Selling your house is a long, stressful process. One of the steps that almost every homeowner will go through during the process is having their home inspected. If you’re selling your home to someone who is using traditional financing methods, such as a conventional or FHA mortgage, these inspections are generally required by the bank issuing the loan. The thing to remember is, most home inspectors are going to find something to include in their report, but most of the time these will be just minor issues. However, homeowners can get caught off guard when an inspection finds a major issue that prevents the mortgage from being processed. Even though the home inspector will provide the buyer with a report of any issue with your home, there are only a few major issues that have the potential to prevent the loan from being processed. Generally, these are issues that are considered to make the home unsafe or cause significant damage to the home if not fixed.
Here are some common health and safety issues that cause homes to fail inspection reports:
- Roofing issues
- Plumbing issues
- Foundation problems
- Electrical problems
- Window & door issues
- Chimney damage
- Termites & pests
- Asbestos or lead paint
- Elevated radon levels
- Mold problems
- HVAC issues
The best option, whenever possible, is to simply remedy the issue before closing by paying for the repair. Some issues, like a new water heater, are relatively cheap compared to the other costs associated with selling your home. If you pay for repairs to be done, it’s advisable to get at least three quotes from trustworthy contractors. You will also have to agree on a deadline with your buyer that gives enough leeway for a re-inspection before closing. Assuming all goes well, your house will likely pass inspection the second time, and then you can proceed with the sale.
Selling your house is already expensive. Many times homeowners simply don’t have thousands of dollars to put into repairs prior to closing. In this situation, a homeowner can ask the buyer to complete the repairs in exchange for a credit or reduction in the purchase price if the buyer has approval with their lender.
Lastly, if your home isn’t in mint condition and you and the buyer cannot negotiate a way to remedy the problem, the next best step may be to consider finding an all-cash buyer. Just remember that cash buyers will likely expect a discount for their willingness to address these issues themselves. But if your home has failed inspection and you aren’t able to pay for repairs, this can be a great option.
Now you know what to do when your home doesn’t pass inspection.