Inspection Industry

It is so exhilarating for me to enlist new members, and the impactful way InterNACHI aids in the new direction of one man or woman’s career; especially those coming from shift work in the steel mill, or the single mom looking for a new path. Real Estate isn’t going anywhere and 30+ years ago, home inspections were unheard of. However, in today’s society, mortgage lenders won’t hear of loaning without an inspection.

Our industry is not dictated by Corporate America in that, mergers and acquisitions will affect your job title. InterNACHI has over 30K members worldwide, and changing the lives of each for a better entrepreneurial opportunity. Thank you Nick, and InterNACHI for your vision. We’re all successful, because we love what we do.

With all due respect… NO, I don’t think so!

The link you posted Jeff is only to English-speaking, international, certified members who prefer (and have chosen) to be visible members of North America InterNACHI. It is a very, very small subset of our worldwide operations.

We’re working on building inspector search sites in foreign languages so that we can list every member in the world. By 2018, we should top the 100K member mark of which only 1/5 will be U.S. + Canada.

How many mortgage lenders looks at the home inspection?
Home Inspection

That’s 6 major lenders that do NOT require a home inspection for a home loan.

Let’s hope it stays that way.

Almost all recommended one though.

That’s what we call… the best of both worlds. Banks officially recommend inspections but thankfully don’t require them.

When I worked for a lender in quality control, I never saw the inspection report. No one ever mentioned home inspections.

Which actually drove me crazy and originally got me interested in doing inspections. If I had to research and write an argument to Wall Street big wigs on why the appraisal was or was not valid, an inspection would have helped my cause.

Sure, $5,000 to $10,000 in needed or not needed repairs is minor compared to a million dollar loan, but when you’re talking a percentage of percent on the whole sale trading market, $10,000 suddenly makes a big difference.

Yes because if they did they would set a fee schedule and the SOP and home inspectors would be often working for the lender and not the buyer.

And then we’d have the CFPB all over us they way they are all over Escrow companies right now.

There are a lot of changes coming down the pipe as it relates to the lending and escrow process.

None of it will directly affect the inspection process, although I’m keeping my ear out for any ways we might be affected indirectly.

We don’t need forced demand for home inspections, that only grows the industry but doesn’t help the profession because of commoditization.

What we need is more ways for home inspectors to make more money.

That’s not entirely true either.

A company called Buyers Protection Group has a full page in ASHI’s magazine; “Actively seeking to acquire multi-inspector firms” and actively hiring independents.

Most Lenders do not require a full Home Inspection. Although, some require a four point, roof, and/or termite. I would assume that when lenders start requiring Full Home Inspections that would be presented directly to the Lenders, then there will be standardized reporting forms and formats. Most Underwriters would never be able (or willing) to read over 40+ page inspection reports which are presented via dozens of different forms, software providers, formats, etc. When/if this ever happens, standardized forms will be absolutely required and the inspector’s freedoms will be limited. Also, similar to appraisals, the Client would be the party ordering the Inspection. Which, in theory, would be the Lender. Thus, our responsibility would be to the Lender/Client.

Consolidation is coming without a doubt. The industry is populated with independant types and although I sympathize and appreciate the one man shop outfits that business model is long in the tooth.

There will always be great one man/ woman operations but like auto mechanics, realtors, doctors ect the real money will be made by larger outfits that offer routine but consistant results.

5 years from now Pillar to Post or Amerispec will offer what are “good paying” inspector jobs, many will setlle for that and the franchises will start owning their own stores, much like McDonalds.

I think this is probably the likely goal of any company that offers Home Buyer Warranties. Sell the warranty service by having inspectors sell it for you as non commissioned salespeople and then eventually buy or sqeeze them out to gain a presense in a geographic area. American Home Shield offers warranties and owns Amerispec and are in a position to do just that.

Its the American way and has been so since the Hudson Bay trading company gathered trappers and incorporated the company and the trappers into one of North Americas 1st Big Box stores.

