Congratulations! You just made a purchase agreement on what you hope will be your dream home. Now you are in your five to ten day grace period where you are allowed to practice due diligence and you are now looking to have a professional home inspection done. So where do you start?
No doubt your Realtor just handed you a list of three home inspection companies to call. Many home buyers really don’t give it a second thought. But if you stop and think about it for just a minute, just how did these home inspectors get on this list? After all, there are over 100 home inspectors to choose from in any metropolitan area alone, but your Realtor only gave you three names. You should ask yourself this question, are these three names on this list the best home inspection companies in town? Maybe they are and maybe they aren’t. How do you know?
When it comes to home inspections, there are typically two different kinds of home inspection companies. There are the franchise companies and there are your local independent home inspection companies. What is very important to understand here, is that all of the franchise companies as well as some of the smaller inspection companies spend a considerable amount of money every year marketing to Realtors. Along with their marketing strategies, they also spend lots of money sponsoring Realtor related activities such as golf outings, fancy dinner parties, the Realtors ball etc. So what do you suppose the home inspection company gets in return for all of their money spent? You got it, referrals, hence the names found on your list. Many of the larger inspection companies actually have quotas for the home inspectors to try and reach such as how many Realtors they can cozy up to in a month. Doesn’t sound very ethical does it? The fact is, it isn’t ethical at all, but yet it happens every single day and somehow this unethical practice is allowed to continue year after year. How? Plain and simple, no one has the huevos to rock the boat. It’s the old “don’t bite the hand that feeds you” mentality.
When home inspectors market to Realtors there is an immediate conflict of interest that is created. The home inspector wants referrals for their business and the Realtor wants all of their sales to go to closing so they can get paid. No further explanation is needed on this one, it speaks for itself.
So, now you may be looking at that list your Realtor just handed you a little bit different, as well you should. When looking for a professional home inspector to inspect your potential new home, you want to be absolutely certain that you know where their allegiance lies. Is it with you, or is it with the Realtor involved in the transaction? Here are just a few tips to help you make one of the most important decisions you will ever make.
· Prior to calling any home inspection company, check them out first. Go online and look for their website. A home inspection company’s website will tell you quite a bit about the company and the way they do business. Look for the tell tale phrases on their website that indicate that they are “Realtor friendly”. They will have phrases such as “we are a team player”, “we won’t kill your deal”, “trust the company that real estate agents trust”, “we do not concern ourselves with nitpicky items” etc. (these are actual phrases taken from a few home inspection websites). Some home inspection companies will even devote an entire page on their website to Realtors explaining why the Realtors should choose them over other inspection companies. Even worse, some have stooped so low as to offer sweepstakes giveaways to Realtors. Yes, a home inspection company’s website will tell you quite a bit if you just take the time to read through it.
· Check out the home inspection company’s standing with the Better Business Bureau. Many consumers seem to have forgotten about this time tested and trustworthy way of checking out a business. You might be very surprised to see that many home inspection companies don’t have a very good rating with the BBB. Very few actually do. If you think about it, any home inspection company that compromises their integrity and their clients by paying money to Realtors in ANY way shape or form probably isn’t going to have a very good rating with the BBB.
· Ask friends, family and co-workers about their home inspection experience. Anyone who has had a positive experience with a home inspection company will be quick to tell you about it. They will be even quicker to tell you about any negative experiences they have encountered. Never underestimate the power of word of mouth.
· When calling a home inspection company, ask them up front how they advertise? And what makes up the bulk of their referrals? I guarantee, the answer to those two questions alone will tell you all you need to know.
Here at MC2 Home Inspections, we are part of a very small minority that tries to educate consumers on the realities of the real estate industry in the hopes of change. The hand that feeds us is you the consumer, NOT the Realtor. While there are many home inspection companies to choose from, very few actually share this same vision and hope.
Protect yourself, protect your investment and practice due diligence before hiring any home inspection company. Do not just simply take your Realtors recommendation and consider it golden. Look for the home inspection companies that market to the consumer and not the Realtor. They are out there, and yes they are hard to find but you will be doing yourself a huge favor as these home inspection companies will have no vested interest in the property you are considering purchasing. Nor will they feel any pressure (either stated or unstated) from any Realtors involved in the transaction.