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Helpful Tips for Home Buyers!

On this page you will find articles that will help you in choosing the right Home Inspector for you and in the Home buying process. Please feel free to ask us any questions. We hope this information will help you in making an informed decision about the home inspector you choose. 

A Home Inspection Is The Most Important Part Of Buying Your Home. Make Sure You Make The Right Choice!

Consumer Reports Article

Home Inspection

Check Out This Great Resource for Home Buyers by InterNachi! This has some great information for home buyers who are going through the process. It's a downloadable PDF. 

Three Deadly Mistakes Every Home Buyer Should Avoid

Deadly Mistake #1: Thinking you can't afford it.


Many people who thought that buying the home they wanted was simply out of their reach are now enjoying a new lifestyle in their very own homes.
 
Buying a home is the smartest financial decision you will ever make. In fact, most homeowners would be broke at retirement if it wasn't for one saving grace -- the equity in their homes. Furthermore, tax allowances favor home ownership.
 
Real estate values have always risen steadily. Of course, there are peaks and valleys, but the long-term trend is a consistent increase. This means that every month when you make a mortgage payment, the amount that you owe on the home goes down and the value typically increases. This "owe less, worth more" situation is called equity build-up and is the reason you can't afford not to buy.
 
Even if you have little money for a down payment or credit problems, chances are that you can still buy that new home. It just comes down to knowing the right strategies, and working with the right people. See below.
 
 
Deadly Mistake #2: Not hiring a buyer's agent to represent you.
 
Buying property is a complex and stressful task. In fact, it is often the biggest, single investment you will make in your lifetime. At the same time, real estate transactions have become increasingly complicated. New technology, laws, procedures, and competition from other buyers require buyer agents to perform at an ever-increasing level of competence and professionalism. In addition, making the wrong decisions can end up costing you thousands of dollars. It doesn't have to be this way!
 
Work with a buyer's agent who has a keen understanding of the real estate business and the local market. A buyer's agent has a fiduciary duty to you. That means that he or she is loyal only to you and is obligated to look out for your best interests. A buyer's agent can help you find the best home, the best lender, and the best home inspector in your area. That inspector should be an InterNACHI-certified home inspector because InterNACHI inspectors are the most qualified and best-trained inspectors in the world.
 
Trying to buy a home without an agent or a qualified inspector is, well... unthinkable.
 
Deadly Mistake #3: Getting a cheap inspection.
 
Buying a home is probably the most expensive purchase you will ever make. This is no time to shop for a cheap inspection. The cost of a home inspection is small relative to the value of the home being inspected. The additional cost of hiring a certified inspector is almost insignificant by comparison. As a home buyer, you have recently been crunching the numbers, negotiating offers, adding up closing costs, shopping for mortgages, and trying to get the best deals. Don't stop now! Don't let your real estate agent, a "patty-cake" inspector, or anyone else talk you into skimping here.
   
InterNACHI front-ends its membership requirements. InterNACHI turns down more than half the inspectors who want to join because they can't fulfill the membership requirements.
 
InterNACHI-certified inspectors perform the best inspections, by far. InterNACHI-certified inspectors earn their fees many times over. They do more, they deserve more and -- yes -- they generally charge a little more. Do yourself a favor...and pay a little more for the quality inspection you deserve.

Building a Home

If you want to build a new home, there are things you need to know before you begin. Learn about construction standards and about buying land, so you know your rights.


MPS Supplementing Model Building Codes
 
The Minimum Property Standards (MPS) establish certain minimum standards for buildings constructed under HUD housing programs. This includes new single-family homes, multi-family housing and healthcare-type facilities.
 
