Payment Question.

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1

Originally Posted By: Russell Stephens
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I am in the process of starting in the home inspection industry, and I have a lot of questions. One that has me stumped is when do you collect payment after the closing, after you deliver the inspection report, right after inspection? Any help would be greatly appreciated.

2

Originally Posted By: gbeaumont
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Hi Russell,


welcome to Nachi.


It tends to vary from region to region, but all inspectors want to get paid at the time of inspection, usually whilst still on site with the buyer. I do know that on occasions that the inspector has been paid out of escrow after the closing but that is rare and no one likes to do it. You stand a much better chance of not having any problems by stating to the client that you expect to be paid at the time of inspection.

Regards

Gerry

--
Gerry Beaumont
NACHI Education Committee
e-mail : education@nachi.org
NACHI phone 484-429-5466

Inspection Depot Education
gbeaumont@inspectiondepot.com

"Education is a journey, not a destination"

3

Originally Posted By: Russell Stephens
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Thanks Gerry I appreciate the fast response to the question. I have been stumped on that one. I am still a few months from opening shop. I guess i still have alot to learn.

4

Originally Posted By: mbailey
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Hi Russell,


Welcome aboard.

For us the key phrase is ?payment at, or before, the time of inspection?. Be upfront about it with your clients ? in regards to this and a great many other things in this biz? you set the expectations for the client.

--
Mark Bailey
Stonegate Property Inspections LLC
Ponca, NE

5

Originally Posted By: jhagarty
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–
Joseph Hagarty


HouseMaster / Main Line, PA
joseph.hagarty@housemaster.com
www.householdinspector.com

Phone: 610-399-9864
Fax : 610-399-9865

HouseMaster. Home inspections. Done right.
6

Originally Posted By: ismetaniuk
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This membership was a big waste of my time!

–
Igor


Top To Bottom Inspections


Glen Spey, NY

7

Originally Posted By: Russell Stephens
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I just want to say thank you to everyone that is helping me I have experience in the construction field and I am currently a Termite inspector and Certified pest control operator in wv and I am looking to change fields there is alot of stuff I still have to learn. I will be joining NACHI soon.

8

Originally Posted By: rray
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Joseph Hagarty wrote:
Payment before the start of the inspection on the day of inspection.

That is after the contracts are signed as well. That is more important than the actual payment.


B I N G O !

This is the only industry I've been in (and I've been in a lot) where I get paid before I do the job or I don't do the job. And I did walk once. Have I made some exceptions? Yes. Ever been paid through escrow? No, and will never go there; too many problems.

WDI inspections here in San Diego County are still 100% the seller's responsibility.

--
Home inspections. . . .
One home at a time.

9

Originally Posted By: chorne
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Hi Russel,


My Co. policy is straight forward, when on the phone with
the potential client, after booking the inspection I
very matter of factly say, "You will receive the report
that day on site when the Inspection is complete, and the payment
is due at the end of the Inspection"
almost every client says Oh, that is great I don't have
to wait for the report, they are happy and you don't
have to worry about any confusion about when you get
paid. It's primarily a cash business, no accounts receivable.
Hope this helps,

Carla

10

Originally Posted By: rray
This post was automatically imported from our archived forum.


My liability (case law) is such in this state that I would never consider providing a report on site. They get the report later, typically within 24 hours, sometimes 12 hours, sometimes 36 hours. Depends on condo, SFR, duplex, multi, and when we complete the inspection. But I never wait to get paid. Payment prior to or at the start of the inspection, never at the end.

–
Home inspections. . . .


One home at a time.


11

Originally Posted By: mbailey
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Russel ? I am curious in regards to your statement about not being able to provide onsite reports due to case law liability issues. Can you expound a bit or should this be considered one of those California things?

–
Mark Bailey


Stonegate Property Inspections LLC


Ponca, NE

12

Originally Posted By: jhagarty
This post was automatically imported from our archived forum.


icon_question.gif

–
Joseph Hagarty


HouseMaster / Main Line, PA
joseph.hagarty@housemaster.com
www.householdinspector.com

Phone: 610-399-9864
Fax : 610-399-9865

HouseMaster. Home inspections. Done right.
13

Originally Posted By: rray
This post was automatically imported from our archived forum.


Since neither I nor my attorneys are familiar with the other 49 states, I guess I would have to say that it’s a California thing.


The case law my attorneys brought to my attention specifically concerns mistakes, omissions, and errors that come into play when one fails to analyze the conditions properly, alert the Client appropriately, and provide the appropriate recommendations. Checklists are the major culprit because they make it easy to check the wrong thing, make the wrong recommendations, and gloss over something that should not be glossed over.

Think about the questions that get posted on these message boards. Many of them go something like this, "This morning I inspected . . . and . . . . What do you all think?" An on-site report makes it difficult to put that research that you've done down on paper. Additional case law doesn't seem to like follow-up letters since they tend to get lost. So I do all my research, put everything in one report, and am done with it. Typically takes 12-36 hours to do a good, thorough job for my Clients.

