Thread: Is a signed contract a pre-requisite to an inspection?

I was contacted today by a home buyer calling from Alaska wanting an inspection on a home they had viewed in Oklahoma. They had toured homes using a local real estate agent before returning to Alaska. They had found one they liked and contacted me for an inspection. After speaking with the buyer and getting all the information, they proceeded to pay with a credit card via my website, so I have the money in hand at this point. When I contacted both the buying agent and the selling agent, they both wanted to wait until they had a signed contract in hand before providing me access to the property.

My question is....Is this normal? First time this has ever happened to me.

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Originally Posted by Dub Smith

I was contacted today by a home buyer calling from Alaska wanting an inspection on a home they had viewed in Oklahoma. They had toured homes using a local real estate agent before returning to Alaska. They had found one they liked and contacted me for an inspection. After speaking with the buyer and getting all the information, they proceeded to pay with a credit card via my website, so I have the money in hand at this point. When I contacted both the buying agent and the selling agent, they both wanted to wait until they had a signed contract in hand before providing me access to the property.

My question is....Is this normal? First time this has ever happened to me.

Probably not a requirement, but certainly is a good idea. I rarely inspect a home where there isn't a signed purchase agreement.

Around here, the buyer's agent tries to protect the interests of the buyer. If someone else gets into contract other than your client, your client could just be wasting his/her money on an inspection and report.

The listing agent has a responsibility to the seller and could be liable if someone goes into the house without a contract. In CA, the purchase contract specifically allows for inspections. OK might be different.

Thank Gunner, I haven't given a thought to the legal precedent involved. Makes all kinds of sense now. Appreciate the insight.

NC contract allows for inspections also.

Originally Posted by Dub Smith

I was contacted today by a home buyer calling from Alaska wanting an inspection on a home they had viewed in Oklahoma. They had toured homes using a local real estate agent before returning to Alaska. They had found one they liked and contacted me for an inspection. After speaking with the buyer and getting all the information, they proceeded to pay with a credit card via my website, so I have the money in hand at this point. When I contacted both the buying agent and the selling agent, they both wanted to wait until they had a signed contract in hand before providing me access to the property.

My question is....Is this normal? First time this has ever happened to me.

This is actually pretty funny. You have been paid for an inspection for a particular proerty. The contract as everyone here knows is for you. Not for them. It does them no good at all. It protects you from everything and them about nothing.

I have never once been *asked* about a contract in the 10 plus years full time and 20 plus years part time inspecting which makes for untold inspections....not once.

If you do not use a contract get a good one on line. They are everywhere and they all lean mostly toward the inspector. Certainly not the buyer and especially not toward the Realtor. I say send away. Can't hurt you at all.

I agree Ted, I NEVER inspect without a signed Inspection Agreement and a signed Contract, that point is stated clearly on my website and the contract I use uses verbiage that states that in the absence of the client, payment constitutes acceptance of the terms of the contract. However, in this case, the Buying agent and Selling agent was referring to the Purchase Contract between the Buyer and the Seller. Gunnar made an excellent point on the legal ramifications in an earlier post....something I hadn't thought of.

Originally Posted by Ted Menelly

This is actually pretty funny. You have been paid for an inspection for a particular proerty. The contract as everyone here knows is for you. Not for them. It does them no good at all. It protects you from everything and them about nothing.

I have never once been *asked* about a contract in the 10 plus years full time and 20 plus years part time inspecting which makes for untold inspections....not once.

If you do not use a contract get a good one on line. They are everywhere and they all lean mostly toward the inspector. Certainly not the buyer and especially not toward the Realtor. I say send away. Can't hurt you at all.

If I understand properly, they are talking about a contract to purchase the property, NOT an inspection agreement (contract)
I have come up on this a few times and it all depends on what the seller allows. I have had the seller refuse to allow access until the executed contract is in place and lately especially banks and auction companies allow inspections prior to any contract.

No Realtor in this area is going to let a home inspection be booked till the seller and the buyer have a agreed upon sales contract.

Till one is present, there is no reason for an inspection to be performed.

rick

Originally Posted by Jim Luttrall

If I understand properly, they are talking about a contract to purchase the property, NOT an inspection agreement (contract)
I have come up on this a few times and it all depends on what the seller allows. I have had the seller refuse to allow access until the executed contract is in place and lately especially banks and auction companies allow inspections prior to any contract.

