The Home Inspection Process
Once you have an offer accepted on a home the clock starts ticking for the buyer to conduct all inspections desired in the due diligence phase. Typically, the inspection period is 10 days from date of contract acceptance. All inspections must be complete and a written request for repairs on the Arizona real estate form known as the BINSR (Buyer Inspection Notice Seller Response) within that 10 day period. You will want to select a licensed and certified home inspector. Your real estate agent will be able to make recommendations to you to conduct the general home inspection. In Arizona we also recommend a termite inspection as we do have issues with wood destroying insects here. Click here for more information about wood destroying insects such as termites.
What inspections do I need?
In addition to the general home and termite inspection you may want to further examine areas that become known in the home inspection. For example, if roof issues are found the general inspector may recommend that you have a full roof inspection done by a licensed roofing contract. If evidence of mold is discovered you will want to have a company that specializes in mold remediation to inspection thoroughly. Yes, we do live in the desert but we do have mold here too. Pipes break, dishwashers floor, heavy monsoons arrive in the summer and there are a number of ways mold can get into your home. If the AC is not testing properly you may want to have an HVAC specialist inspection done. Homes that have pools should have a pool inspection completed. The Arizona Buyer Advisory will provide resources for you to research other items that may be important to you. If noise is an issue drive by the home at various times of the day, talk to the neighbors and check to see if any airports are nearby. Check to see if sex offenders live in the area. If you are a foreigner you will want to know more about how FIRPTA may affect you when you sell the home. This advisory will give you many websites and resources to check anything that is important to you in the 10 day inspection process.
Seller Property Disclosure Statement & CLUE
Part of the home inspection process is obtaining the seller property disclosure statement (SPDS) that we in the industry refer to as “spuds”. Although it is not required it is highly recommended that you receive a copy from the seller for at least as much information as they know. Sometimes the seller is the adult siblings of deceased parents and they may not know everything about the home but they can complete the form to the best of their ability. Sometimes an offer is made on a lender owned home where the lender requires waiver of the SPDS. That can be a dangerous situation. Although the lender did not live in the home, they do know some information about the home such as location, HOA fees and whether any repairs have been made while they have owned it. Often when a lender takes a home back it requires work. The lender may hire companies to replace carpet, appliances, counters, paint etc. If they discover something during that process and are requiring you to waive the SPDS they are asking you to give up information that could be very useful to you in making the home buying decision. Discuss this in detail with your buyer’s agent before making any waivers. You will also receive a CLUE report (insurance claims history) for the most recent 5 year period or as long as the home has been owned if shorter than 5 years. If claims have been filed you will want to get as much information as you can. If the home flooded how was it repaired? Was mold an issue? If they had mold do they have a mold remediation certificate to provide?
Following the inspection process
Once all inspections have been completed, the SPDS and CLUE have been reviewed, the CC&R’s reviewed (if the home has a homeowner association) then it is time to sit down with your agent to discuss what repairs you may want to ask the seller to correct. That will be done on the BINSR which will be given along with a copy of the inspection summary to the listing agent. The seller will have up to 5 days to respond to your request. They may repair all requested items or none. Or, they may repair some but not all. Once they respond in writing you will then have up to 5 additional days to accept their response or cancel the contract and receive your earnest money back. Normally, we advise buyers to ask for the major items or any safety/non-working or non-maintenance issues. Unless the home is brand new every home will have some general maintenance written into the inspection report. That is generally for the buyer’s information down the road and not for the seller to fix. The buyer’s agent will go over the inspection in detail with you and it is up to you to make the final decision on requested repairs.
Once that is complete the house moves to the next step. If you are financing the home it is typically the appraisal that comes next. If it is a cash sale the next step is reviewing the CC&R’s if you haven’t already, changing utilities to your name, filing address changes, lining up a moving company and working with the title company to sign necessary papers and wire funds for closing. Generally within two to three days prior to closing a final walk through will be done where you can examine the requested repairs and make sure they were done. The seller typically will provide receipts for those repairs for your records.
It can be a little overwhelming but a good real estate agent can walk you through every step of the process to make it as seamless as possible. The Kolb Team will be with you every step of the way. For more information on buying or selling a home in Chandler or Sun Lakes AZ contact us at 480-440-0849.