Legal Talk: The Importance of Getting a Home Inspection

By: Will Martin | General Counsel

Obtaining a professional home inspection is perhaps the single most important thing a buyer can do to protect him or herself. Here are a few tips when arranging and reviewing a home inspection.*

Scheduling a Home Inspection

In North Carolina, a home inspection done for compensation must be prepared by a home inspector or contractor licensed by the North Carolina Home Inspector Licensure Board (NC HILB). If two or more components of a residential building (heating system, cooling system, plumbing system, electrical system, structural components, foundation, roof, masonry structure, exterior and interior components or any other related residential housing component) are to be reviewed, the inspector must be licensed. All licensed home inspectors in North Carolina are required to provide a written contract that describes the services to be performed, standards of practice, limitations and the cost of the services. This contract is required to be signed before the home inspection is performed. A buyer should carefully review the inspector’s proposal to determine the scope of the inspection, and be sure to review what components will be inspected.

A buyer can also review state home inspector requirements on the website of the NC Home Inspector Licensure Board (NC HILB). Additional information about inspections and inspectors is available on the websites of the North Carolina American Society of Home Inspectors, the North Carolina Licensed Home Inspectors Association and the International Association of Certified Home Inspectors.

Reviewing the Home Inspection Report

A professional home inspection report provides detailed information about the home’s physical condition, its systems and fixtures and usually notes any potential future problems. The buyer should read the report itself and not just the summary page to ensure he or she understands all aspects of the inspection and report. The summary page is intended to cover the major concerns found during inspection, but may not be the only issues discovered. A buyer should not rely upon reports done for others (the seller and/or previous buyers) because the report may not be current and/or accurate and the buyer likely would have no recourse against an inspector he or she has not retained.

The Contract and Due Diligence Period

The standard form used in many residential real estate sales in North Carolina is the Offer to Purchase and Contract (form 2-T) (the “Contract”), which is jointly-approved by NC REALTORS® and the NC Bar Association. The Contract permits the buyer to investigate the property for an agreed-upon period of time (known as the “Due Diligence Period”), and to terminate the Contract for any reason or no reason during the Due Diligence Period. A buyer should take advantage of this important right by obtaining his or her own professional home inspection report from a licensed professional inspector during the Due Diligence Period. If a professional inspection shows defects in the property, the buyer may attempt to reach an agreement with the seller to repair the defects, or may terminate the Contract. Remember, unless otherwise provided for in the Contract, the cost of the inspection will not be refunded to the buyer if he or she terminates the Contract.

If a sales contract other than the standard Contract is used, it is important that it contain a clause allowing the buyer to terminate the agreement if a professional inspection shows defects in the property. A real estate agent may assist a buyer in completing a pre-printed sales contract form and is expected to possess a basic understanding about the buyer and seller’s rights and responsibilities under the standard Contract form. However, a real estate agent is not qualified to give a buyer advice about his or her rights and responsibilities under a non-standard sales contract form. A buyer should consult a North Carolina real estate attorney under such circumstances.

* The information in this article was taken from the North Carolina Buyer Advisory, a consumer information publication of the NC REALTORS®.

NC REALTORS® provides articles on legal topics as a member service. They are general statements of applicable legal and ethical principles for member education only. They do not constitute legal advice. The services of a private attorney should be sought for legal advice.

© Copyright 2017. North Carolina Association of REALTORS®, Inc. This article is intended solely for the benefit of NC REALTORS® members, who may reproduce and distribute it to other NC REALTORS® members and their clients, provided it is reproduced in its entirety without any change to its format or content, including disclaimer and copyright notice, and provided that any such reproduction is not intended for monetary gain. Any unauthorized reproduction, use or distribution is prohibited.

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