It’s called the Inspection Objection Deadline here in CO, but I know there are other names for the same thing used in other states. What’s it called in your state?
Home Inspection Contingency period which is usually 7-10 days or more and could also have an Appraisal Contingency which can last longer depending on the type of loan.
Drop Dead Date
That’s, typically, what it is called around here, too.(N.W. MI)
Home Inspection Contingency period
Welcome to Florida the land of as-is with right to inspect, take it or leave it.
Right now there are 2-4 bidders on a property & some are willing to go over the asking price - willing to make up the difference if it doesn’t appraise for sale price.
*PROPERTY INSPECTIONS AND RIGHT TO CANCEL: *
Buyer shall have ______ (if left blank, then 15) days
*after Effective Date (“Inspection Period”) within which to have such inspections of the Property performed as Buyer shall desire during the Inspection Period. *
If Buyer determines, in Buyer’s sole discretion, that the
Property is not acceptable to Buyer, Buyer may terminate this Contract by delivering written notice of such election to Seller prior to expiration of Inspection Period.
Unless Buyer exercises the right to terminate granted herein, Buyer accepts the physical condition of the Property and any violation of governmental, building, environmental,
and safety codes, restrictions, or requirements.
We like to say “prior to closing”.
Patrick, that’s Oregon state law?
Colorado now has 3 deadlines related to inspection. All deadlines are 11:59pm by default on the date stated.
Objection – When the buyer still wants to buy, but wants repairs and/or financial concession.
Termination – When the buyer can simply terminate … no reason required.
Resolution – Deadline for resolving the Objection. IF the buyer submitted an Inspection Objection, AND no resolution is reached in writing, the contract automatically dies … UNLESS the buyer withdraws the Objection before that date/time-stamp.
“Prior to closing” seems to be the regionally accepted phrase. The Oregon SOP doesn’t require us to specify -when- something should be done per se. I personally don’t say prior to closing very often.
Can you speak to the importance of an inspector suggesting whether they do it before closing or not? If I recommend a licensed/qualified professional review and correct as needed, who’s to say when that is done?
I don’t care if it’s before or after they own the house, that’s up to them, and how they negotiate their purchase.
I’m genuinely curious about your thoughts on this one.
Here’s what my agent (of 40 years experience in CO and WI) says about it:
“It’s the inspector’s job to make observations and to recommend consultation with the appropriate specialist(s) for more information where indicated. Beyond that, the inspector would be crossing into the agent’s territory (interfering with his/her agency agreement with the buyer) and potentially getting into contract negotiation/re-negotiation advice (which requires both a real estate license and an agency agreement with the buyer). Undesirable outcomes could include alienating the agent, being reported to the real estate commission for practicing without a license, or being sued by a buyer who relied on the inspector’s advice and the outcome was detrimental to the buyer’s best interest.”
It’s the real estate agent’s job to advise regarding contract dates and deadlines so the buyer knows when he/she needs to have received the inspection report and gathered any supplemental info needed for any written objection if one is desired; and to coach/advise the buyer how to approach an inspection objection, if any, in light of all factors around the transaction. Those factors, known best by the agent and buyer, may include the already agreed contract price relative to the market for such a home … buyer and seller motivation and urgency … possible price reduction already negotiated with property condition in mind … possible financial concession other than price already negotiated (assistance with buyer’s closing costs, for example) … possible early possession for storage or even occupancy before closing, etc.
I think I’m safe in believing the ‘licensure line’ that the inspector should not cross is similarly true nationwide. There may be nuances in escrow states and/or states where attorneys control more of the transaction, but I don’t think it would ever be a good idea for the inspector to stray outside the scope and limitations of the inspection, i.e. “Here’s what I see. Here’s what I think about that based on my observations and experience. You may want to consult an expert in that field for more information.”
The due diligence period in North Carolina is a negotiated period of time during which a buyer has the opportunity to conduct their “due diligence” before deciding to move forward with the purchase of the home. For both buyer and seller it can be a tense period of surprises and decision-making.
Usually the due diligence period is somewhere between 14 and 30 days and it begins as soon as the contract is signed by both parties — once you are “under contract.” During this time, the buyer will have a professional home inspection, HVAC inspection, and termite inspection completed. They may also have other inspections such as a septic inspection or radon inspection
Once the due diligence period has passed and the buyer has not terminated the contract the process then move to closing.
