Find Your Answers to Home Inspection Service and Title Insurance
Frequently Asked Questions on Home Inspections
Please select one of the following topics:
What is a home inspection?
What does a home inspection include?
Why do I need a home inspection?
How much will it cost?
Why can't I do it myself?
Can a house fail inspection?
How do I find a home inspector?
What is ASHI?
Who belongs to ASHI?
When do I call a home inspector?
Do I have to be there?
What if the report reveals problems?
If the house proves to be in good condition, did I really need an inspection?
What is a home inspection?
A home inspection is an objective visual examination of the physical structure and systems of a house, from the roof to the foundation.
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What does a home inspection include?
The standard home inspector’s report will cover the condition of the home’s heating system; central air conditioning system (temperature permitting); interior plumbing and electrical systems; the roof, attic and visible insulation; walls, ceilings, floors, windows and doors; the foundation, basement and structural components.
The American Society of Home Inspectors (ASHI) publishes a Standards of Practice and Code of Ethics that outlines what you should expect to be covered in your home inspection report.
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Why do I need a home inspection?
Buying a home could be the largest single investment you will ever make. To minimize unpleasant surprises and unexpected difficulties, you’ll want to learn as much as you can about the newly constructed or existing house before you buy it. A home inspection may identify the need for major repairs or builder oversights, as well as the need for maintenance to keep it in good shape. After the inspection, you will know more about the house, which will allow you to make decisions with confidence.
If you already are a homeowner, a home inspection can identify problems in the making and suggest preventive measures that might help you avoid costly future repairs.
If you are planning to sell your home, a home inspection can give you the opportunity to make repairs that will put the house in better selling condition.
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What will it cost?
The inspection fee for a typical one-family house varies geographically, as does the cost of housing. Similarly, within a given area, the inspection fee may vary depending on a number of factors such as the size of the house, its age and possible optional services such as septic, well or radon testing.
Do not let cost be a factor in deciding whether or not to have a home inspection or in the selection of your home inspector. The sense of security and knowledge gained from an inspection is well worth the cost, and the lowest-priced inspection is not necessarily a bargain. Use the inspector’s qualifications, including experience, training, compliance with your state’s regulations, if any, and professional affiliations as a guide.
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Why can't I do it myself?
Even the most experienced homeowner lacks the knowledge and expertise of a professional home inspector. An inspector is familiar with the elements of home construction, proper installation, maintenance and home safety. He or she knows how the home’s systems and components are intended to function together, as well as why they fail.
Above all, most buyers find it difficult to remain completely objective and unemotional about the house they really want, and this may have an effect on their judgment. For accurate information, it is best to obtain an impartial, third-party opinion by a professional in the field of home inspection.
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Can a house fail a home inspection?
No. A professional home inspection is an examination of the current condition of a house. It is not an appraisal, which determines market value. It is not a municipal inspection, which verifies local code compliance. A home inspector, therefore, will not pass or fail a house, but rather describe its physical condition and indicate what components and systems may need major repair or replacement.
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How do I find a home inspector?
You can ask friends or business acquaintances to recommend a home inspector they have used. Or, you can use the Find An Inspector search tool for a list of home inspectors in your area who belong to the non-profit professional organization. To have a list mailed to you, call 1-800-743-ASHI (2744). Also, real estate agents and brokers are familiar with the service and may be able to provide you with a list of names from which to choose.
Whatever your referral source, you can be assured of your home inspector’s commitment to professional standards and business ethics by choosing one who has membership in ASHI.
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What is ASHI?
Since 1976, ASHI has worked to build consumer awareness of home inspection and to enhance the professionalism of its membership. The ASHI Standards of Practice and Code of Ethics serves as a performance guideline for home inspectors, and is universally recognized and accepted by many professional and governmental bodies.
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Who belongs to ASHI?