Especially for new inspectors who may have questions about something, checklists and on-site reports in this state definitely appear to increase liability. Additionally, we have four-year liability here in California, so one really wants to be sure that one has analyzed the conditions properly, alerted the Client appropriately, and made the appropriate recommendations, and that all of that is done in one complete report with no addenda, etc. In the heat of the inspection (dogs, black widow spiders, dangerous conditions, Realtors yapping, Clients asking questions, children asking for money, gum, and candy), it's just too easy to miss something at the inspection. I have missed many things at the inspection, yes. Not afraid to admit it. Fortunately, when I get back to the office, analyze my notes, look at the pictures, and create the reports, so far my inspectors and I haven't missed putting something in the report with the appropriate analysis and recommendation.

Also, the statistics that my E&O insurance carrier provided me indicates that failure to analyze properly and failure to make appropriate recommendations are among the top ten problems.

--
Home inspections. . . .
One home at a time.

14

Originally Posted By: rking
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Wow Russell,


That is quite the explanation! I am just new doing inspections in Ontario Canada, just north of Toronto and I had a very difficult time getting E & O insurance because the insurance carriers are annoyed at the "nuisance" claims.
However, I am doing onsite reports, but keeping in mind that if I see something I do not quite understand or need to research further I will tell my clients that, put it in writing, and then get back to them with an answer ASAP.
Missing something and getting sued, and consequently losing everything I have worked twenty years in construction to get, scares the hell out of me. But that makes me takes my time and be just a little more careful.
It is a tough occupation, but I think it is worth it!

--
Muskoka Home Inspections
"Wisdom is the Anticipation of the Consequences"
Steering Committee Member At Large

15

Originally Posted By: rray
This post was automatically imported from our archived forum.


Robert King wrote:
Missing something and getting sued, and consequently losing everything I have worked twenty years in construction to get, scares the hell out of me.


I obviously don't know anything about Canada, but in most of the States, incorporating your business can provide a lot of protection against losing everything. It won't help in the case of massive fraud, negligence, and incompetence (see Worldcom, Enron, Martha Stewart, Arthur Andersen, etc.)

--
Home inspections. . . .
One home at a time.

16

Originally Posted By: rking
This post was automatically imported from our archived forum.


Hi Russel,


I believe our laws are similar to yours. Incorporation protects a company where there are multiple share or stockholders, but as a sole proprietor I would be the company, incorporation would delay the process slightly but the outcome would be the same. The big advantage up here in incorporating is the tax benefits. Our taxes are a little ridiculous, but we still have to live with it. icon_cry.gif icon_mad.gif

--
Muskoka Home Inspections
"Wisdom is the Anticipation of the Consequences"
Steering Committee Member At Large

17

Originally Posted By: rray
This post was automatically imported from our archived forum.


Your taxes may be ridiculous, but you have a health plan!


When we incorporate here, even if only an individual, we are no longer a sole proprietor. We are now officers of the corporation. I hold all three offices right now although I'm going to relinquish one shortly.

Certain laws protect certain assets of corporation officers, whereas most sole proprietorship laws do not. So even for individuals who are the sole owners of their companies, incorporation usually makes sense to protect certain assets.

--
Home inspections. . . .
One home at a time.

18

Originally Posted By: rking
This post was automatically imported from our archived forum.


Good One Russel!!!


Yes we do have 'free' health care up here, but our extraordinary taxes, other than Alberta where there is NO personal provincial income tax, pay for that, or so we are told.
Your laws are relatively the same then as ours, but as it was explained to me by a lawyer specialising in commercial and corporations that the courts have a right to go after any and all shareholders for anything that will cover costs and/or damages. But generally if there are more than one or two shareholders they don't bother because it is too much work!
But we do have health care!

--
Muskoka Home Inspections
"Wisdom is the Anticipation of the Consequences"
Steering Committee Member At Large

19

Originally Posted By: rray
This post was automatically imported from our archived forum.


Robert King wrote:
. . .courts have a right to go after any and all shareholders for anything that will cover costs and/or damages. But generally if there are more than one or two shareholders they don't bother because it is too much work!


Homesteads, for example, (and certain other assets) are protected except in matters of fraud, embezzlement, etc., as happened to the Enron executives, Worldcom, and others. If you buy a home through fraudulent means, embezzlement, etc., then the courts can force you to sell the home to pay for damages. And, of course, those second, third, fourth, fifth, and sixth homes that those Enron executives had get taken by the courts. There's only four seasons; why would one need six homes?

--
Home inspections. . . .
One home at a time.

20

Originally Posted By: rking
This post was automatically imported from our archived forum.


Russel,


Are you sure you are an HI, not a lawyer in disguise?
If you know your houses as well; you must have a good business!
Kudos!!!

--
Muskoka Home Inspections
"Wisdom is the Anticipation of the Consequences"
Steering Committee Member At Large