In Maryland we don’t really need to concern ourselves with all that. The State SOP lays out specifically how long we have to deliver the report and the exclusionary language that must be included in 14 pt. BOLD type:
§ 164A01 Report; limitation of liability
(a) A licensed home inspector shall give to each person for whom the licensee performs a home inspection for compensation or to the person's representative, a written report that states: (1) the scope and the exclusions of the inspection; (2) the conditions observed during the home inspection that are subject to the adopted standards of practice and code of ethics approved by the Commission; (3) the license number of the licensee; and (4) a disclosure in 14-point bold type that includes the following statements: (i) "An inspection is intended to assist in the evaluation of the overall condition of a building. The inspection is based on observation of the visible and apparent condition of the building and its components on the date of the inspection"; (ii) "The results of this home inspection are not intended to make any representation regarding latent or concealed defects that may exist, and no warranty or guaranty is expressed or implied"; (iii) "If your home inspector is not a licensed structural engineer or other professional whose license authorizes the rendering of an opinion as to structural integrity of a building or the condition of its components or systems, you may wish to seek the professional opinion of a licensed structural engineer or other professional regarding any possible defects or other observations set forth in this report"; and (iv) "Only home inspections performed by Maryland licensed home inspectors will be recognized by the buyer as a valid home inspection under a real estate contract". (b) The licensee shall give the person or the person's representative the report: (1) by the date set in a written agreement by the parties to the home inspection; or (2) within 7 business days after the home inspection was performed, if no date was set in a written agreement by the parties to the home inspection.
© Any limitation of the liability of the licensee for any damages resulting from the report on the home inspection shall be agreed to in writing by the parties to the home inspection prior to the performance of the home inspection.
If it takes you 7 days to do the report you won’t get any work. There are times when the buyer waited too long and wants it quick (same day) but most of my reports are delivered within 24 hours. Time constraints of the Realtor’s contract really don’t concern me but I have noticed most don’t give much time for the Home Inspection and it is an item negotiated in the contract (like any contract it can be changed).
There are a lot of MD Home inspectors that don’t include any of that in their report.
The transaction window of time relating to inspection seems to vary quite a bit with different states. According from what I’ve learned, I’m deleting anything in my narratives that mentions those kinds of time periods, since that’s really between the client and the agent.
Unfortunately, there are more agents out there that are either ignorant, heartless or in desperate need of a transaction than there are good agents doing right by the client.
That said, I have only a half a dozen or so narratives where I reccomend taking an action prior to the end of an option period.
For example: A roof that is relatively worn or “close to the end of its useful life”, along with telling them the condition of the roof, I will recommend the client obtain an estimate for replacement prior to the end of their option period to have an accurate understanding of an expense they may incur in the near future.
My reasoning is: Suppose the client buys knowing that the roof may need replacing soon (a few yrs) & is thinking $6k based on inaccurate internet research or a buyer agent giving them a bullshit number to preserve the sale. Then in a couple yrs. learns that the real cost is around $20k. They are now unprepared, will endure hardship or simply upset they were duped.
While I am not on the hook (no estimate provided by me) I know this potential cost is significant enough that it should be know/considered prior to losing their ability to negotiate or terminate the contract.
Added bonus, it helps cut down on the asking me for an estimate. (Which I don’t provided)
Call the shingle wholesaler and get 3 top companies to give bids and use the middle bid?
Oh…sometimes I will give them a broad range estimate, verbally. (I know our local costs)
The deal is that pricing can vary greatly depending upon their choices or expectations.
Reputable company or fly-by-night
Synthetic underlayment or felt
3-tab shingles, architectural, Duration (50yr)
Color & brand
New roof jacks, vents & flashing or reuse the old ones
I like to tell them it is best to speak with a roofer about the different options available & get a pricing estimate for what they want rather than an extremely broad range estimate from me.
As already described in Texas we have a paid for option period where the buyer has the opportunity to perform all due diligence. The buyer has the right to back out for any reason whatsoever and can wake up one day in the option period, decide they are having a bad hair day, and back out of the transaction losing only the paid option period fee.
If a Real Estate Sales Person in Texas has an issue with any such wording in an Inspector’s report they would need to take it up with the Texas Real Estate Commission (TREC). This is in the preamble of every promulgated report format and added by TREC. Bold and italic is by me for emphasis.
ITEMS IDENTIFIED IN THE REPORT DO NOT OBLIGATE ANY PARTY TO MAKE REPAIRS OR TAKE OTHER ACTIONS, NOR IS THE PURCHASER REQUIRED TO REQUEST THAT THE SELLER TAKE ANY ACTION. When a deficiency is reported, it is the client’s responsibility to obtain further evaluations and/or cost estimates from qualified service professionals. Any such follow-up should take place prior to the expiration of any time limitations such as option periods. Evaluations by qualified tradesmen may lead to the discovery of additional deficiencies which may involve additional repair costs. Failure to address deficiencies or comments noted in this report may lead to further damage of the structure or systems and add to the original repair costs. The inspector is not required to provide follow-up services to verify that proper repairs have been made.
But Joe Ferry says it’s fine.
Same as in my province, Marcel. Home Inspection Contingency Period.
The time period can be amended, depending upon several factors. As well, the inspection contingency offer can be amended as well.