HUD Minimum Property Standards and How They Supplement the Model Building Codes
Until the mid-1980s, HUD maintained separate Minimum Property Standards for different types of structures. Since that time, HUD has accepted the model building codes, including over 250 referenced standards and local building codes, in lieu of separate and prescriptive HUD standards. However, there is one major area of difference between the MPS and other model building codes -- durability requirements. Homes and projects financed by FHA-insured mortgages are the collateral for these loans, and their lack of durability can increase the FHA's financial risk in the event of default. More specifically, the model codes do not contain any minimum requirements for the durability of items such as doors, windows, gutters and downspouts, painting and wall coverings, kitchen cabinets and carpeting. The MPS includes minimum standards for these, and other items, to ensure that the value of an FHA-insured home is not reduced by the deterioration of these components.
 
HUD Field Office Acceptance for Areas Without Building Codes
 
HUD requires that each property insured with an FHA mortgage meet one of the nationally recognized building codes or a state or local building code based on a nationally recognized building code. In areas where such state or local codes are used, HUD determines if the state or local code is comparable to the model building code. There are also areas of the United States that do not have building codes. If no state or local building code has been adopted, the appropriate HUD Field Office will specify a building code that is comparable to one of the nationally recognized model building codes.
Interstate Land Sales
 
The Interstate Land Sales program protects consumers from fraud and abuse in the sale or lease of land. In 1968, Congress enacted the Interstate Land Sales Full Disclosure Act, which is patterned after the Securities Law of 1933, and requires land developers to register subdivisions of 100 or more non-exempt lots with HUD, and to provide each purchaser with a disclosure document called a property report. The property report contains relevant information about the subdivision and must be delivered to each purchaser before the signing of the contract or agreement.
 
Buying Lots from Developers
Be well informed when shopping for land. Lots may be marketed as sites for future retirement homes, for second home locations, or for recreational or campsite use. However, be wary of any investment aspect that may be stressed by sales personnel. If you plan to purchase a lot which is offered by promotional land sales, take plenty of time before coming to a decision. Before signing a purchase agreement, a contract, or a check:
know your rights as a buyer;
know something about the developer;
know the facts about the development and the lot you plan to buy; and
know what you are doing when you encounter high-pressure sales campaigns.
Generally, if the company from which you plan to buy is offering 100 or more unimproved lots for sale or lease through the mail or by means of interstate commerce, it may be required to register with the U.S. Department of Housing and Urban Development (HUD). This means that the company must file with HUD and provide prospective buyers with a property report containing detailed information about the property. Failure to do this may be a violation of federal law, punishable by up to five years in prison, a $10,000 fine, or both. The information filed by the developer and retained by HUD must contain such items as these:
a copy of the corporate charter and financial statement;
information about the land, including title policy or attorney's title opinion, and copies of the deed and mortgages;
information on local ordinances, health regulations, etc.;
information about facilities available in the area, such as schools, hospitals and transportation systems;
information about availability of utilities and water, and plans for sewage disposal;
development plans for the property, including information on roads, streets and recreational facilities; and
supporting documents, such as maps, plans and letters from suppliers of water and sewer facilities.
The company filing this information must swear and affirm that it is correct and complete, and an appropriate fee must accompany submission. The information is retained by HUD and is available for public inspection. The property report, which is also prepared by the developer, goes to the buyer. The law requires the seller to give the report to a prospective lot purchaser prior to the time a purchase agreement is signed. Ask for it. The seller is also required to have the buyer sign a receipt acknowledging receipt of the property report. Do not sign the receipt unless you have actually received the property report. Check the developer’s property report before buying. This is the kind of information you will find in a property report:
distances to nearby communities over paved and unpaved roads;
existence of mortgages or liens on the property;
whether contract payments are placed in escrow;
availability and location of recreational facilities;
availability of sewer and water service or septic tanks and wells;
present and proposed utility services and charges;
the number of homes currently occupied;
soil and foundation conditions which could cause problems in construction or in using septic tanks; and
the type of title the buyer may receive and when it should be received.


