One of the first steps after you have gotten an offer accepted, is to schedule a home inspection. The deadline to complete the inspection and provide the seller with an Inspection Objection is typically within about 7-10 days after going under contract but be sure to review the dates in your offer.
Many home inspectors have a background in construction and can offer a wealth of knowledge during the inspection process. In Colorado, there is no required licensing or educational background required to become a home inspector so it's important to do some research and find someone who is experienced and recommended. Your agent should have at least a couple of inspectors that they can refer you to.
The inspector will go through the interior and exterior of the home as thoroughly as possible (without tearing anything apart) to make sure everything is in good order and point out any concerns. A home inspection will cost $375-$700 depending on several factors including the size of the home.
You may want to consider having a sewer scope performed to check for any damage to the main sewer line, especially if it's an older home or there are big trees in the yard. A sewer line repair can be a big expense so it worth investigating to find out if there are any issues during the inspection phase. A sewer scope will cost about $120-$175.
If you are purchasing a property that has a well and/or septic system (usually in the foothills/mountains or rural areas) this will require a different inspection process.
A radon test is another option that you will want to consider adding as well. Radon is an odorless gas that escapes from the ground and can build up inside your home. At higher levels over an extended period, it can cause lung cancer in humans. If the test comes back with a rating above the EPA recommended limit of 4.0 pCi/L, there are radon mitigation systems that can be installed to vent the gas out of the home. As part of the inspection objection, you may ask the sellers to have a mitigation system installed. A radon test will run $125-$175.
When scheduling the inspection, ask the inspector how long they expect it to take and what time they would like you to be there. Typically an inspection will take 2-4 hours and the inspector will spend the last 30 minutes or so giving you a rundown of the home and explaining any items of concern.
Buyers are not required to attend the inspection, but it is a great opportunity to learn of major red flags, potential future issues, and what to do for ongoing maintenance. This is also one more chance to see the home again in-person and take any measurements or photos. The inspection day will likely be the last time you see the house until the final walkthrough right before closing.
Once the inspection is completed, you should receive a full report of all the inspector's findings with recommendations, explanations, and photos. From there, you and your agent will discuss how to proceed. Your options are:
1. Move forward as-is if the inspection turned up nothing that is of concern or you have terms in your offer stating that you would not provide an objection.
2. Submit an Inspection Objection asking the sellers to make selected repairs or provide credit so that you can have the work done later.
3. Terminate the contract if you are no longer comfortable with moving forward with the purchase of that home regardless of any repairs or credits the seller may be willing to offer. As long as the termination is submitted prior to the Inspection Termination deadline in your contract, your earnest money will be returned to you. The money you spend on the inspection is not refundable should you decide to terminate, but it probably saved you a lot of money in the end if it prevented you from buying a money pit.
Keep in mind that no home is without some flaws, even brand new construction. Talk through any concerns with your real estate agent. If needed, seek additional advice from qualified contractors to see what they say about what the inspection revealed.
If you submit an inspection objection, the seller will have a couple days (see the Inspection Resolution deadline in your contract) to respond with their offer to complete requested repairs and/or provide credits or offer something different. The sellers do not have the right to terminate the contract. Sellers can, however, decide that they do not want to make any concessions or offer less than what you've requested. If that's the case, you will have to decide if you are still willing to move forward. Oftentimes, it will make sense for the seller to work with you on reasonable health and safety and structural concerns because they know they will have to probably address those same items with another buyer in the future.