ASHI is an organization of independent, professional home inspectors who are required to make a commitment, from the day they join as ASHI Associates, to conduct inspections in accordance with the ASHI Standards of Practice and Code of Ethics, which prohibits engaging in conflict-of-interest activities that might compromise their objectivity. ASHI Associates work their way to ASHI Certified Inspector status as they meet rigorous requirements, including passing a comprehensive, written technical exam and performing a minimum of 250 professional, fee-paid home inspections conducted in accordance with the ASHI Standards of Practice and Code of Ethics. Mandatory continuing
education helps the membership stay current with the latest in technology, materials and
professional skills.
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When do I call a home inspector?
Typically, a home inspector is contacted immediately after the contract or purchase agreement has been signed. Before you sign, be sure there is an inspection clause in the sales contract, making your final purchase obligation contingent on the findings of a professional home inspection. This clause should specify the terms and conditions to which both the buyer and seller are obligated.
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Do I have to be there?
While it’s not required that you be present for the inspection, it is highly recommended. You will be able to observe the inspector and ask questions as you learn about the condition of the home and how to maintain it.
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What if the report reveals problems?
No house is perfect. If the inspector identifies problems, it doesn’t mean you should or shouldn’t buy the house, only that you will know in advance what to expect. If your budget is tight, or if you don’t want to become involved in future repair work, this information will be important to you. If major problems are found, a seller may agree to make repairs.
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If the house proves to be in good condition, did I really
need an inspection?
Definitely. Now you can complete your home purchase with confidence. You’ll have learned many things about your new home from the inspector’s written report, and will have that information for future reference. Click here for an Home inspection checklist.
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Title Insurance Companies
Questions About Title InsuranceTitle insurance, especially Owner's title insurance, is extremely important when purchasing a house or piece of property. Yet many consumers are unsure about what title insurance is and what it protects against. Here are some answers to the more common questions about title insurance.
Types of Title Insurance
There are two types of title insurance: Lenders title insurance, also called a Loan Policy, and Owner's title insurance. Most lenders require a Loan Policy when they issue you a loan. The Loan Policy is usually based on the dollar amount of your loan. It protects the lender's interests in the property should a problem with the title arise. The policy amount decreases each year and eventually disappears as the loan is paid off. Owner's title insurance is usually issued in the amount of the real estate purchase. It is purchased for a one-time fee at closing and lasts as long as you or your heirs have an interest in the property. This may even be after the insured has sold the property. Only Owner's title insurance fully protects the buyer should a problem arise with the title that was not uncovered during the title search. Owner's title insurance also pays for any legal fees involved in defending a claim to your title. Prices, and the way title insurance is issued, vary from state to state. Contact a title company in your state to see how it is handled. For a list of title companies in your area, click here. Simply enter your city and state.
How Am I Protected?
In order to issue title insurance, the title company must search public land records for matters affecting that title. Many search the "chain" of title back 50 years. Twenty-five percent of title searches find a title problem that is fixed before the insurance is issued. Some examples of items that can cause a problem are: deeds, wills and trust that contain improper information; outstanding judgments or tax liens against the property; and easements. Title companies fix the problems then issue the title insurance. Occasionally, in spite of an exhaustive title search, hidden hazards can emerge after closing. Things such as mistakes in the public record, previously undisclosed heirs claming to own the property; or forged deeds could cloud the title. Owner's title insurance offers financial protection against these by negotiating with third-parties, and paying claims and the legal fees involved in defending the title.
Common Title Problems
Working with an experienced and licensed REALTOR and Title/Escrow Officer can help you answer other questions that may arise.Here are three short stories on some common title problems:Fraud & Forgery(NAPS) — Those involved in real estate fraud and forgery can be clever and persistent. which can spell trouble for your home purchase. In a western state, an innocent buyer purchased an attractive home site through a realty company, accepting a notarized deed from the seller. Then another couple, the trio owners of the property—who lived in another locale—suddenly appeared and initiated legal action to prove their interest in the real estate was valid. Under the owner’s title insurance policy of the innocent buyer, the title company provided a money settlement to protect against financial loss. As it turned out, the forger spent time in advance at the local court house, searching the public records to locate property with out of town owners who had been in possession for an extended period of time. The individual involved then forged and recorded a deed to a fictitious person and assumed the identity of that person before listing the property for sale to an innocent purchaser, handling moot contracts through an answering service. Also, the identity of the notary appearing on deeds was fictitious as well. Fraud and forgery are examples of hidden title hazards that can remain undetected until after a closing despite the most careful precautions.