Read the Property Report Before Signing Anything
 
This report is prepared and issued by the developer of this subdivision. It is not prepared or issued by the federal government. Federal law requires that you receive this report prior to signing a contract or agreement to buy or lease a lot in this subdivision. However, no federal agency has judged the merits or value of the property. If you received the report prior to signing a contract or agreement, you may cancel your contract or agreement by giving notice to the seller any time before midnight of the seventh day following the signing of the contract or agreement. If you did not receive this report before you signed a contract or agreement, you may cancel the contract or agreement any time within two years from the date of signing.
Your Contract Rights
 
If the lot you are buying is subject to the jurisdiction of the Interstate Land Sales Full Disclosure Act, the contract or purchase agreement must inform you of certain rights given to buyers by that Act. The contract should state that the buyer has a "cooling-off" period of seven days (or longer, if provided by state law) following the day that the contract is signed to cancel the contract, for any reason, by notice to the seller, and get his or her money back. Furthermore, unless the contract states that the seller will give the buyer a warranty deed, within 180 days after the contract is signed, the buyer has a right to cancel the contract for up to two years from the day that the contract is signed, unless the contract contains the following provisions:
a clear description of the lot so that the buyer may record the contract with the proper county authority;
the right of the buyer to a notice of any default (by the buyer), and at least 20 days after receipt of that notice to cure or remedy the default;
a limitation on the amount of money the seller may keep as liquidated damages, of 15% of the principal paid by the buyer (exclusive of interest) or the seller's actual damages, whichever is greater.
Contract Rights Concerning Property Reports
It has always been the law that if the developer has an obligation to register with the Interstate Land Sales Division, the developer or sales agent must give the buyer a copy of the current property report before the buyer signs a contract. Otherwise, the buyer has up to two years to cancel the contract and get their money back. That fact must also be clearly set forth in all contracts. You may have the right to void the contract if the subdivision has not been registered with HUD, or you were not given a property report. Furthermore, if the developer has represented that it will provide or complete roads, water, sewer, gas, electricity or recreational facilities in its property report, in its advertising, or in its sales promotions, the developer must obligate itself to do so in the contract, clearly and conditionally (except for acts of nature or impossibility of performance). In addition to the right to a full disclosure of information about the lot, the prospective buyer may have the right to void the contract and receive a refund of their money if the developer has failed to register the subdivision with HUD or has failed to supply the purchaser with a property report. While a purchaser may have the right to void the contract with the developer under these conditions, the purchaser may still be liable for contract payments to a third party if that contract has been assigned to a financing institution or some similar entity. The registration is retained by HUD and is available for public inspection. If the property report contains misstatements of fact, if there are omissions, if fraudulent sales practices are used, or if other provisions of the law have been violated, the purchaser may also sue to recover damages and actual costs and expenses in court against the developer. However, depending on when your sale occurred, you may be barred from taking further action due to the Act's statute of limitations. Your attorney can advise you further on this matter.
 
"Cooling-Off" Period
 
Even if you received the property report prior to the time of your signing of the contract or agreement, you have the right to revoke the contract or agreement by notice to the seller until midnight of the seventh day following the signing of the contract. You should contact the developer, preferably in writing, if you wish to revoke your contract and receive a refund of any money paid to date. Even if the property report is delivered to you before you sign a sales agreement, the law gives you a "cooling-off " period. This right cannot be waived.
 
A Word About the Interstate Land Sales Division
The HUD unit which administers the law, examines the developer's registration statement, and registers the land sales operator is the Interstate Land Sales Division. Except for disclosure purposes, this office is not concerned with zoning or land-use planning, and has no control over the quality of the subdivision. It does not dictate what land can be sold, to whom, or at what price. It cannot act as a purchaser's attorney. But it will help purchasers secure the rights given to them by the Interstate Land Sales Full Disclosure Act. HUD is authorized by law to conduct investigations and public hearings, to subpoena witnesses and secure evidence, and to seek court injunctions to prevent violations of the law. If necessary, HUD may seek criminal indictments. HUD is authorized by law to conduct investigations and, if necessary, seek criminal indictments.
 
