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  1. #1
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    Default Certified pre-owned homes

    Just wanted to see if any of you are involved in certified pre-owned home programs where you perform a listing inspection and the home is labeled as a Certified Pre-Owned Home. Are your reports being given to the buyers in leu of them getting their own inspector? Are you guarantying anything since it is called certified? Are you using different contracts than normal? Is it catching on? Pretty slow right now and considering marketing this type of inspection. I have done some listing inspections, but wondered if the fact that is being billed as Certified changes things much.

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  2. #2
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    Default Re: Certified pre-owned homes

    It is always slow at this time of the year, it will pick up in a couple of months.
    I would not even entertain an idea of "Certifying" a home as being OK.

    NACHI started a program like this and Nick says that the inspector has no liability as the home owner is the one that is Certifying the home! I'm sure Nick will go to court and tell the judge and jury this as well!

    Anyway, I don't see it as a way to increase business. When you think about it the buyer if they have any sense will get their own inspection. Now from the standpoint of prepping a home to put on the market, a pre-listing inspection is helpful.

    Scott Patterson, ACI
    Spring Hill, TN
    www.traceinspections.com

  3. #3
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    Default Re: Certified pre-owned homes

    In some areas pre-listing inspections are the norm... my area isn't one of those so I don't know a whole lot about it. I do them from time to time but it's a relatively small part of my business.

    This has been the marketing ploy of choice amongst inspectors in my area over the last couple of years. I feel any advertising I did pushing listing inspections would be lost in the crowd.

    Every year about this time I get all fired up and try to come up with new ways to get busy. Then within a few weeks I'm running my tail off again and forget all about it.

    I think in the end the best advertising is word of mouth between past clients, real estate agents, etc.


  4. #4
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    Default Re: Certified pre-owned homes

    Same here, I always sit around thinking of ways to get more work and then about mid Feb, I get covered up. However, I just had my worst Dec in fours years and I have only been doing this for six going on seven years. Everyone keeps talking the gloom and doom and it gets a little scary sometimes.

    I also agree that certifying a home sounds a little risky. I think I will stick to the advantages of knowing what your in for rather than certifying that the house is move in ready, what ever that means. I am confident in my ability to find the problems with the house so I don't mind doing listing inspections, I was just wondering others thoughts on the subject. I can see people getting the wrong idea about a home inspector certifying a home. To me it sounds like you are saying that you inspected the home and there are no problems, or that the problems you found were properly repaired.

    If it weren't for lawyers, we would never need them.

  5. #5
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    Default Re: Certified pre-owned homes

    Over the years I've had several of my regular agents contact me about doing a listing inspection on some of their higher end properties and they'd use it as a marketing tool. Kind of a 'signature' listing. I'd do a few of these for each agent and then never hear about the concept again..... in every case. It just never takes off. I think buyers are just too skeptical. I know I would be.

    Don't worry, you're not alone in the biz being down.... I just had my worst month in the last 5 years. It will come back..... and when it does a lot of the competition will have moved on to something else.


  6. #6
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    Default Re: Certified pre-owned homes

    Everytime I hear the comment about something being certified or warrantied I always picture Chris Farley in that movie (forget the name) where he has inherited his dad auto parts business. He has a great line in that movie about things being certified thats puts it into perspective.

    rick


  7. #7
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    Talking Re: Certified pre-owned homes

    Personally, I see nothing wrong with certifying a home as preowned.

    Last edited by Eric Barker; 01-04-2008 at 07:36 PM. Reason: typo
    Eric Barker, ACI
    Lake Barrington, IL

  8. #8
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    Default Re: Certified pre-owned homes

    Quote Originally Posted by Eric Barker View Post
    Personally, I see nothing wrong with certifying a home as preowned.
    Yep!

    She's a two hole're.


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  9. #9
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    Default Re: Certified pre-owned homes

    What happens if you miss something that the buyers inspector picks up. You can bet your phone will be ringing.

    Bill Siegel
    Florida Home Inspection Team Inc.

  10. #10
    Richard Stanley's Avatar
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    Default Re: Certified pre-owned homes

    In a sinister sort of way, it kinda fun to go behind those certifying guys. The seller was going to contact their inspector.....


  11. #11
    Richard Rushing's Avatar
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    Default Re: Certified pre-owned homes

    It was Tommy boy....


  12. #12
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    Default Re: Certified pre-owned homes

    Quote Originally Posted by Eric Barker View Post
    Personally, I see nothing wrong with certifying a home as preowned.
    Yep ...

    Charge $175 to walk up and ask: "Are you the sellers?", they reply "Yes.", you ask "So, then, you own this home?", they reply "Yes.", you say "Thank you, I can now certify this home as a pre-owned to the buyers."

