Disputes Over Home Inspections

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 What Is a Home Inspection?

Home inspections allow the parties involved in a home sales transaction to identify the repairs that must be made to the property before the sale is completed and if there are any defects in the home. A local municipal board often requires a home inspection to ensure a house meets safety and zoning standards.

In addition, a home inspection can affect the price of the home. An individual may also want to have a home inspection if they are constructing an addition to their home, for example, another wing to their house or a deck.

In these cases, a home inspection is necessary to determine whether or not the new addition is permitted under the local housing laws and whether the structure would meet the applicable safety standards. Otherwise, the addition may be a waste of money and time to build a structure that would have to be torn down because it violated the local housing laws.

How Extensive Is a Home Inspection?

A home inspector will typically look for non-trivial issues. This means the inspector will not note every flaw in a home’s appearance or system.

Instead, a home inspector will look for problems that the reasonable, average homebuyer may find significant when purchasing the home. The inspector will also look for problems that may violate local housing codes, which may require, for example, that certain types of alarms be installed.

In general, the more thorough a home inspection is, the more that inspection will cost. The cost of a home inspection will also depend on the age and size of the home.

What Is the Importance of a Home Inspection?

A home inspection allows the buyer and the seller to participate in a real estate transaction while having all the relevant information about the home’s condition. A buyer typically wants to review a home inspection report before purchasing the home.

Under the law, if a home inspection report reveals an issue with a home, the buyer can insist on having that issue fixed before purchasing the home. Typically, a buyer will include a provision in the sales contract for the sale of the home that makes conducting an inspection a condition of the sale.

This provision can require that if any repairs are needed, those repairs must be paid for by the seller before the purchase will be completed. This provision may also give the buyer the right not to go through with the sale if the seller does not make the necessary repairs.

What Are Some Common Disputes Over Home Inspections?

A dispute over a home inspection or appraisal may arise for numerous reasons. In many cases, a home inspection is performed as part of the steps associated with selling a home.

Both of the parties to a home sales transaction have to agree regarding the price and value of the home. A home inspection may provide a starting point for the parties to use as a baseline for their agreement.

The buyer and seller, however, may still have issues related to the inspection, including:

  • The methods used when calculating the value of the home, for example, the fair market value versus individual inspector determinations;
  • What is considered during the appraisal, such as:
    • defects;
    • improvements;
    • additions; and
    • other issues;
  • Legal factors, for example, zoning and land use; and
  • Which of the parties will be responsible for paying for the home inspection.

Because of these issues, the home inspection or appraisal must be conducted in a way that the seller and the buyer can agree on. This way, the parties can move forward with the rest of the steps required for the home sales transaction.

How Are Home Inspection Disputes Resolved?

If a dispute arises related to the home inspection process or the results, the parties may have several options available they can choose to resolve it. For example, it is common practice to hire a second home inspector so that the parties can get a second opinion on the property.

The parties may also resolve their dispute by reviewing the contracts and inspection documents and amending them to meet their needs better. If there is a possibility that a home inspection is potentially fraudulent, it may be necessary to file a lawsuit to settle the dispute.

This is especially true in cases where one of the parties suffered a major loss or lost the title to their home due to fraud. For example, an inspector may work with the buyer or the seller to scam the other party into making unnecessary repairs.

If a home inspector conspires with a seller, they may falsify the report to force the buyer to pay for a repair that is not needed and split that money. In contrast, if the inspector conspires with a buyer, they may falsify the report to force the seller to make certain installations or repairs that may not be necessary but allow the buyer to obtain the services for free.

What Are the Remedies for Home Inspection Disputes?

Several different remedies may be available for a home inspection dispute, depending on the case’s circumstances and the relevant laws that apply.

Examples of common remedies used in home inspection disputes may include:

  • A monetary damages award is used to compensate the plaintiff for any losses suffered; and
  • An injunction requires the defendant to take some action, for example, transferring the property title to the appropriate party.

In certain cases, a violation may negatively affect a home inspector. For example, certified appraisal specialists may be required to pay fines or may even lose their licenses if they are found to be engaging in fraudulent practices.

What Are the Alternatives to a Home Inspection Lawsuit?

Instead of suing a home inspector, an individual who receives an inspection report containing material or significant errors may choose to hire a different home inspector to obtain a second opinion. An individual may also choose to use mediation to resolve a dispute.

Another option to pursue a claim against a home inspector is a binding arbitration.

Do I Need to Hire a Lawyer for Help with Home Inspection Issues?

Home inspections play a very important role in the real estate process. If you have any questions or concerns regarding home inspection laws or the appraisal process, it is important to consult with a real estate lawyer.

Your lawyer can advise you of the real estate laws in your state, the possible outcomes of your dispute, and how you can resolve any lingering issues. In addition, your attorney will know which laws are relevant to your issue and how they may affect your case.

If you must file a lawsuit because of your home inspection issue, your lawyer will represent you in court. Because a home purchase is such a significant investment, it is important to have a lawyer protecting your rights throughout the process.

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