HOW TO SELECT A HOME INSPECTOR

It is always more difficult to select a service provider than it is to select a product. A product is tangible. It has tires you can kick. A service is intangible and hard to measure or compare. When most people have to select a service, they look for something they can compare between service providers. Sometimes the only thing they can compare is price.

Unfortunately, price is not always a good factor to use when comparing services. If you needed an operation, would you get the cheapest doctor? If you were arrested, would you get the cheapest lawyer? If you were buying a home, would you use the cheapest home inspector?

When selecting a home inspector, price can be useful to eliminate the really cheap and really expensive home inspectors. If you find certain companies much cheaper or much more expensive than the industry standard, it's because they are selling a different service. The cheap companies are either doing less or have inferior credentials (experience, training, education). The much more expensive companies may be doing more than you really need, i.e. extra long inspections with unnecessary bells and whistles. So, price can be used to weed out the cheap inspections and gold plated inspections. People get home inspections to reduce their risk.
An inferior inspection at any price is not a bargain.

So, what ARE the factors to consider when selecting a home inspector?

1. Credentials - You want to be sure your home inspector knows what he is doing, so check his credentials. There are numerous professional home inspection organizations. But only two have stringent standards (verified testing and experience). They are American Society of Home Inspectors (ASHI) and National Association of Home Inspectors (NAHI).

ASHI is the oldest and largest Home Inspection Organization but NAHI is the fastest growing Home Inspection organization.

Membership in either of these organizations provides the consumers with the knowledge that the Home Inspector is at least MINIMALLY qualified, but not necessarily competent.

2. Experience - It is not only important that your home inspector knows what he is doing but also that he has enough experience doing it that he can make an informed decision and give valuable advice. Throughout the country, the average home inspector does about 260 inspections a year*, but many of the more successful ones do 600-700 or more inspections a year. For an inspector to be really top notch, he needs to have done at least 1,000 home inspections in his career.

Many of the cheap home inspectors are new to the occupation; some are part timers. Some have little or no experience. Some buy franchises and claim experience gained by others in the franchise in other cities.

Always ask, "How many professional homebuyers inspections has the inspector who is going to inspect my house actually performed?" Also, almost all of the cheap home inspection companies are one-man operations. These are people who decided they wanted to be home inspectors. They didn't go through any application process, selection process or specialized training process. Only they know what their qualifications are.

Also, be wary of claims of experience. Home inspectors will make claims like 35 years experience. Thirty-five years ago, there were only a handful of professional inspectors in the whole country. Building or repairing homes is related experience but not experience as a home inspector.

3. Stability - Most home inspection companies are small operations - one or two people. A multiple inspector firm with 4 or 5 inspectors is considered a very large and established company in this industry. Unfortunately, many home inspection companies are not really professional. They operate out of their home or truck. They use a cell phone, answering service, or their spouse answers the phone. If they get sick, they don't show up at your inspection. If they go on vacation right after doing your inspection, you can't reach them if you have questions. Look for a company which has a physical office with regular working hours and a professional staff. Multiple inspector firms can handle emergencies better. They don't all get sick or go on vacation at the same time.

Also, longevity is an indicator of stability. Ask, how long have you been in business? Be careful, franchise inspectors will tell you how long the franchise has been in business, not how long THEY have been in business.

4. Reputation and referrals - If you know someone who has had a good experience with a specific inspector that is definitely a positive. But, an overall good reputation is more important than a single recommendation. Many Realtors don't want to make specific recommendations, so ask friends, your attorney, mortgage broker, etc. If you keep hearing the same name that is a pretty good endorsement.

Some Realty companies compile lists of preferred vendors. These lists can be a real help when they are comprised of the companies the Real Estate agents think can do the best job. But beware, some Realty companies only include companies who pay a fee for "joint advertising" or financially sponsor events for the Realty company. This is an unethical practice for both the Real Estate company and the inspector.

5. Convenience - Home inspections need to be done quickly after contract ratification. It's important to get someone who can perform the inspection within the constraint of the contract. Most contracts allow 5-10 days to complete the inspection. But the best advice is the sooner the better. Also, it's important you attend the inspection. So, performing the inspection to fit your schedule can be important. Also, companies providing a report and reviewing the report and answering any questions at the end of the inspection is more convenient.

6. E & O insurance vs. dispute resolution/arbitration - Some home inspectors advertise that they carry E & O insurance like it is actually a benefit to their clients. The purpose of E & O insurance is widely misunderstood. E & O insurance protects the inspector, not his client. If you have a claim against a home inspector with E & O insurance, it doesn't mean his insurance company automatically pays you. It means you will have to resolve your disagreement with the insurance company's lawyer, not the home inspector. He is out of it. The lawyer's job isn't to fairly and equitably resolve disputes; it's to WIN for their client, the insurance company. They will use every legal means at their disposal to accomplish this.

Reputable home inspection companies incorporate a dispute resolution procedure and arbitration within their agreement for home inspection services. These procedures clearly and concisely lay out the way all disputes after the inspection will be resolved. If following these procedures doesn't satisfactorily resolve the dispute, the next step is arbitration. Arbitration is a quick, cheap and amicable way to resolve a dispute when two reasonable people can't agree as opposed to a legal resolution which may take years, cost thousands of dollars and will be confrontational. Usually arbitration can be arranged within one or two weeks. Each side simply sits down and tells the professional arbitrator their side of the story. The professional arbitrator makes a decision, which is legally binding, for any parties involved. If you have a dispute with the home inspector, you resolve it with HIM. His motivation is to solve the problem, not WIN. Also, the arbitrators' job IS to fairly and equitably resolve disputes.

Most home inspectors who use this method have very few disputes, which aren't resolved before arbitration.

* ASHI Survey 2000

Call around, ask a few questions.

  1. Is the inspector who is going to inspect my house a NAHI or ASHI member?

  2. How long has he been an inspector and how many inspections has he performed?

  3. How long has your company been in business at this location?

  4. Do you have an office I can visit?

  5. What are your working hours?

  6. Do you have any financial arrangement (i.e. group advertisement, sponsor activities, etc.) with the Realty Company that referred you?

  7. How soon can you perform my inspection?

  8. Do you provide an on-site report?

  9. Will the inspector review the report with me and answer all my questions?

10. If there is a dispute about the inspection, do you have a written complaint resolution procedure which incorporates arbitration, or do you just turn it over to your insurance company?

I hope these tips are useful in helping select a professional home inspector. Happy house hunting.