed, repairing the electrical panel and replacing electrical wiring.

Here is a mistake first time home buyers often make.

The terminology is strange and they skip over the importance of home inspection.

A lot of people wonder if they pay for an appraisal why would they also need to hire a home inspector. The answer is simple really.

According to Barron's Dictionary Of Real Estate Terms a house appraisal is an estimate or opinion of the value of a property. Appraisers can use 3 methods to estimate the value of real estate, the cost approach, the income approach, and the market comparison approach.

When buying a house for your personal residence, an appraiser normally uses a market comparison by comparing the subject house with other homes in the area.

In other words, a licensed real estate appraiser determines if the price you are paying for your new home falls with the market value of other homes in the area. The real estate appraisal does not normally look in depth at plumbing, heating or electrical systems for example.

In contrast, the job of a home inspector is to zero in on safety and soundness aspects of your new home. A buyer's home inspection will determine if the structure, construction, and mechanical systems are safe as well as working correctly. In addition, your professional home inspector will point out immediate and future repairs with the associated estimate of cost.

Here is where real estate agents can help a lot.

Take advantage of their expertise. They have been trained how to write an offer in good faith that protects you if it turns out the home needs repairs.

When you find a house you are serious about buying, request that your real estate agent show you how to write up the offer subject to inspection. That way there is an acceptable exit if a home inspector unveils any major problems.

You can also ask your real estate agent how to accommodate a price adjustment if necessary. An inspection clause in your offer can also specify that the seller fix any repairs before close.

Don't end up like Jim and Meg. Because Dad wasn't equipped to properly inspect the house and wasn't systematic in his approach, he missed a problem with the electrical panel which they eventually had to replace. They saved on the inspection but paid more than $2,000 for a new electrical panel and updated wiring.

If you enjoyed this article about the home inspector report, you will also like Ten Home Buyer Questions To Avoid Buying A Money Pit.

Prime Real Estate Articles Tip No.33
Home Mortgage Application | Property Appraisal

Why should you ask for an appraisal as soon as possible when refinancing or buying a house? Because delaying an appraisal creates uncertainty.

Without an appraised value, you do not know how much you can borrow. That means how much cash you may need is up in the air.

Calculating mortgage loan amounts is like putting a puzzle together.

The first three pieces are income, debt and credit history. The fourth piece is how much you owe on the current mortgage for refinance or the amount of downpayment you've saved for buying a house.

But even still, there is a fifth piece to the puzzle, the appraised value.

Your qualifications may have been initially calculated but without an approved appraisal, no final loan amount can be calculated. And that means uncertainty.

So don't delay the property appraisal. Ask for it to be completed as soon as possible. Finish the puzzle and put your mind at ease!

Understanding Mortgage Applications

Take the guided tour with Kate's unique tips for filling out your home mortgage application...

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