Thread: Canceled Inspection

First for me:
In the AM I spent some time on the phone with a prospective client and set up an inspection. Get call in PM from client stating that his agent said an inspection was done earlier for a buyer and the deal didn't go through. The agent said she had the report and my client could just use that instead having to pay for his own report. Inspection canceled.

I believe the agent is or works in the same office as the listing agent. If I'm right, it's the same agency and office that I earned my "Deal Killer" badge.

I emailed the now ex-client to tell him that the agent had just done something unethical and dumb. I recommended that he should have a buyer's agent not associated in anyway with the listing agent's brokerage. It wouldn't cost him anything and he was less likely to be victimized by anyone walking on or over the ethics line.

I added that I really didn't care about the cancellation but I was concerned that he have the best professional representation. He did sound very Marine on the phone. Our service people give enough without having a ignorant or shady real estate agent taking advantage of them.

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You are very lucky if this is the first time this has happened to you.

When I learn that my clients have decided to NOT buy the house I inspected, I immediately take the report off the web.
I have found that a lot of agents pull the report up to look at it, but do not save it to their computer. I get lots of calls to re-upload a report.

Once in a while I will get a call from a prospective client, or a listing agent about a report I did recently and want: 1. a reduced fee to "re-inspect" it, 2. permission to give the report to the new buyers, or 3. want to ask a bunch of questions about the report.

In each case I tell them they have no rights to the report, and that if they use it, I consider it "theft". I then explain to them that I do an inspection for a client, and the report is ONLY for THAT client, for THAT transaction. I also let them know that I do inspections for a living. This is how I feed my family. To use the product of my work is like taking money out of pocket.

Some get it, most do not.

Originally Posted by Jack Feldmann

You are very lucky if this is the first time this has happened to you.

When I learn that my clients have decided to NOT buy the house I inspected, I immediately take the report off the web.
I have found that a lot of agents pull the report up to look at it, but do not save it to their computer. I get lots of calls to re-upload a report.

Once in a while I will get a call from a prospective client, or a listing agent about a report I did recently and want: 1. a reduced fee to "re-inspect" it, 2. permission to give the report to the new buyers, or 3. want to ask a bunch of questions about the report.

In each case I tell them they have no rights to the report, and that if they use it, I consider it "theft". I then explain to them that I do an inspection for a client, and the report is ONLY for THAT client, for THAT transaction. I also let them know that I do inspections for a living. This is how I feed my family. To use the product of my work is like taking money out of pocket.

Some get it, most do not.

Jack, they all get it. They just do not care in the slightest. My mother raised 5 boys by herself. None of the five boys have the ability to not care or act brain dead or try to pull one over on anyone. Some people have the fine art of going thru life not caring about anyone but themselves. "How can I get one over on him" "If he finds out...who cares? I don't know the fool" G" "Gee, what's up with that? He already inspected the home and now he wants to get paid for doing it again....what's up with that"

I could have been a millionaire several times over Jack and I have made some decent money in my life but not one cent was from walking over anyone.

If you read my other post you will see my monthly Realtor rant. I believe they should lose their license if they get caught referring any home inspector or association. Temporarily the first time and permanently the second time. We would all make more per inspection for one. The Realtors would not be able to dictate who got what inspection or how much. And a whole lot of other ethics reasons and this thread being one of them.

Ted,

I agree with you completely. Agents should be held to the same as Inspectors are, when it comes to the ethics side. I have a realtor that continues to say, "I have my home inspector and I use him exclusively". This seams like she crosses the line of referrals.

The thing with agents is they do way fewer individual transactions than most HIs so the liability thing is diluted compared to us.

What's a good year for an agent? 20 transactions? These days 10?

How about an HI? A few hundred?

We just have more exposure, have been dragged through mud more and just inherently care more about being sued.

I'm not justifying their behavior.... just throwing some statistics in to help make it more clear. The bottom line is a lot of agents can go for years acting in a totally unethical manner and never get burned. And, if/when they do. The E/O provided by the big boss will step in and take most of the hit.

Many of the agents I've observed doing shady stuff don't even think they're acting incorrectly or wrong. At least that's my observation for the short time I know them

I used to have a similar problem with my WDIIRs. Realtors would use the same one for a new client and just tell me the deal fell through for the client I did the inspection for. I started puting in the comment section that "This report is void after 30 days". Now when they get a new client there is no question that a new inspection is needed. Some have asked me to just change the date but I tell them we are dealing with life science here and it changes so a new inspection is needed. I have had one realtor to quit using me in favor of another PCO who charges $35.00. I couldn't even go out and shake somebodys hand for $35.00. Anyway with the drop in business I am now concentrating on Bedbug consultations with Hotels and Apartment complexes.

My theory is If you didn't pay for it you don't get it.

For the realtors who want to use the same report over again should be asked when it comes to sell the house are they going to sell it for free too? if ever they say yes then the inspection would be reused for free too. but they need to wake up and spread the wealth and not keep it all for themselves. they will get a rep and if it is not a good one guess what it will hurt them in the long run. Karma is not something to mess with

Hm, Bad idea in my opinion.

I would have emailed/called the buyer and explained what I was told, and
asked if the buyer was sure he didn't need my services.

Right There - was where you should he not said another word.
The Real Estate community is a very small town.
95% of all Realtors are unethical to some degree.

Get used to it - perform quality, honest inspections, and keep your
opinions to yourself.

Take my word for it - I've been there................

mf.

Did an inspection two weeks ago. 9000 feet 900 dollars. Deal fell through. New buyer calls me up and asks if they can have the report. I said sure for 250 dollars I will go out and check a few things. Calls backs says they don't want it. So I check to see if anyone is looking at the report, via email Id. Low and behold the f ing bank gave it to them. That's a first for me.

