I’m sure this has been discussed before but I can’t find any old threads.
I just got a call from a broker that asked if I can meet with his client looking to buy the home that I just performed a pre-listing inspection on last week. Ie., consult the prospective buyer, for a fee, at the property of the pre-listing inspection report that the seller paid for. He claims his inspector performs this service. I recall getting this question a few years ago when I was new from another broker in this area and didn’t have an answer for them. I haven’t been asked since.
Has anyone had this requested of them in areas where pre-listings are the majority of inspections and have you performed these consultations? I think the Broker is trying to get a cheap inspection for his client. Is this even ethical or allowed? I’m not feeling it but I’m looking for some feedback, please and thank you.
What Agreement did you have with your Seller Client regarding communications with potential Buyers/Agents??
This should have been discussed and included in your Contract.
You did an inspection for the seller.
Seller is now asking you do discuss the report with a prospective buyer?
You don’t have to create a new report, just talk to the buyer about the report?
So if this buyer falls through, you can do the same thing for the next one? I.e. 1 report turns into a revenue stream that requires no more work except a conversation?
That part is covered, I use the NACHI PIA. I have no problem answering a couple questions on a phone call with written permission from my client. That only takes 5-10 minutes on average.
To drive 20 minutes to meet a non-client to consult on a home inspection report for 30-60 minutes is not something I’ve thought about doing or worked up a consult fee on. Time is money but is there anything wrong with charging for this service? So if I just say I’ll do it for $250, I’m not violating any code of ethics or any other professional standards? Do I need some form of agreement with this prospective buyer or is that covered in the original PIA? IDK what IDK, hence the post.
Your understanding is correct except I doubt the seller knows yet. Its the prospective buyer’s agent. If I do this, I’ll have to contact the seller to get written permission.
IDK, but I ain’t doin’ it for free. I’ll answer a couple questions on the phone but I ain’t spending two hours of my precious time and gas without getting compensated for it.
Anything you discuss with a un-named (random) person falls outside of any contract you may have with that person, but sets you up for additional issues.
Check your state’s rules, if you practice in a regulated state. In Indiana, you would have to get permission from the sellers that you would be receiving compensation from more than one party for the inspection.
Since I know you do many pre-listing inspections, maybe you want to come up with a form for your clients where they can sign off, or not sign off, on you discussing their report with potential buyers. This would be a blanket form that would apply to all potential buyers who contact you for questions about your client’s report. I would add it as a separate agreement along with their inspection agreement in the dashboard. Either they sign off on it, or they refuse it.
After that, I would develop a fee schedule based on what the potential buyer (new client) wants.
20 minute phone review - $xx.xx
Onsite Property walkthrough - $xxx.xx
etc, etc, etc.
Then, make up a simple agreement, similar to a consultation agreement, that you can have the buyer clients sign off on.
An inspection report is a time stamped related snap shot, of the day of the home inspection. Anything can happen to that residence after that day/time you left the residence in question.
Lets say you missed something, or if the next purchaser relies on your time stamped home inspection report and the agreed to consolations for a free therein after, ‘as the broker wishes you to do’. I would dare to say, you exposed yourself to superfluous/redundant/excess liability exposure, and you insurer will likely balk at. In other words; your (E&O) insurance company might hesitate or be unwilling to cover, and that smudge stain is recorded for prosperity, not yours by the way.
Do you use the InterNACHI Home Inspection Agreement? Read article (3) if you do.
3. The inspection and report are for the use ofCLIENT only, who gives INSPECTOR (You) permission to discuss observations with real estate agents, owners, repairpersons, and other interested parties.
INSPECTOR (You) shall be the sole owner of the report and all rights to it.
INSPECTOR (You) accepts no responsibility for use or misinterpretation by third parties, and third parties who rely on it in any way do so at their own risk and release INSPECTOR (You) (including
employees and business entities) from any liability whatsoever. Any third parties who rely on the report in any way also agree to all provisions in this Agreement.
INSPECTOR’S (You/r) inspection of the property and the report are in no way a guarantee or warranty, express or implied, regarding the future use, operability, habitability or suitability of the home/building or its components. All warranties, express or implied, including warranties of merchantability and fitness for a particular purpose, are expressly excluded to the fullest extent allowed by law…
I’m curious to hear what the common practices are for people who do a lot of prelisting/seller inspections. For us it is rare and most often done to help pin down what should be fixed prior to listing. It seems the report is rarely shared with prospective buyers. Given that things have usually changed between the inspection and a buyer looking at the home or report I’d be very reluctant to talk about much of anything with them.
