Having the Home Inspected Before Proceeding to Pending

Step 5 in Edy’s series The Escrow Process for Buyers is Pending Inspection.

Once you have offered on a property, and the seller has accepted the offer (perhaps modified through negotiation)  Pending Inspection is the  final step before proceeding to “Pending” status.  As part of the contract we use an “Inspection Contingency” to give the buyer 10 days (or as agreed) after mutual acceptance to have the home inspected.  This is also the time for any additional inspections that are called for or that you would like to have, usually once the main inspection has been done.  Example of additional inspections would be a sewer scope, a structural inspection (which might be called for if the home is perched on a steep slope or has foundation questions), or having a roofer come and cast his professional eye over the condition of the roof.  One of my clients recently pointed out that they had insulation specialists come and quote what it would be to bring the attic insulation of their newly purchased 100 year old Craftsman up to code, and the insulation company  proposed a solution that would totally render the attic useless for the storage space the Buyers had planned.  Since the insulation contractors are focused exclusively on insulation, that’s the extent of their vision.  It’s important not to forget that you are the one who gets all the data and feedback and then makes the decisions on how it’s going to work out best for your family criteria.

If the Inspection does not meet the buyer’s “subjective approval” then he/she can disapprove the purchase and the earnest money is refunded.  But that is the “worst” that can happen; instead of disapproving the purchase, the buyer can request repairs or modifcations.  The seller can agree or not.  After this period of further inspection and negotiation comes a final agreement (if the purchase is not disapproved) and the sale proceeds to Pending.  Once Pending, the lender pursues the final loan process.  Also during the Pending period, the seller takes care of any agreed upon repairs etc.  (and the Buyer is well advised to make sure to do a final walk-through just before closing to make sure the repairs took place as agreed and in good form, we’ll address this in Step 16).