    Is this a great country or what?



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  13. #13
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    Default Re: Certified pre-owned homes

    i have three agents that i do pre listing inspections for----i take alook at the four basic majors for them {thats all they want signed in the agreement----electricity--plumbing{looking for leaks--sump pump operation-water heater}--furnace and roof--and if time is left over will pop my head in the attic to make sure the crew who put the new roof on didn't short stop the exhausts fans from the bathrooms and plumbing vents and leave them hanging in the attic----that is the new trick around here
    i give them an abbreviated report with just summary sheet WITH PICTURES that states--ITEMS NEEDING ATTENTION----it's a one hour +/- inspection----$200----some agents are trustable----i've done about 80 of this type----find nothing wrong with it


  14. #14
    Andy Cox's Avatar
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    Default Re: Certified pre-owned homes

    Quote Originally Posted by william siegel View Post
    What happens if you miss something that the buyers inspector picks up. You can bet your phone will be ringing.
    I just don't see the liability here for the pre-list inspector. Sure, your reputation will take a beating - but your legal liability should be nothing, as long as you recommend that the buyer have their own inspection. If you do miss something on the pre-list inspection, and it is caught by the buyer's inspector, the worst you should be hit is to refund the seller's fees. If it's not caught, the buyer's inspector should be the responsible party.


  15. #15
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    Default Re: Certified pre-owned homes

    If I remember correctly, there was a case in CA that ruled on a similar situation and ruled against the HI. Even if specifically disclaimed, the report is out there and parties other than you client have a standing to sue you
    Glad I'm Not in Lawyer land.

    Jim Luttrall
    www.MrInspector.net
    Dallas, Texas

  16. #16
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    Default Re: Certified pre-owned homes

    Pre-listing inspections are also extremely rare around here (I have had requests for a few over the last 4 years), though I have heard that they are much more common in other areas. One Realtor friend talked to me a year or 2 ago about doing a pre-listing program, wanting to set up a "no haggle price" program to reduce repetitive negotiations (though that conversation never went anywhere).

    By the way, I get a bit nervous about calling it a "Pre-CERTIFIED" inspection. That carries some odd conotations.

    Several Realtors around here are now offereing a year home warranty as an attempt to get a listing sold. A pre-listing inspection is similar in some ways. It is essentially another markeging tool for Realtors. My pre-listing program offers sign riders and brochures for the potential buyers, and even a short video tapes for the seller about staging a home. As part of a pre-listing inspection for the Seller, I also offer a heavily discounted price for a re-inspection for the Buyer (see the Notice to Buyers below). (yeah, its a marketing scheme, but I don't sell used cars or Brooklyn bridges).

    A neighbor requested a pre-listing inspection last fall (I actually tried to talk him out of it, and suggested a 1-yr home warrany instead, but he wanted one so I did it). I found a few things they hadn't fixed. In any case, the Buyer that eventually bought the house told his Realtor that he bought the house 'as-is' in part because he felt more comfortable with the purchase because of the home inspection report. So it can work, though I don't suspect it will generate a lot of extra business. Basically, I market pre-listing inspections just as another way to get my name out there just as with any marketing material I send out.

    As far as Liabilty goes, if you don't feel confident about missing something, then my attitude is that you shouldn't be doing any home inspections anyway. (This of course is from an inspector that has missed a few things over time, and learned from it the hard way.) Your inspection agreement should cover you for pre-listing inspections about the same as a buyers inspection (for whatever that is worth!!). Note: I also carry E&O even though its not required by my state (actually, nothing is really required by my state, even for builders). But E&O is a completely different topic.

    The inspection agreement I use specifically states that a home inspection report "...is not intended to benefit any person not a party to this Agreement...". Therefore, nothing stops the Seller from giving my report to the Buyer, but my Aggreement states that any liabilty is non-transferrable.

    Here is a Statement to the Buyer that I will include in any future pre-listing inspections:
    "Notice to Buyers: The Seller’s inspection report reflects the condition of the home at the time of the inspection. Although we do our best to ensure the inspection report accurately represents the conditions of the home at the time of the inspection, property conditions can and do change with time. Therefore, the Buyer should have a Buyer’s inspection performed prior to making a purchase decision. Unless <my company name> performs the Buyer’s inspection, <my company name> cannot be liable for the Buyer’s reliance upon any information contained with the Seller’s inspection report."

    That's my two cents. But I am certainly eager to hear other opinons from someone that has done a few pre-inspections, and especially if they have ever been bitten by doing one.


