*I am kind of new in the Home Inspection field,but have been in the residential and commercial construction industry for the last 25 years.I just got tired of chasing employees around and dealing with the headaches that come with having several employees.That is why I like this business.I plan to retire doing this and plan to learn all I can about it.I see that there is a fine line that we all as Inspectors have to walk.Between real estate people,home buyers(saying the wrong thing),and home owners(saying the wrong thing).And then on top of that ,I see where some inspectors are also construction contractors.Isn’t this a little over the line of looking out for your client( who is paying you)? This is just a question,and I would like to know what you folks think. Thanks JC Smith *
Many regulated states prohibit this practice & I suspect most of the HI trade organizations have a clause in their Code of Ethics something like NACHI’s:11. The NACHI member shall not perform or offer to perform, for an additional fee, any repairs or associated services to structure on which the member or member’s company has prepared a home inspection report, for a period of 12 months. This provision shall not include services to components and/or systems which are not included in the NACHI standards of practice.
Ok,let me clarify what I am talking about before I give you the wrong impression of why I am asking.In my training,they tell you that it is unethical to solicite remodeling jobs during or just after an inspection.But,they say that if you do a job for a client after a year has passed ,it is ok. Let me add ,I have no intention of getting into the residential construction market again.But I see so many listed that do that very thing.I just wanted to see what the general poulation of inspectors thinks about this practice. Thanks ,JC Smith
Good question… the NACHI code of ethics states the following:
“The NACHI member shall not perform or offer to perform, for an additional fee, any repairs or associated services to structure on which the member or member’s company has prepared a home inspection report, for a period of 12 months. This provision shall not include services to components and/or systems which are not included in the NACHI standards of practice.”
If you inpsect it, then don’t work on it.
I come from the same background that you do and understand your position.
As long as your inspection does not have a connected relationship with the work you do, then your OK… but there is a possible catch…
If you paint someones boat house and later get accused of taking the job as a favor for some of the things said, or not said on their home inspection report… it could be used against you. This is a stretch… but it could happen.
So be wise and do no evil.
The Texas Occupational Code states:
*§ 1102.304. REPAIRS AND MAINTENANCE. An inspector may *
*not perform or agree to perform repairs or maintenance in *
*connection with a real estate inspection under an earnest money *
contract, lease, or exchange of real property.
Added by Acts 2001, 77th Leg., ch. 1421, § 2, eff. June 1, 2003.
There is an effort underway to add “for 12 months” to this paragraph because, right now, it can be construed that this prohibition ends after the closing because the real estate transaction is then no longer under an earnest money contract. All HI’s I know take the safe route and just do not provide repair/remodel services at all around here. I’m sure there are exceptions, I just haven’t run across them yet.
Conflicts of interest when the inspector is also a contractor can run much deeper than you’ve described. I was deposed a couple of years ago regarding the following:
a) Inspector/contractor inspects a property for the buyer.
b) The report discloses multiple problems about the property.
c) Buyer decides the work needed is to substantial in cost for their plans to buy, fix and flip the property project.
d) Buyer cancels escrow.
e) Three months later, the inspector with an investor purchase the property, fix it up and resell it.
f) The original buyers agent along with the original buyer file suit against the inspector/contractor and win a settlement from the inspector and his relative investor partner.
If you work on a property as a contractor, don’t inspect it. If you’ve inspected the property before, don’t perform construction related services or repairs on it. If your client cancels the escrow based on your inspection, “Don’t Buy It!”. The negative stories and downside liability from doing so are endless…
You see,these are my thoughts excactly.I believe I would run like hell from a deal like you described.I just can’t believe that some guys would risk what they do to make more money.I have always believed that you do what you do ,and try to be the best at that.Unless you want to do something totally unrelated.Thanks for your input.JC
Since I am a “Electrical Contractor” and a " Home Inspector"…do you think it is a problem?
Is it not possible to wear (2) different hats…?
When I am doing my " Inspector" thing I do it as well as I can…and if I defer to a electrician I treat it as anyone else would even if I happen to have additional knowledge that can help them…but I would NEVER contract the electrical work to FIX the problems I find…
That is the “Conflict of Interest” part…and to be totally HONEST with you…regardless…some of the things I find I would not want to FIX anyway…lol…so it works out GREAT to be honest with you.
Just keep them separated . . .
John, my eyes are not what they used to be -
could you please leave out the italics?
How about this Russ? :mrgreen: Better?[size=2] :mrgreen: [/size]
[FONT=Comic Sans MS]Just kiddin.Yes my thoughts excactly.I feel if you do electrical work for someone who didn’t hire you for inspection services, then you have two separate business and that’s it.But I feel if you use the inspection bus. to solicite construction work,then you might be putting both business’s at risk legally. [/FONT]
But you see John…that does not happen…I wear MANY hats as do many other contractors .
But if we want to talk conflict of interest…lets talk about the RE Agents who only refer (1) HI because they know they are going to get a FLUFF report and a “Look the other way” approach…that to me is the REAL conflict of interest in the business.
I have never worked on electrical work I have found as a HI…again because for (1) I dont need the work and (2) I have always been well aware of the conflict of interest…same as doing a Radon Inspection and not doing the Radon Mitigation…all the same thing…
I think everyone is aware of the issues with this…
My point excactly.I agree with you.I just wanted to see how many HI’S do.
Why isn’t there any regulations regarding being an Inspector and a Realtor?
I would think their is…same conflict of interest possibly…but WAIT…are you saying…inspect a HOUSE on Monday and Sell another on Tuesday…hmmmm
I dont have a problem with that personally…:)…as long as the home they are inspecting did not ORGINATE from their same firm…
Ahh…but think about it…we get too dirty and nasty for a slick talking RE Agent to venture under a house…thehehe…so that pretty much keeps it in check on its own…pansies
So don’t wear Levis on Monday and a Pierre Cardin on Tuesday?..
I’m going to…
lol…YOU in a Piere Cardin…now I KNOW the WORLD is coming to an end…The Sky is falling…the SKY is falling…
In Texas there is and I bet there is in Az as well. This pertains to inspecting/selling the same house. A person can be an inspector on one house and a Realtor on another however, just not both at the same time on the same house.*§ 1102.303. ACTING IN CONFLICTING CAPACITIES. An *
*inspector may not act in a transaction in the dual capacity of *
(1) undisclosed principal; or *
(2) broker or salesperson. *
Added by Acts 2001, 77th Leg., ch. 1421, § 2, eff. June 1, 2003.
Mike, I’m sure there is a law regarding inspecting the same home you sell…law of common sense would supersede, but I’m sure there are still a few doing it somewhere in the country.
I saw a message somewhere else a while back, the realtor had it on his sign…one stop shopping.
I don’t remember what state it was, but they must of been a little back-woods I’d have to say.
lol…yeah I think that sign is all over the place in Arizona…thehehehe