Originally Posted by mathew stouffer

Did an inspection two weeks ago. 9000 feet 900 dollars. Deal fell through. New buyer calls me up and asks if they can have the report. I said sure for 250 dollars I will go out and check a few things. Calls backs says they don't want it. So I check to see if anyone is looking at the report, via email Id. Low and behold the f ing bank gave it to them. That's a first for me.

Someone at the bank more than likely has a few folks on a string to call if certain perameters are met with properties. Someone comes in looking to finance a home and the stipulation is to let them see the inspection report. The banker sees that it appears to be a pretty good deal for the money and has the inspection report in hand and the original buyer backs out. He calls a couple guys and says "Oh what a deal I have for you" He calls the guy in, they go over the report and the price of the home and then the guy makes an appointment to visit the property. Te mortgage guy gets his commission as well as an envelope tucked into his back pocket and everyone is happy with the exception of Matt that should have been paid for the report.

Here is my 3rd party disclaimer:
I would call the Bank and demand they get your report back
or pay your fee...............

The inspection report content is the intellectual property of Home Inspection
Service of the West. A copy of which is provided to the buyer as part of the home
inspection service. No third party, what so ever, may utilize, duplicate, or transfer,
this report without the express written permission of Home Inspection Service of
the West. The report may be used as a transaction tool, where distributed with
the buyers knowledge, by the inspector to the Buyers and Listing Agents, for use
only during the escrow period and must be discarded by all third parties
subsequent to the closing of escrow.

Contrary to industry norms, no Real Estate Agent, their Office Manager or Broker
is permitted to retain a copy of this report, for future use, without express written
permission of Home Inspection Service of the West.

mf

I have heard complaints about "wandering reports" seemingly forever.
THERE ISN'T A DAMNED THING YOU CAN DO ABOUT IT. You will just lose lots of time and sleep over it when it happens. You should assume that it will get passed on / around and move on with your life accordingly. You might consider adding this to your reports -- "Secondary readers of this report should be aware that conditions may have changed since the time this report was furnished to the original client - Be aware that the inspector is not responsible to other parties"

I deleted the report. It is provided by a "cloud" based program

Originally Posted by matt faust

Here is my 3rd party disclaimer:
... Snipped ...
Contrary to industry norms, no Real Estate Agent, their Office Manager or Broker
is permitted to retain a copy of this report, for future use, without express written
permission of Home Inspection Service of the West.
mf

I have also run across something else that is out of the norm. Lenders demanding a copy of any inspection report. This has created a problem in various government backed loan programs like FHA, VA, and Virginia's Rural Development program. Someone in the chain, whether an underwriter or processor, is demanding that "ANYTHING" in the report that is classified as "Repair or Replacement" MUST be repaired, reinspected, and certified as being repaired in order to have the loan approved. No matter how small or insignificant an issue to the general condition of the house. Example: The bottom of the casing of a front door appears to have water related damage requiring repair by a qualified person. Picture in report shows the bottom of a piece of brick molding where water has wicked up the end grain and allowed rot to start.

Does it require repair? Yes. Does it make the house unsafe? No. Would it affect the value of the house? Not as a single issue.

I think I will make it a practice to ask clients if they are applying for a FHA, VA, or RDA loan and if they are, telling them that anything that calls for repair, no matter how insignificant, may be have to be corrected, reinspected, certified, etc. before their loan is approved. I may add that as an addendum to the standard inspection agreement.

Originally Posted by Stuart Brooks

I have also run across something else that is out of the norm. Lenders demanding a copy of any inspection report. This has created a problem in various government backed loan programs like FHA, VA, and Virginia's Rural Development program. Someone in the chain, whether an underwriter or processor, is demanding that "ANYTHING" in the report that is classified as "Repair or Replacement" MUST be repaired, reinspected, and certified as being repaired in order to have the loan approved. No matter how small or insignificant an issue to the general condition of the house. Example: The bottom of the casing of a front door appears to have water related damage requiring repair by a qualified person. Picture in report shows the bottom of a piece of brick molding where water has wicked up the end grain and allowed rot to start.

Does it require repair? Yes. Does it make the house unsafe? No. Would it affect the value of the house? Not as a single issue.

I think I will make it a practice to ask clients if they are applying for a FHA, VA, or RDA loan and if they are, telling them that anything that calls for repair, no matter how insignificant, may be have to be corrected, reinspected, certified, etc. before their loan is approved. I may add that as an addendum to the standard inspection agreement.

Wood rot, termites, carpenter ants and the such all require repair before the FHA loan oes thru. As far as other major goodies such as foundation issues, roof repair, electric hazards, water leaks, FHA will either want them fixed or at the list money set aside for those repairs after the closing.

Now that I said that it also depends on the FHA loan that the buyers are getting.. I think a 203 or 203 a or what ever wants it all fixed and of course all the termites and such gone before closing. I have seen some FHA loans where they do not even ask for a termite inspection to be done.

So, in regards to "do repairs have to be done when they are written up by a home inspector?" Sometimes never, sometimes some of the items and sometimes all the items. What we do write does matter in many cases.

VA loans are or should I say can be more demanding. Every new home needs a termite inspection. I am talking fresh out of the ground. In the past couple months we have done an endless amount of VA loans requiring termite inspections.

As far as Texas goes the inspection report if ever in hand of the listing agent must disclose its findings to the next agent that comes along with a buyer. That in itself has cut home inspections down because the entire report gets passed of for disclosure. The next folks in line are using it. The only time they do not is if a short amount of time has gone buy then they will request a new home inspection.