Monday, September 28, 2009

Home inspections as a remedy for real estate fraud.

I have written about the increased risk of misrepresentation by sellers of real estate in the current economic climate. As housing prices stagnate, sellers will resort increasingly to fraud in order to rescue their expected gains from the sale of their properties.

In order to protect themselves, buyers must increasingly use home inspectors in order to discover hidden defects in the houses they would purchase. A home inspection can reveal structural or other defects that might cost the buyer dearly once the transaction is complete.

But home inspections come with limitations. The home inspector will not look in obstructed areas of the house during his inspection. Sellers know this limitation and will find ways to obscure the various defects. Inspectors are not aggressive about seeking out defects or questioning sellers. Home inspections must be performed and presented to the seller within a certain time period. Sellers may dispute the results of a home inspection and attempt to retain the buyer's deposit if the buyer backs out of a deal because of a negative inspection report.

There are ways for a buyer to deal with all of these issues - ways that I will discuss in later posts.
update - home inspector organizations.

1 comment:

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