What is a Home Inspection?

When you buy a house, it's critical to know that the structure itself is sound. A home inspection is a thorough examination of a property's structural and mechanical systems from foundation to roof. See our Home Inspection checklist [1].

It includes careful checkups of the basement, attic, walls, ceilings, doors, interior plumbing, heating, cooling and electrical systems. The work is done by an independent, state-licensed building contractor, who also looks for fire, health and safety hazards.

Some lenders require a home inspection before they will approve a loan. Buyers should demand an inspection - even if the property is new. Sellers, who want to repair any defects that could delay the sale may order a home inspection before they put their property on the market.

A home inspection is ordered after a purchase agreement has been signed and an escrow account has been opened.

If the inspector, who files a general report with the escrow or closing agent, finds a defect in a particular system, a specialist, such as a professional roofer, plumber or electrician will need to be called to make the repairs.

How much does it cost?

The cost of an initial home inspection depends on the size and location of the property. General inspections range from $300 to $500.

Who pays?

The buyer pays for the home inspection as part of the total closing costs, unless a different arrangement has been made between parties before the purchase agreement has been signed.

Smart Tips

• Shop around. Interview at least three inspectors. Get more than one estimate. Check references. Walk through the property with the inspector. The least expensive quote may not yield the best service.
• Make sure that the inspector or contractor is an independent third party who is trained and certified to conduct home inspections in the state where the property is located. Find out if the inspector you want to hire is a member in good standing with the National Institute of Building Inspectors.
• Be sure the utilities have not been turned off before the inspection, so you don't have to reschedule.
• If you are selling your property and order an inspection before you place the property on the market, make sure that the inspection has been within the last six months.
• If you are buying a property, be sure to include a contingency clause in the purchase agreement that makes it possible for you to withdraw from or renegotiate the sale if severe structural damage is discovered.
• It's also important to take a final walk through of the property to make sure that all outstanding repairs are completed to your satisfaction before you sign the paperwork that closes the transaction.