Home Buyers

You Need a Home Inspection Because...
Buying a home is one of the expensive purchases you will make in your lifetime, so you should be sure that the home you want to buy is in good condition. A home inspection is an evaluation of a homes condition by a professional. During an inspection, a qualified inspector takes an in-depth and impartial look at the property you plan to buy. The inspector will:

  • Evaluate the physical condition: the structure, construction and mechanical systems.
  • Identify items that should be repaired or replaced.
  • Estimate the remaining useful life of the major systems (such as electrical, plumbing, heating, air conditioning), equipment, structure and finishes.

Home Inspections Are Not Appraisals

  • The home inspector does not estimate the value of the house.
  • A property appraisal is a document that provides an estimate of the market value of a property.
  • Lenders require appraisals on properties prior to loan approval to ensure that the mortgage loan amount is not more than the value of the property.
  • Appraisals are for lenders; home inspections are for buyers.

FHA, which is part of the U.S. Department of Housing and Urban Development (HUD), requires lenders to obtain appraisals of properties securing FHA-insured loans. FHA requires appraisals for three reasons:

  • To estimate the market value of the property.
  • To make sure that the property meets FHA minimum property requirements/standards (health and safety).
  • To make sure that the property is marketable.
    The FHA appraisal process will note property deficiencies that are readily observable and found not in compliance with HUDs minimum property requirements/standards (Handbook 4905.1 REV-1 and Handbook 4910.1). These deficiencies may not be the same as those items noted in a home inspection report.

About FHA Home Inspections

  • FHA helps individuals and families become homeowners by providing lenders with mortgage insurance for certain loans.
  • FHA does not guarantee the value or condition of your future home, and FHA does not perform home inspections. If you find problems with your new home after closing, FHA cannot give or lend you money for repairs, nor can it buy the home back from you.
  • That is why it is so important for you, the buyer, to get an independent home inspection. Ask a qualified home inspector to thoroughly examine the physical condition of your future home and give you the information you need to make a wise decision.

The Bottom Line: Spending Hundreds May Save Thousands

When you make a written offer on a home, you should insist that the contract state that the offer is contingent on a inspection conducted by a professional inspector. You will have to pay for the inspection yourself, but it could keep you from buying a house that will cost you far more in repairs down the road. If you are satisfied with the results of the inspection, then your offer can proceed.

FHA does not guarantee the value or condition of your potential new home, and FHA does not perform home inspections.