I guess one side of the brain was not functioning. I was rehabbing a couple websites all day and clicked every now and then on this site. A little attention deficit disorder going on I guess.

I hate being trapped in the office all day. That is why I have always had my own business. Gotta be out and among the rest of the living and breathing folks. The desk and chair and computer thing is not on my like to do list. Gotta mix it up.

I have only done a handful of inspections in all time that did not have a signed purchase agreement.

Dub,

Not knowing real estate contract statutes in OK I can't say whether the buyer can successfully request a "pre-offer" inspection; however, it is always in the buyer's best interest to have one. Why would a buyer wish to become contractually obligated to purchase, under the contractual terms, a property when they don't fully know the condition of the structure and its systems?
I have paid for appraisals on potential purchases prior to making an offer and decided not to make an offer. Did I waste money? Not in my view. I saved money in knowing that the value of the property wasn't close to what was being asked. If the gap is too wide there is no reason to pursue a bid. Of course, this was nearly 10 years ago when real estate was healthier and "crazy" bids were not even entertained by sellers.
I've performed many inspections for buyers prior to making a offer over the last 20 years and it has always put the buyer/client in a better position from which to bid. Most agents would prefer not to allow that to happen, of course, They need an offer in writing in order to lock the buyer into some terms.
In NC, performing inspections prior to an offer is Option 2 and will cost the potential buyer a relatively small, non-refundable fee for the right to "investigate" the conditions of the property. You shouldn't have to purchase the right but "there it is".

As for performing a Home Inspection prior to having a signed agreement....NO WAY in H***. Most of my clients, though not all, sign my agreement at the inspection site whenever they arrive. If I have begun the inspection prior to their arrival I typically stop, meet and greet, and get signatures AND PAYMENT at that time; without exception. No signed agreement, no report, no exceptions.

Just hold the money and wait for the contract to come through. If it doesn't, refund the money.

If your client is out of state when you do the inspection, your job(mainly the report) will need to be done exceptionally well. If they're are not there to experience it with you, the written report will be extremely important to protecting both you and your client.

Do not let the agents push you around; not even the slightest bit. Shove them back over to their side of the fence if need be.

I always get an agreement in the hands of my client prior to the inspections. We deal with a lot of military and folks who travel. Occasionally that don't have access to a fax machine / printer etc. and we have the inspection scheduled. At minimum we get an email that states "they have reviewed our agreement and agree to all the terms."

Regarding the property under contract, I have done a number of pre-contract walk-throughs with clients. Usually they want to know how bad the EIFS or LP siding are or is some other issue going to tilt the tables on the property.

//Rick

No contract signed = no inspection.
What fool would not protect themselves .
In Illinois it is required and I would have one signed even if it was not.

Both agents are in sales. They both want to have the buyer make some kind of commitment to purchase. That is basic sales 101, during a sales presentation you work the buyer to make commitments right up till you ask for the sale. The agents want a contract to work the buyer and seller towards the finial sale (where they get paid). It is all about making the sale (for the agent).

Doing a HI prior to making an offer helps the buyer make an informed offer, money well spent. If the property goes into contract (to someone else) before your client gets their offer in, that's just part of the buying game.

Can not think that there could be any legal reason to prevent the inspection. Only need the seller to authorize and for you to get your inspection contract from buyer.

Perhaps the buyers form Alaska was unaware of the procedures, or their agent failed to inform them of the process.

What really sucks is to have an Inspection canceled because the loan fell through

Colorado Springs - Home Inspections, Commercial Inspections, Radon Inspections, Mold Inspections

Tom,
What procedures? Sure we usually see HI listed in contract. But that is not etched in stone. If a buyer wants a HI prior to making an offer why not?

Hey everyone, just an update to my first initial post. The buyers from Alaska proceeded to sign a purchase contract with a contingency on an acceptable Home Inspection. The inspection was completed with about a 3 page summary of issues found. These issues have been addressed and corrected by the seller with a re-negotiated purchase price that both parties have agreed too. Well, I guess all's well that end's well!! Thanks for everyone's contributions, this is where this site is truly beneficial to everyone who has a question or concern.