I don’t think so. And the reason it won’t happen is InterNACHI. We are simply going to continue to provide more and more competitive advantages to our members than any franchise could ever dream of. They can’t keep up with I’ve already uncovered secret documents that show that Pillar to Post is actively steering their new franchisee prospects and owners away from InterNACHI because InterNACHI provides everything Pillar to Post provides times 1,000. In other words, they consider InterNACHI such a threat to their business model that they are willing to harm their own franchise owners rather than have them say “Hey, I joined InterNACHI and they provide all this for free… what are we paying Pillar to Post 11% of our gross for?

Statistically, and I credit InterNACHI for this, franchises have lost ground every year in our industry for the past 10 or so years. There may be consolidation, but it isn’t the franchises that are succeeding at it.

Whenever I see Dan Steward, CEO of Pillar to Post, I sing this song to him: :stuck_out_tongue: I think he hates me… and I know he hates:

Remember, if you are on a healthy 22% profit margin and you are paying Dan Steward 11% of your gross revenue, you are basically giving him HALF of the fruits of your labor. Half of every hour you work goes not to you, not to your wife, not to your future, and not to your kids… but to Dan Steward. And then to top it off, instead of helping you make more money by recommending that you join InterNACHI… he steers you over to one of those “nearly no benefits” associations that charge dues for little in return.

I’m glad your doing this and I think your correct to a point.

There is another forum that has its members promote their products and on the surface seems ok, but ultimately if you need to sell more service products the surest way is to make your products mandatory for members, if not degree then by inference such as “everyone who uses my products is better than those who don’t”, or by saying “our members are protected.” I don’t know when an organization crosses the line but most do at some point.

My saying the franchises will consolidate? I stick with that and think the McDonalds comparison is valid. At first all McDonalds (almost all) were franchises, now its 80% and the franchisee number will continue to shrink, good plan for corporate as it lets the franchises take the risks and at some point in the future McDonalds can buy the store but only buy the best performing stores.

Where this doesn’t hold water is many (most) franchises and large multi inspector firms are also InterNACHI members, and many require InterNACHI membership of their employees.

If an inspector working for the McDonalds of home inspectors gets the same benefits as the independent member, how does being a member of InterNACHI prevent consolidation?

Where I disagree with Paul is the agents, even though they are all under bigger umbrellas, are becoming more and more independent. Many of them never see their office; they work from home, from their car, and have little interaction with the corporate broker name on their business card. This keeps the industry relationship driven. Home buying is still an emotional process for many, and people want to do business with people they can trust.

McDonalds didn’t have an InterNACHI to go up against.

I should probably write an article explaining that franchisee owners should mathematically run their inspection businesses as low volume, high margin shops. Mathematically, the worst thing they can do is grow their volume. I know it seems nuts, but it is mathematically true. If you are a Pillar to Post franchise owner, the worst thing you can do is to build up a million dollar inspection business with 11% net profit margins… LOL.

Not all franchises are the same. Like you stated, many franchises push or even outright require their franchise owners to join InterNACHI. In turn, we give those inspectors many competitive advantages, which in turn helps them succeed, increase their margins (which helps the inspector/franchisee) and increase their gross sales (which helps the franchisor). That is not the case with all franchises and the absolute reverse for one franchisor in particular… Pillar to Post.

You answered your own question. The reverse is true. In other words, an InterNACHI member has as much, if not more, competitive advantages by virtue of his/her membership as the franchisee has by virtue of his/her franchise… at 1/25th the cost. Now if you are both, then you have both pistons firing for you. But that’s not the case for the poor Pillar to Post members who are essentially ordered to join a “nearly zero benefit” association. That “f the inspector” attitude will never lead to consolidation (as someone in an earlier post suggested) by Pillar to Post. Consolidation may take place in our industry, but it will come from a different direction.

Sorry, I didn’t mean for this conversation to end up a “Bash Pillar to Post’s CEO” thread.

Here in Vancouver BC, two of my friends who purchased homes had to provide a home inspection report to the bank to get their mortgage approved. I don’t think they all do it and not for everyone but it’s happening more and more.