So, you have gone through the mortgage loan pre-approval process, found a property that you like, and got an offer to purchase accepted. What’s next?
For one, you’ll need to get various inspections done to ensure the state of your potential new property is up to standard. The need for them will vary from property to property so be sure to ask your realtor. For now, here is a brief summary of some of the important ones:
- Appraisal Inspection – If you are getting a mortgage loan, you will most likely need an appraisal. A licensed appraiser uses comparable properties to calculate the property’s value and is what the lender uses to determine your Loan-to-Value. Appraisers will also make note of certain health and safety standards such as the presence of carbon monoxide detectors, straps on the water heater, and if there appear to be any wood-destroying organisms or structural damage. This is the only mortgage-related inspection that also happens to be required. Sometimes, the subject property may qualify for an appraisal waiver.
- General Home Inspection – This will cover the overall condition of the property. The inspector will check everything from the foundation to the roof. They check basic plumbing and electrical to make sure all major appliances are working properly. They also check the HVAC and any additional structural components on the property.
- Structural Inspection – If any red flags come up on the General Home Inspection that may be indicative of a structural issue like a crack in the foundation or the stability of the walls, a structural inspection is a great way to get to the root of the issue.
- Pest Inspection – This checks for pests such as termites and other wood-destroying organisms. This will also outline the work needed to repair any damage to the property caused by wood-destroying pests (this is required if you are getting a VA loan).
- Mold Inspection – This looks for the presence of mold in the property. Mold can be present without any obvious signs so this can be an especially good idea for those with allergies or respiratory issues.
- Plumbing Inspection – This is a review of the plumbing on the property including supply lines and sewage lines. Plumbing issues can lead to extensive water damage to your property so knowing where your plumbing stands can help avoid major headaches in the future.
- Chimney Inspection – This is a visual inspection of the fireplace to check for damages, obstructions, or creosote buildup as well as any sweeping that may be required. Creosote is one of the most common causes of chimney fires that can cause a great deal of structural damage.
- Lead Paint Inspection – This will check if the property contains lead-based paint. If your house was built before 1978, this inspection is highly recommended.
- Well and Septic Inspection – This only applies to properties that have a well and septic system. If your property does, this inspection will confirm whether or not the system is in good working condition and if it meets local health and safety standards (this is very uncommon in California).
- Radon Inspection – This looks for the presence of radon gas in your home which can be hazardous to your health.
Ideally, you would get all these inspections done but in actuality, they are costly and not always needed. The purpose of these inspections is to learn more about the underlying condition of the property and to better make decisions around the purchase including potential negotiations that would require firm documentation to support.
If you have any questions on how these inspections may affect your financing or how seller credits and price reductions will affect your home loan, give us a call at (760) 930-0569. Our Loan Originators are available to assist in answering any questions that you may have.