Posted by: Roby Robertson | March 28, 2008

Lake Norman Real Estate, Know your Real Estate Inspections

Listen Up Lake Norman and Charlotte, the Inspection Process can be confusing!


I have written before about our contracts and how agents should know these backwards and forwards so we can explain them to our clients before asking them to sign.

Recently the Charlotte Regional Realtor Association published an article about the inspection process as it pertains to Alternative 1(a). You may recall the in out contracts there are two alternatives for submitting the offer as it pertains to earnest monies and inspections. I will write about Alternative B on a later post.

The following are basic guidelines and helpful suggestions your agent may follow on when and how to handle the inspection process f you are using NCAR’s Offer to Purchase and Contract, ALTERNATIVE 1(a)
 

When can inspections be performed?

The seller can get an inspection prior to listing the property. This way the seller is aware of any major problems before setting the listing price. Depending on how this is handled, the buyer may decide not to have a separate inspection. If the seller declines to have the inspection performed prior to listing, his/her agent should take the time to go over paragraph 13 in the “Offer to Purchase and Contract,” and explain repair negotiations and the buyer’s and seller’s rights and options regarding inspection results.
The buyer can get an inspection prior to making an offer, but runs the risk that someone else will put the home under contract while the inspection is scheduled and performed.
If the inspections are being performed after the contract has been negotiated, you’re your agent should schedule inspections as soon as possible to allow time for repairs to be agreed upon and performed.

All items in Paragraph 13, Alternative 1(a) will be inspected except:
• Systems outside the home’s foundation wall.
• Friable asbestos.
• Environmental contamination.
• Detached structures, such as garages or storage buildings.
• Operation of air conditioning systems if it might cause damage (such as when temperatures are under 60 degrees).
Make sure you’re Realtor®, makes specific arrangements if the buyer wants any of these items inspected. Inspectors are required to inspect many things affecting the home that are not included in paragraph 13.

Therefore, the inspection report will contain comments on these items even though they are not part of paragraph 12, ALTERNATIVE 1(a).
Here are some examples:
• Areaways, vegetation, driveway, patios, walkways.
• Retaining walls, with respect to their effect on the building.
• Interior fuel storage, sumps, verifying a heat source in each room.
• Counters, cabinets, garage door openers, skylights.
• Insulation, vapor retarders.

Does the “Offer to Purchase and Contract” cover all my inspection needs?


NO. In most cases there are other systems or components that are not specifically addressed in the “Offer to Purchase and Contract” or “NC Licensed Home Inspector Standards of Practice,” which may affect the buyer’s concerns about the property. These can be addressed using an addendum with the home inspection company, or by making inspection arrangements with a company that specializes in that area. These include:
Water softeners or filters, irrigation systems,Low voltage electrical systems, Security systems, heat or carbon monoxide detectors, Telephone equipment, TV equipment, intercom systems, speakers systems, built-in vacuum systems, garage remote controls, Humidifiers, air cleaners, wall or window air conditioners, interiors of chimney flues, fireplace insert flue connections, Wallpaper, paint, draperies, blinds, carpeting, Clocks, timers, self-cleaning over functions, over thermostats, refrigerators (whether built-in or not), any kitchen appliance which is not built in.

If you are using ALTERNATIVE 2(a), it provides every single part of the house and property is open to repair requests and negotiation during the inspection period. Your agent may want to make a list or “Menu of Inspection Services” to review.
 

Suggestions of how inspection repairs are handled.
Lake Norman Home Inspection Checklist

When the written report is completed and delivered to the buyer, his/her agent should review the document and discuss what items to address or repair.  Make sure your agents makes you aware of what items are eligible under paragraph 13 of the Offer To Purchase Alternative 1(a). Too many times buyers assume that the entire list should be addressed.  However, this may not be the case and the buyer’s willingness to accept a few minor items may be helpful in getting the seller to address the more significant issues.  Buyers who ask for everything may be perceived as overly demanding.  Your agent should guide you through these negotiations. Your agent will then fill out a NCAR Repair Agreement Form and mark the item’s the buyer wants addressed and has the buyer sign.  This is promptly sent to the listing agent. The sellers will initial the items they are willing to repair.  This can all be negotiated verbally, however must be in writing once the agreement is reached.

Note:  Obtain receipts from individuals who performed the repairs for the seller. If the seller performed the repairs themselves or used unlicensed contractors, you may want to consider scheduling a re-inspection with the original home inspector, to verify that proper repairs have been made.

 Contact your Lake Norman Agent at 704 451 7051 for additional information on the process.

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