Home Inspection Laws - Information For Home Buyers, Sellers and Real Estate Professionals on a National and Local Basis

Whether you are selling your house and looking for a pre-listing home inspection, or purchasing the house and need a standard home inspection during the inspection contingency period, it is important for you to understand a little bit about laws and regulations regarding home inspectors across the country.

More, Real Estate Professionals will benefit from these thoughts and the suggestions at the bottom. All of this information is relative to consumers and professionals alike on a national basis.

Good Law

Good laws are ones that may have some small problems in them (no law is perfect), but the aim is a complete protection of the consumer. These "good laws" require the following items, and more:

1. Errors and Omissions Insurance (claims made) - Even great home inspectors can and will miss something along the road. Many experienced home inspectors may inspect over 5,6,700 houses or more a year. What is important for you as home owners isn't to find an inspector who makes cliams that he can't back up, like "I will never miss anything". What you need is an inspector that is mature enough to admit that it is a possibility and one that has taken the procautions to protect YOU if such an event took place. This is where Errors and Omissions Insurance comes in. Typical coverate on EandO insurance will be at least $500,000. A Bond, while valuable, is NOT a good replacement for EandO insurance. Almost every state that has good law will require this.

2. Bond: A bond can be used for some small items. States with good law require that home inspectors carry both EandO insurance AND a bond. Good home inspectors in States that do not require this will still have it, as they are out there for a YOU!

3. Education: Good laws will require the home inspector to put their "knowledge" to the test--they will be required to be tested. Many states use the exam produced by the National Home Inspectors Examination Board. It is a difficult test that actually says something about a home inspector's knowledge. Also, the State will require that home inspectors maintain at least 20 hours of formal (outside of the home) education per year, so as to stay on top of the field.

4. National Associations: Good laws will require that the home inspector be a full member of a nationally recognized home inspection association. The top three are: 1. The American Society of Home Inspectors (ASHI.org), 2. The National Association of Home Inspectors (NAHI.org), 3. The National Association of Certified Home Inspectors (NACHI.org). These associations also have their own required continuing education that members have to maintain throughout the year. They also have standards of practice and codes of ethics that the home inspectors must maintain. Thus, subsequently, the state will be requiring good ethics on the part of the inspectors because they are in these nationally recognized home inspection associations.

5. Conflicts of Interest: Good law will make sure that home inspectors are NOT offering carpentry or contruction work on homes that they inspect, as it is a blatant conflict of interest. Most states and nationally recognized associations, mandate that home inspectors can not do work on a home that they inspect for a period of, at least, one year after the completion of the home inspection.

Another conflict of interest is when home inspectors PAY real estate professionals for referrals. Referrals are excellent and should be welcomed, but paid referrals are conflicts of interest.

Oregon and Washington State

There are pros and cons in both states.

Pros for Oregon

Oregon requires that home inspectors be members of nationally recognized associations, that they carry a bond and errors and omissions insurance, that they be certified by the state through various means, and that they have no conflicts of interest.

Cons for Oregon

Oregon does not require their home inspectors to know anything about Wood Destorying Organisms and Insects, such as Termites, Carpenter Ants, Moisture Ants, Mold, Wood Decay, etc. In the NW, these are very important.

Cons For Washington State

At this time, Washington State does not require that home inspectors be licensed or certified with the State for most things surrounding a home inspection. Washington State does not require home inspectors to have Errors and Omissions Insurance or a Bond, thus home inspectors are left vulnerable unless the home inspector they choose has these protective means. Washington State does not test or educate or maintain the education of home inspectors for most items surrounding a home inspection.

Pros for Washingtion State

The only part of the home inspection process that Washington State governs are the items surrounding "pest and dry rot" or "Wood Destroying Organisms", such as Termites, Carpenter Ants, etc. If a home inspector comments on insects, decay or conditions that are conducive to these things, they must be licensed by the Washington State Department of Agriculture. To be licensed, however, a home inspector merely has to provide $45 and take a 100 question test and get a "C" on it. From experience, it is not difficult.

States that Have Good Legislation for Home Inspectors

If you would like to see a list of States that have good legislation on the books, follow this URL: http://www.ashi.org/inspectors/state.asp

Regardless of What State You Are In, You Should Do the Following:

1. Make sure that your home inspector has Errors and Omissions Insurance.

2. Make sure your home inspector has a Bond.

3. Make sure your home inspector is a member of at least one of the following nationally recognized home inspection associations: www.ASHI.org, www.NAHI.org, www.NACHI.org.

4. Ask your home inspector how long he or she has been doing home inspections and ask them how many inspections they have completed. You can't argue with experience, and many "home inspectors" are simply riding the wave of a strong real estate market in many areas across the country. Sometimes home inspectors have been "doing home inspections" for 2-3 years, but do it as a side job and perform as little as 15-50 inspections per year. Make sure you ask, and if necessary, ask for proof.

5. Ask your home inspector for a list of qualified references. Most who have been doing home inspections for a long period of time will have a ready list that you can use if that would make you feel comfortable.

Extras:

1. Does your home inspector provide computer generated reports that are delivered on site? Many home inspectors are still using "check lists" that are hand written and not very professional. Others are using the computer, but getting you the inspection report the next day. You want to be able to have the report at the inspection in case anything needs to be gone over with you visually. You can't beat having that knowledge fresh in your mind at the time of the inspection.

Real Estate Professionals

If you go to the website of the American Society of Home Inspectors, or any of the nationally recognized associations mentioned above, they will provide you with a list of inspectors in your area that are full members. It makes it easy: give the list to your client and let them interview protential home inspectors. Some of you are confortable with providing your client with one or two inspectors, which is great as well. Remember, your referrals and knowledge about home inspections is a direct reflection on your professionalism. A home inspection is just one part, but an important part, of the home inspection profess. Be as involved in helping your clients find a qualified home inspector as you feel comfortable doing.

If any buyers, sellers or real estate professionals have any questions or comments concerning these suggestions, I would warmly welcome them.

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Kurt Nickelsen, www.nickelsenhomeinspections, Vancouver Washington