Exemptions from the Law
The prospective buyer should be aware that not all promotional land sales operations are covered by the law. If the land sales program is exempt, no registration is required by HUD, and there will be no property report. Here are some of the specific situations for which the statute allows exemptions without review by HUD, including the sale of:
tracts of fewer than 100 lots which are not otherwise exempt;
lots in a subdivision where every lot is 20 acres or more in size;
lots upon which a residential, commercial or industrial building has been erected, or where a sales contract obligates the seller to build one within two years;
certain lots which are sold only to residents of the state or metropolitan area in which the subdivision is located;
certain low-volume sales operations (no more than 12 lots a year);
certain lots that meet certain local codes and standards and are zoned for single-family residences or are limited to single-family residences by enforceable codes and restrictions; and
certain lots, contained in multiple sites of fewer than 100 lots each, offered pursuant to a common promotional plan.
Other exemptions are available which are not listed above. If you have reason to believe that your sale is not exempt and may still be covered by the law, contact the Interstate Land Sales Division.
 
Know the Developer
 
Knowing your rights under the law is the first step in making a sensible land purchase. To exercise those rights, you also must know something about the honesty and reliability of the developer who offers the subdivision that interests you. Don’t fail to ask questions. Whether you are contacted by a sales agent on the phone or by mail, at a promotional luncheon or dinner, in a sales booth at a shopping center, or in the course of your own inspection of the subdivision, make it your business to find out all you can about the company and the property. In addition, get any verbal promises or representations in writing. Don’t fail to ask questions. If you are seriously interested in buying a lot, ask if the company is registered with HUD or is entitled to an exemption. Request a copy of the property report and take the time to study it carefully and thoroughly. If you still have unanswered questions, delay any commitment until you have investigated. Discuss current prices in the area with local independent brokers. Talk to other people who have purchased lots. A local Chamber of Commerce, Better Business Bureau, or consumer protection group may have information about the seller's reputation. Inquire through county or municipal authorities about local ordinances or regulations affecting properties similar to that which you plan to buy. Don't be high-pressured by sales agents.
 
Know the Facts About the Lot
 
Once you have decided on an appealing subdivision, inspect the property. Don't buy "sight unseen." Better yet, hire an InterNACHI inspector to perform a thorough property inspection. Also, check the developer's plans for the project and know what you are getting with your lot purchase. It's a good idea to make a list of the facts you will need to know. Some of the questions you should be asking, and answering, are these:
How large will the development become?
What zoning controls are specified?
What amenities are promised?
What provision has the developer made to assure construction and maintenance?
What are the provisions for sewer and water service?
Are all of the promised facilities and utilities in the contract?
Will there be access roads or streets to your property, and how will they be surfaced? Who maintains them? How much will they cost?
Will you have clear title to the property? What liens, reservations or encumbrances exist?
Will you receive a deed upon purchase or a recordable sales contract?
What happens to your payments? Are they placed in a special escrow account to pay for the property, or are they spent at once by the developer?
If the developer defaults on the mortgage or goes bankrupt, could you lose your lot and investment to date to satisfy a claim against the development?
What happens when the developer moves out? Is there a homeowners' association to take over community management?
Are there restrictions against using the lot for a campsite until you are ready to build?
Are there any annual maintenance fees or special assessments required of property owners?
This is a partial list of points to consider before you commit your money or your signature.
 
Know What You are Doing
Interstate land sales promotions often are conducted in a high-pressure atmosphere that sweeps unsophisticated buyers along. Before they are aware that they have made a commitment, these buyers may have signed a sales contract and started to make payments on a lot. They may be delighted with the selection made, but, if not, it may be too late for a change of mind.
 
