Waiving a home inspection or choosing not to have one when purchasing property can be a negotiating tactic but it also might not be at the best idea. In this article wer’e going to talk about why people waive the home inspection, when it’s a good time to do so, and the dangers of negating that contingency.
A home inspection is a crucial part of the home buying process. This is a chance to learn as much about the inspection as you possibly can. Remember, this is probably one of the largest investments you’ll ever make so it only makes sense to learn as much as you can about it. You probably wouldn’t buy ½ $1 million portfolio stock investment without knowing as much about it as possible so why would you do that with real estate?
The home inspection will tell you just about everything you need to know about the property; its integrity, structural composition, construction, appliances, and if there are any major hazards such as asbestos, lead paint, faulty appliances, or areas of concern. When you purchase a home without a home inspection, you are waiving your right to negotiate with the seller on any repairs or replacements.
In today’s extremely competitive market and just about everywhere across the country, buyers are waiving all types of contingencies from financing to selling their own house before buying and of course, the inspection contingency. This contingency is in place to protect the buyer if something should show up on the inspection that makes the buyer wary of the purchase. The buyer then has recourse to come back to the seller and ask about repairs, replacements, or a general correction of the issue before the buyer finalizes the sale. If the buyer waives this contingency, they are essentially buying the home as is, no questions asked and are stuck with any problems that might arise in the future.
You can make a caveat in an inspection that states you want to have a home inspection but it will not deter you from purchasing the property. While the sellers may not go for it thinking that if there is something seriously wrong you’re going to bail anyway, it is something that you can do prior to purchasing or at least right after you finalize on the sale.
When is waiving a home inspection a good deal?
Generally speaking, real estate agents and inspectors only recommend waving a home inspection if you know what you’re looking for and can pick on any potential issues without a professional inspection. This usually isn’t the case for an average home buyer.
“Brand-new homes may be another situation where buyers will choose to waive the home inspection. Most buyers and their agents are 99% sure that the property is in good working order and that all the appliances work. A property that’s just a couple of years old may also have the same integrity. However, even brand-new construction homes can have their issues. Builders and developers can cut corners, forget things altogether, or cause hazards that you won’t know about until you actually live in the property.” - Sydney Buyer’s Agent, Hunter James
If you personally know the homebuilder who construction of the property you might feel more confident and savvy investors and experienced home flippers may choose to waive the inspection because of their trained eye.
One reason not to waive the home inspection is to get the home due to competition. You may regret that decision and it might be more conducive to your overall financial future to simply wait until you can get the home you really want including the inspection.
The dangers of waiving the home inspection.
Clearly the biggest disadvantage or con to waiving the home inspection is finding something after you close on the sale of the home. This can be detrimental and expensive. And unfortunately, once buyers have waive that home inspection and signed on the dotted line, they may have no recourse to go back to the seller even if the issue is a hazardous one or even illegal.
Buyers that choose to waive the home inspection are now on a “buyer beware” situation. The buyer is now responsible for any and all issues that arise now that they own the property. If the seller was dishonest and did not reveal or disclose certain issues with the home, the buyer still may not have any recourse to come back for a correction. This can open up some serious legal battles and be even more expensive.
Related: How to Avoid Home Buyer’s Remorse
Waiving the home inspection may also expose some issues about the property in general and the neighborhood. Easement issues, title insurance issues, water rights, and neighborhood boundary lines can all be sticky topics if the home inspection does not clearly state and define all of these issues.
While waiving the home inspection is not always a great idea, there are certain situations where it’s beneficial. Buyer should always discuss the options with their real estate agent and use a qualified buyers agent every single time they purchase to offer tips, suggestions, and experienced advice. Waiving the home inspection? It is the buyers prerogative, but definitely something to heavily consider before doing so.