By Robert J. Bruss
Tribune Media Services

A few months ago, I read a great real estate book called “Inspecting a House” by Rex Cauldwell (Taunton Press, Newtown, CT, 2001, $24.95, 260 pages). It explained why home buyers should make their home purchase offers contingent upon their approval of a satisfactory, professional home-inspection report.

This book reminded me how, in the last few years, the home-purchase laws and court decisions of virtually every state have evolved away from “caveat emptor” (let the buyer beware). Today, the legal rule in many states has become “Home seller (and thy real estate agent) beware of the home buyer and their professional home inspector.”

The results are (1) the smartest sellers have a professional inspection before putting their house on the market for sale and (2) the smartest buyers include a contingency in their purchase offer for a satisfactory, professional home inspection. Even condominium buyers are obtaining professional home inspections, not only of the condo but of the homeowner association common areas.

To protect sellers and buyers from lawsuits, several states now require sellers to disclose in writing all known defects. In addition, the best agents ask their sellers to fill out additional disclosure forms stating the condition of various home components.

But these voluntary or required home-sale disclosure forms are just the beginning. The purpose of defect disclosure, in addition to preventing lawsuits after the sale closes, is to make the buyer aware of any defects to consider when buying the home.

However, many sellers are honestly not aware of defects in their residences. For example, I haven’t been up in the attic of my house for years. The roof could be leaking there, but unless the water seeps into one of the rooms, I wouldn’t know about it. However, if I hire a professional home inspector, he or she will surely check my attic for signs of roof leaks, such as water stains on the rafters.

Within the last 10 to 15 years, professional home inspections have gained acceptance in most states. Buyers recognize their obvious value, and agents understand that full disclosure prevents after-sale lawsuits.

Even sellers have reluctantly accepted home-inspection contingency clauses in purchase offers, realizing if the buyer purchases with an inspection report obtained by the buyer, chances of after-sale litigation over an undisclosed defect become virtually nil.

Only the states of California, Oregon, Minnesota and Texas minimally regulate professional home inspectors. The field is so wide open, virtually anyone can print business cards and stationery, calling themselves home inspectors.

Home inspectors’ competence varies widely. Retired general contractors are often the best inspectors because of their construction experience. But well-trained inspectors without construction experience are often excellent, too, thanks to use of checklists and modern test equipment that the “old-timers” often don’t use.

The best professional home inspectors are usually members of a professional home-inspection organization that requires exams and on-the-job experience before approving membership. The best-known is the American Society of Home Inspectors (ASHI). To locate local ASHI members, phone (800) 743-2744, go to www.ashi.com, or check the local yellow pages under “Building Inspections.” Another good home-inspection organization is the National Association of

Home Inspectors (www.nahi.org).

Smart buyers (and sellers) accompany the professional home inspector, after the home purchase offer has been accepted by the seller. It will be profitable time well-spent, especially if the buyer’s agent is also present for the inspection.

Inspectors are usually glad to discuss any defects they discover. My experience has been inspectors often make important comments that never get into their written reports.

To illustrate, I recall one professional home inspector telling me the water heater was working fine but was nearing the end of its useful life. He was right. About a month after I bought that house, the water heater sprung a major leak. Fortunately, I had a one-year home warranty policy (paid for by the seller), so my only expense was a $35 service fee to get a new water heater under the warranty policy.

However, don’t expect home inspectors to know everything. If an item looks like it could be defective but the inspector isn’t certain, their written report will often recommend a further inspection by an expert. For example, if an inspector can’t find anything wrong with the roof but if it looks worn, the inspector will often recommend the buyer consult a roof inspector.

Some home inspectors are really repairmen in disguise looking for work. Although most home inspectors I’ve encountered will give me a verbal “ballpark” cost to repair a defect, it would be a conflict of interest if that inspector were also in the home-repair business or if the inspector referred me to a repair company.

Occasionally, an inspector will be instructed by the buyer to create home defects, which the buyer will then use to renegotiate the purchase price to drive it down. This happened to me a few years ago with a house I was selling.

The buyer’s home inspector, a retired contractor, said the furnace was defective and should be replaced. Since I hired another professional inspector at the time of listing the house for sale with a Realtor, I didn’t agree because my inspector reported the furnace was in good condition.

To satisfy my buyer, I arranged for a local gas company representative and a furnace repairman to check the furnace. Both agreed there was nothing wrong. I think the buyer had told the inspector to report the furnace was defective because the buyer wanted me to pay for a new furnace.

If the buyer’s professional inspector discovers a serious, previously undisclosed defect, several alternatives are available: (1) The buyer can cancel the purchase and get a refund of the earnest money deposit, (2) the seller can agree to give a credit or pay for repair of the discovered defect, or (3) the seller can refuse to change the terms of the sale, leaving the buyer with the choice of either canceling the purchase or buying the house “as is,” in its present condition.

Professional home-inspection contingency clauses are found in most home-purchase contracts today. Such inspections protect both sellers and buyers, as well as their realty agents, from unexpected post-sale lawsuits for undisclosed defects.

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