Nine Dishonest Sales Practices
 
Here are some of the practices avoided by reliable sales operations. Watch out for them and exercise sales resistance if you suspect they are occurring:
 
1. concealing or misrepresenting facts about current and resale value. Sales agents may present general facts about the area’s population growth, industrial or residential development, and real estate price levels as if they apply to your specific lot. You may be encouraged to believe that your piece of land represents an investment which will increase in value as regional development occurs. A sales agent may tell you that the developer will re-sell the lot, if you request. This promise may not be kept. Future resale is difficult or impossible in many promotional developments because much of your purchase price -- sometimes as much as 40% -- has gone for an intensive advertising campaign and commissions for sales agents. You are already paying a top price and it is unlikely that anyone else would pay you more than you are paying the developer. You may even have to sell for less than the price you originally paid for the lot. Sales promotions often are conducted in a high-pressure atmosphere. Furthermore, when you attempt to sell your lot, you are in competition with the developer, who probably holds extensive, unsold acreage in the same subdivision. In most areas, real estate brokers find it impractical to undertake the sale of lots in subdivisions and will not accept such listings. It is unlikely that the lot you purchase through interstate land sales represents an investment, in the view of professional land investors. Remember, the elements of value of a piece of land are its usefulness, the supply, the demand, and the buyer's ability to re-sell it. The Urban Land Institute estimates that land must double in value every five years to justify holding it as an investment. In some areas, the cost of holding the land, such as taxes and other assessments, can run as high as 11% a year.
 
2. failure to honor refund promises or agreements. Some sales promotions conducted by mail, email or long-distance telephone include the offer of a refund if the property has been misrepresented, or if the customer inspects the land within a certain period of time and decides not to buy. When the customers request the refund, s/he may encounter arguments about the terms of the agreement. The company may even accuse its own agent of having made a money-back guarantee without the consent or knowledge of the developer. Sometimes, the promised refund is made, but only after a long delay.
 
3. misrepresentation of facts about the subdivision. This is where the property report offers an added measure of protection. A sales agent may offer false or incomplete information relating to either a distant subdivision or one which you visit. Misrepresentations often relate to matters such as the legal title, claims against it, latent dangers (such as swamps or cliffs), unusual physical features (such as poor drainage), restrictions on use, or lack of necessary facilities and utilities. Read the property report carefully with an eye to omissions, generalizations, or unproved statements that may tend to mislead you. If you are concerned about overlooking something important, discuss the report and the contract with a lawyer who understands real estate matters. The developer also may use advertisements that imply that certain facilities and amenities are currently available when they are not. Read the property report to determine whether these facilities and amenities are actually completed, or proposed to be completed in the future. If the company advertises sales on credit terms, the Truth in Lending Act requires the sales contract to fully set forth all terms of financing. This information must include total cost, simple annual interest, and total finance charges.
 
4. failure to develop the subdivision as planned. Many buyers rely upon the developer's contractual agreement or a verbal promise to develop the subdivision in a certain way. The promised attractions that influenced your purchase (golf course, marina, swimming pool, etc.) may never materialize after you become an owner. If they are provided, it may be only after a long delay. If you are planning on immediate vacation use of the property, or are working toward a specific retirement date, you may find that the special features promised of the development are not available when you need them.
 
5. failure to deliver deeds and/or title insurance policies. Documents relating to the sales transaction may not be delivered as promised. Some sales in the promotional land development industry are made by contract for a deed to be delivered when the purchaser makes the last payment under the terms of the contract. A dishonest developer may fail to deliver the deed, or deliver it only after a long delay. A sales agent may offer false or incomplete information.
 
6. abusive treatment and high-pressure sales tactics. Some sales agents drive prospective customers around a subdivision in automobiles equipped with citizen band radios which provide a running commentary on lot sales in progress. The customer may be misled by this and other sales techniques to believe that desirable lots are selling rapidly and that a hurried choice must be made. Hurrying the buyers into a purchase they may later regret is only one ploy of high-pressure sales agents. More offensive is abusive language used to embarrass customers who delay an immediate decision to buy. In some instances, hesitant buyers have been isolated in remote or unfamiliar places where transportation is controlled by the sales agent or the agent's organization.
 
