Mortgage companies require many things when you get a mortgage, but one thing they don’t require is the home inspection. This part of the process is optional; however, it’s not something you should risk. The inspection is something you’ll want to have done for your own protection. If you don’t pay for one, you run several risks, many of which are financial.
Lose Your Escrow Deposit Without a Home Inspection
One protection of the home inspection is that you won’t lose your escrow deposit assuming you have the right contingency on your contract. Your lawyer should help you put the right contingencies into place. This particular one lets you back out of the home purchase if the inspection comes back with anything you do not like.
Let’s say for example that the inspection came back stating that there is a crack in the foundation. This is a major structural problem that would cost you thousands of dollars to rectify. If you are not comfortable taking on a responsibility like that, you could back out of the purchase and still get your escrow money back.
If you did not have the contingency, however, it would not be possible to back out of the contract. You would not have professional proof of the issues with the home which means you could not back out of the contract. If you did back out, you would lose your escrow deposit.
The Home Could Cost More
A big part of the home inspection is the financial protection it provides. If you buy a home without knowing what might be wrong with it, it could cost you a lot more down the road. If the damages cause immediate danger or need immediate repair, it could be much more costly to buy the home. Suddenly the cost of buying the home could greatly increase.
Let’s say a home inspector would be able to tell that there was a leak in the basement that caused mold growth. But, because you skipped the inspection you didn’t know this. You bought the home anyways. A month or two down the road, though, you discover the mold damage and have to hire contractors to remove the mold and fix the damage it caused. The cost could be very high, making it unaffordable to own the home right off the bat.
Lose Out on Negotiating Opportunities
Negotiating with a seller takes a lot of work. Some sellers are willing to negotiate because they are motivated sellers. Others are stubborn about the price they want for their homes and will not budge. If there’s a reason for them to budge, though, they might.
That reason could be that there is something wrong with the home. Without a home inspection, you don’t have any reason to tell the seller there is an issue with their home. With a written report, though, you might be able to go back to the seller and try to get a lower sales price. If they know something is wrong, they may be willing to either:
- Lower the sales price
- Fix the issues
- Give you a credit to do the repairs yourself
Once an inspector writes a report stating there is an issue with the home, the seller must legally disclose this to any future buyers. This is why sellers would be more motivated to negotiate if they know something is wrong with the home.
Safety Issues Arise
Finally, not having a home inspection could cause safety issues for you and your family. Unless you are a professional, it’s difficult to tell if a home is safe beyond what you can see. Wouldn’t you rather have someone let you know the home is safe and sound? It’s only a few hundred dollars for the inspection, yet it can save you a lot of heartache and money down the road.
We don’t recommend skipping the home inspection when you buy a home. Inspectors offer this service for a reason. Whether your reason is financial or for your own well-being, it’s an important step that you should not skip if you want your home purchase to be a successful one.