  17. #17
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    Default Re: Certified pre-owned homes

    THAT WAS A DIMES WORTH ON YOUR TWO CENTS---i agree- as i said i have three agents i do pre listing inspections for--and we trust and like each other and that is important---i do the four majors---plus i give them advice on what to do to help that buyer inspection coming up--like get rid of that mouse trap and rat poison by the not operating sump pump---seal those driveway cracks--clean those window sills----i get about 20 of these listings from theses agents and half the time the seller hires me to do the home they buy after selling them----building a trusting and workable union with your real estate agent is gold---i know mouse trap and mice--shouldn't that be disclosed----there are more mice in this world then humans and they are in most homes where cats dont live


  18. #18
    Andy Cox's Avatar
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    Default Re: Certified pre-owned homes

    Terry,
    That's a great disclaimer for the seller's inspection. I have something similar, but not as well put together.

    I have two levels of a seller's inspection - it depends on the seller's needs... I can do a quick inspection, like a "4point" inspection, roof, HVAC, Electric service panel, and plumbing, or I can do a regular inspection. Many of the seller's inspections I do, the owner already has knowledge of the cosmetic stuff, doors and windows that stick, etc. I focus more on the stuff the homeowner doesn't know about, or has forgotten. In one house, the owner had installed batts of insulation upside-down. In another, the GFCI's didn't work.
    It was said elsewhere, the pre-listing or seller's inspection is for the marketing... it brings up those things the seller will need to take care of. But, I've also had more than one seller say that it brought them peace of mind - they can rest easy that there were no major problems - nobody wants to hear about those from the buyer's inspector!!!


  19. #19
    Mark Mustola's Avatar
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    Default Re: Certified pre-owned homes

    This NACHI program is probably the worst idea I have ever heard of.

    Of cource the inspector would have a great deal of liability. If a buyer goes up to a house and sees a sign that says the house is certified and the seller gives them your report to prove it, the buyer will assume the the inspector has signed off on everything. I understand that NACHI says the inspector has no liability because it's the seller who is claiming that everything was repaired properly. No matter what contracts or disclaimers are in place if a problem is discovered after the buyer moves in you can bet he will sue both the inspector and the seller. The inspector will have to spend money for legal fees to prove he has no liaility.

    What if the seller does properly fix all reported defects but the inspector missed some. Having your name and report tied to something that is sold as certified is raising the expectation that the client has regarding your inspection. This is just crazy.

    When we inspect for a buyer we are not certifing and or claiming that the house is defect free. We are just using our experience and judgement to find as much wrong with the house as we can to help the buyer reduce their risk not completely eliminate their risks. That is why we all use inspection agreements.

    I know the there are some fine NACHI inspectors out there but in my area all the NACHI inspectors are very inexpeirenced. Many seasoned inspectors would have a field day coming in after them to do an inspection on a house that was labeled certified. I just can't see why an inspector would want to add that much risk and liability to their work


  20. #20
    David Nice's Avatar
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    Default Re: Certified pre-owned homes

    Quote Originally Posted by Mark Mustola View Post
    This NACHI program is probably the worst idea I have ever heard of.

    I know the there are some fine NACHI inspectors out there but in my area all the NACHI inspectors are very inexpeirenced. Many seasoned inspectors would have a field day coming in after them to do an inspection on a house that was labeled certified. I just can't see why an inspector would want to add that much risk and liability to their work
    An inspector acquires no more liability using the NACHI Program than any other inspector doing pre-listing inspections, I have also heard plenty of noise about inspectors coming in after a pre-listing inspection and demanding that older homes "must" be brought up to code, in areas that they clearly do not and citing things as wrong that there is already photographic evidence that those things are fine. I haven't heard yet of one being sued for making stuff up, but I am sure it is coming.

    Also, if you were to look into the NACHI inspectors in your area you would find plenty of them with at least 3-5+ years inspecting experience, at least one with a Ph.D some with 15+ years experience in engineering and at least one that was a builder for over 25 years.

    Why you would suggest that in your area "all the NACHI inspectors" are very inexperienced is beyond me? I would even bet that most of them learned how to spell in under 10 years.


  21. #21
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    Default Re: Certified pre-owned homes

    A new Canadian version

    http://certifiedpreownedhomes.ca/

    The value of experience is not in seeing much, but in seeing wisely.

  22. #22
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    Default Re: Certified pre-owned homes

    Mark....I think you've just been."SLAMMED"!

    An ounce of prevention is worth a pound of cure
    Jubilee Home Inspections

  23. #23
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    Default Re: Certified pre-owned homes

    Suggest checking with your insurer. Will you be covered, or does this bring on higher risk?


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