7. failure to make good on sales inducements. Free vacations, gifts, savings bonds, trading stamps, and other promised inducements are used to lure people to sales presentations or to development sites. These promised treats may never materialize. Sometimes, special conditions are attached to the lure, or a customer is advised that gifts go only to lot purchasers. A "free vacation" may be the means of delivering the prospective buyer to a battery of high-pressure sales agents in a distant place. The promised attractions may never materialize.
 
8. "bait and switch" tactics. Lots are frequently advertised at extremely low prices. When prospective buyers appear, they are told that the low-priced lots are all sold and then are pressured to buy one that is much more expensive. If the cheaper lot is available, it may be located on the side of a cliff or in another inaccessible location. If accessible, it may be much too small for a building or have other undesirable features. The buyers may be lured to the property with a certificate entitling them to a "free" lot. Often, the certificate bears a face value of $500 to $1,000. If the buyers attempt to cash it in, the amount is simply included in the regular price (often inflated) of the lot they choose. Often, this so-called "bait and switch" technique has a delayed fuse. Buyers who purchase an unseen lot for later retirement may be unpleasantly surprised when they visit the development. The lot they have paid for may be remote from other homes, shopping and medical facilities. It may be insufficiently developed for use. When the buyers complain, sales personnel attempt to switch them to a more expensive lot, applying the money paid for the original lot to an inflated price for the new one, and tacking on additional financing charges. If the unhappy purchasers lack sufficient funds to accept this alternative, they are left with an unusable, unmarketable first choice.
 
9. failure to grant rights under the Interstate Land Sales Full Disclosure Act. Purchasers may not be given copies of the property report before they sign a sales contract. Some sales agents withhold this detailed statement until customers choose a specific lot. Sometimes, the buyers receive the report in a mass of promotional materials and legal documents. Unaware that the report is in their possession, they fail to read and understand it before signing a sales contract.

Central Air-Conditioning System Inspection

A building's central air-conditioning system must be periodically inspected and maintained in order to function properly. While an annual inspection performed by a trained professional is recommended, homeowners can do a lot of the work themselves by following the tips offered in this guide


Clean the Exterior Condenser Unit and Components
 
The exterior condenser unit is the large box located on the side of the building that is designed to push heat from the inside of the building to the outdoors. Inside of the box are coils of pipe that are surrounded by thousands of thin metal "fins" that allow the coils more surface area to exchange heat. Follow these tips when cleaning the exterior condenser unit and its inner components -- after turning off power to the unit!
Remove any leaves, spider webs and other debris from the unit's exterior. Trim foliage back several feet from the unit to ensure proper air flow.
Remove the cover grille to clean any debris from the unit's interior. A garden hose can be helpful for this task.
Straighten any bent fins with a tool called a fin comb.
Add lubricating oil to the motor. Check your owner’s manual for specific instructions.
Clean the evaporator coil and condenser coil at least once a year. When they collect dirt, they may not function properly.
Inspect the Condensate Drain Line
 
Condensate drain lines collect condensed water and drain it away from the unit. They are located on the side of the inside fan unit. Sometimes there are two drain lines—a primary drain line that’s built into the unit, and a secondary drain line that can drain if the first line becomes blocked. Homeowners can inspect the drain line by using the following tips, which take very little time and require no specialized tools:
Inspect the drain line for obstructions, such as algae and debris. If the line becomes blocked, water will back up into the drain pan and overflow, potentially causing a safety hazard or water damage to your home.
Make sure the hoses are secured and fit properly.
Clean the Air Filter
The air filter slides out for easy replacement
 
Air filters remove pollen, dust and other particles that would otherwise circulate indoors. Most filters are typically rectangular in shape and about 20 inches by 16 inches, and about 1 inch thick. They slide into the main ductwork near the inside fan unit. The filter should be periodically washed or replaced, depending on the manufacturer’s instructions. A dirty air filter will not only degrade indoor air quality, but it will also strain the motor to work harder to move air through it, increasing energy costs and reducing energy efficiency. The filter should be replaced monthly during heavy use during the cooling seasons. You may need to change the filter more often if the air conditioner is in constant use, if building occupants have respiratory problems,if you have pets with fur, or if dusty conditions are present.
 