Although emphasizing risk elimination, an owner’s title insurance policy protects financially through negotiation by the insurer with third parties, payment for defending against an attack on the title as insured, and payment of valid claims.
Conflicting Wills(NAPS) — Conflicts over a will from a deceased former owner may suggest a study topic for law school. But the subject can take on a reality dimension and all too quickly your home ownership is at stake. After purchasing a residence, the new owner was startled when a brother of the seller claimed an ownership interest and sought a substantial amount of money as his share. It seemed that their late mother had given the house to the son making the challenge, who placed the deed in his drawer without recording it at the court house. Some 20 years later, after the death of the mother, the deed was discovered and then filed. Permission was granted in probate court to remove the property from the late mother’s estate, and the brother to whom the residence initially was given sold the house. But the other brother appealed the probate court decision, claiming their mother really did not intend to give the house to his sibling. Ultimately, the appeal was upheld and the new owner faced a significant financial loss. Since the new owner had acquired owner’s title insurance upon purchasing the real estate, the title company paid the claim, along with an additional amount in legal fees incurred during the defense.
Missing Heirs(NAPS) - When buying a home, it's important to remember what you don't know can cost you. As an example illustrating the need for precautions, The American Land Title Association pointed to a couple who purchased a residence from a widow and her daughter, the only known heirs of the husband and father who died without leaving a will. Soon after the sale, a man appeared - claiming he was the son of the late owner by a former marriage. As it turned out, he indeed was the son of the deceased man. This legal heir disapproved of his father's remarriage and had vanished when the wedding took place. Nonetheless, the son was entitled to a share of the value of the home, which meant an expensive problem for the unwary couple purchasing the property. Although the absence of a will hindered discovery of the missing heir in a title search of the public records, ALTA said that owner's title insurance issued at the time of the real estate transaction would have financially protected the couple from the claim by the missing heir. For a one-time charge at closing, owner's title insurance will safeguard against problems including those even an exhaustive search will not reveal. ALTA reminded that owner's title insurance is necessary to fully protect a home buyer. Lender's title insurance, which is usually required by the mortgage lender, serves as protection only for the lending institution.
I'm refinancing, why do I need title insurance?
When you refinance you are obtaining a new loan, even if you stay with your original lender. Your lender will require lender's title insurance to protect their investment in the property. You will not need to purchase a new owner's title policy; the one you bought at closing is good for as long as you and your heirs have an interest in the property. Even if you recently purchased or refinanced your home, there are some problems that could arise with the title. For instance, you might have incurred a mechanics lien from a contractor who claims he/she has not been paid. Or you might have a judgment placed on your house due to unpaid taxes, homeowner dues, or child support for instance. The lender needs reassurance that the title to the property they are financing is clear. If it has been no more than 10 years since you bought your house or refinanced, ask for a reissue or discount rate. They are not available in every state, and you might have to meet some criteria to be eligible, so be sure to ask.
I'm buying a newly built home, do I need title insurance?
Construction of a new home raises special title problems for the lender and owner. You may think you are the first owner when constructing a home on a purchased lot. However, there were most likely many prior owners of the unimproved land. A title search will uncover any existing liens and a survey will determine the boundaries of the property being purchased. In addition, builders routinely fail to pay subcontractors and suppliers. This could result in the subcontractor or supplier placing a lien on your property. Again, lenders want to be sure the property has clear title, and they are insuring the correct property. Purchasing owner's title insurance will protect you against these potential problems and pay for any legal fees involved in defending a claim.
Finding a Local Title Company
Closing your loan can vary from state to state, and even within the same county or city. Settlements can be conducted by lenders, title insurance companies, escrow companies, real estate brokers or attorneys. Be sure to ask your Realtor® how your settlement will be handled. You may save money by shopping for your settlement or title agent. To view a list of American Land Title Association members in your city and state, click here.
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