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Inspections are necessary to ensure that there are no health and safety issues and that a home will not need major repairs after close of escrow. Inspections can be done for any one or more of the following items: pest, roof, well, soil, septic tank, and natural hazards. The cost of or payment for the inspections and the cost of any recommended or required repairs is negotiable between you and the seller.

If an inspection report calls out significant damage or any health and safety issues, lenders will require that repairs be made prior to close of escrow, unless a property is purchased “as is.” An “as is” purchase is a purchase offer with no inspection contingencies.

If a purchase is not “as is” and inspections illuminate significant repair needs that you, the buyer, were unaware of at the time of the offer, you can use the inspection report as a reason to back out of the purchase. You can also use inspection reports as a reason to renegotiate the terms of your offer, such as a seller credit for closing costs or a reduced price.