Cover the Exterior Unit
 
When the cooling season is over, you should cover the exterior condenser unit in preparation for winter. If it isn’t being used, why expose it to the elements? This measure will prevent ice, leaves and dirt from entering the unit, which can harm components and require additional maintenance in the spring. A cover can be purchased, or you can make one yourself by taping together plastic trash bags. Be sure to turn the unit off before covering it.
Close the Air-Distribution Registers
 
Air-distribution registers are duct openings in ceilings, walls and floors where cold air enters the room. They should be closed after the cooling season ends in order to keep warm air from back-flowing out of the room during the warming season. Pests and dust will also be unable to enter the ducts during the winter if the registers are closed. These vents typically can be opened or closed with an adjacent lever or wheel. Remember to open the registers in the spring before the cooling season starts. Also, make sure they are not blocked by drapes, carpeting or furniture.
 
In addition, homeowners should practice the following strategies in order to keep their central air conditioning systems running properly:
Have the air-conditioning system inspected by a professional each year before the start of the cooling season.
Reduce stress on the air conditioning system by enhancing your home’s energy efficiency. Switch from incandescent lights to compact fluorescents, for instance, which produce less heat.
 
In summary, any homeowner can perform periodic inspections and maintenance to their home's central air-conditioning system.

Choosing the Right Home Inspector


Buying a home? It's probably the most expensive purchase you'll ever make. This is no time to shop for a cheap inspection. The cost of a home inspection is very small relative to the value of the home being inspected. The additional cost of hiring an InterNACHI-Certified Professional Inspector® is almost insignificant.
 
You have recently been crunching the numbers, negotiating offers, adding up closing costs, shopping for mortgages, and trying to get the best deals. Don't stop now. Don't let your real estate agent, a "patty-cake" inspector, or anyone else talk you into skimping here. InterNACHI-certified inspectors perform the best inspections by far.
 
InterNACHI-certified inspectors earn their fees many times over. They do more, they deserve more, and -- yes -- they generally charge a little more. Do yourself a favor... and pay a little more for the quality inspection you deserve.
The licensing of home inspectors only sets a minimum standard. Much like being up to code, any less would be illegal. Imaginary people, children, psychics (who claim to "sense" if a house is OK) and even pets can theoretically be home inspectors. InterNACHI, the International Association of Certified Home Inspectors, front-ends its membership requirements.
InterNACHI inspectors:
have to pass InterNACHI's Online Inspector Examination, and re-take and pass it every three years (it's free and open to everyone, and free to re-take);
have to complete InterNACHI's online Code of Ethics Course (free to take after joining, and self-paced);
have to take InterNACHI's online Standards of Practice Course (free to take after joining, and self-paced);
must submit a signed Membership Affidavit;
substantially adhere to InterNACHI's Standards of Practice;
abide by InterNACHI's Code of Ethics;
have to submit four mock inspection reports to InterNACHI's Report Review Committee (for free) before performing their first paid home inspection for a client if the candidate has never performed a fee-paid home inspection previously;
within the first year of membership, have to successfully pass the following free online, accredited, and self-paced courses and exams:
InterNACHI’s "Safe Practices for the Home Inspector" course,
InterNACHI’s "25 Standards Every Inspector Should Know" course,
InterNACHI’s "Residential Plumbing Overview for Inspectors" course,
InterNACHI’s "How to Perform Residential Electrical Inspections" course,
InterNACHI’s "How to Perform Roof Inspections" course,
InterNACHI’s "How to Inspect HVAC Systems" course,
InterNACHI’s "Structural Issues for Home Inspectors" course,
InterNACHI’s "How to Perform Exterior Inspections" course,
InterNACHI’s "How to Inspect the Attic, Insulation, Ventilation and Interior" course,
InterNACHI’s "How to Perform Deck Inspections" course,
InterNACHI’s "How to Inspect for Moisture Intrusion" course, and
InterNACHI’s "How to Inspect Fireplaces, Stoves, and Chimneys" course.
have to pursue inspection-related training by taking 24 hours of additional accredited Continuing Education each year;
have to maintain their Online Continuing Education Log (free), per InterNACHI's rigorous Continuing Education policy;
have access to InterNACHI's Message Board for exchanging information and tips with colleagues and experts;
have access to InterNACHI's "What's New" section so that they can keep up with the latest news and events in the inspection industry;
have access to InterNACHI's time-tested Inspection Agreement, which keeps them (and you) away from lawsuits;
have access to InterNACHI's Report Review/Mentoring Service;
have to carry E&O Insurance (if their state requires it);
have access to a real estate agent Hold-Harmless Clause;
and have access to many other benefits, training, marketing tools and information to help themselves, as well as consumers and real estate professionals, provided for free by the world's largest inspector association.
So, the next time you need a home inspector (or need to refer your clients to one), make sure that inspector is a member of InterNACHI. 

Home Insurance Tips

Why You Need Homeowner's Insurance


The largest, single investment most consumers make is in their homes. The consumer can protect their home, possessions, and liability with a homeowner's insurance policy. The homeowner's insurance policy is a package policy that combines more than one type of insurance coverage in a single policy. There are four types of coverages that are contained in the homeowner's policy: dwelling and personal property; personal liability; medical payment; and additional living expenses.
 
Property Damage Coverage
Property damage coverage helps pay for damage to your home and personal property. Other structures, such as a detached garage, a tool shed, and any other building on your property are usually covered for 10% of the amount of coverage on your house.
 
Personal property coverage will pay for personal property, including household furniture, clothing, and other personal belongings. The amount of insurance coverage is usually 50% of the policy limit on your dwelling. The coverage is also limited by the types of loss listed in the policy. The coverage only pays the current cash value of the item destroyed, unless you purchase "replacement cost" coverage. Your homeowner's policy also provides off-premises coverage. This means that the policy covers your belongings against theft even when they are not inside your home.
 
Personal Liability Coverage
Homeowners' policies provide personal liability coverage that applies to non-auto accidents on and off your property if the injury or damage is caused by you, a member of your family, or your pet. The liability coverage in your policy pays both for the cost of defending you and paying for any damages that a court rules you must pay. Liability insurance does not have a deductible that you must meet before your insurer begins to pay losses. The basic liability coverage is usually $100,000 for each occurence. You can request higher limits that are available for an additional cost.
 
Medical Payment Coverage
 
Medical payment coverage pays if someone outside your family is injured at your home, regardless of fault. This includes payment for reasonable medical expenses incurred within one year from the date of loss for a person who is injured in an accident in your home. The coverage does not apply to you and members of your household. The medical-payments portion of your homeowner's policy will also pay if you are involved in the injury of another person away from your home in some limited circumstances. Medical payments coverage limits are generally $1,000 for each person.
 
Additional Living Expenses
If it is necessary for you to move into a motel or apartment temporarily because of damage caused by a peril covered in your policy, your insurance company will pay an amount up to 20% of the policy limit on your dwelling for these expenses. If you move in temporarily with a friend or relative and do not have any extra expenses, you will not be paid any addditional living expenses by your insurance company.
 
Home Business
If you operate a home business full- or part-time, you might be uninsured and not realize it. Many home business owners believe that their homeowner's insurance policy covers all of their home business needs. You should not assume that your homeowner's insurance policy will cover your home business. Your homeowner's policy may provide coverage, but probably only a maximum of $2,500 for business equipment in the home, and $250 away from the premises.
 
 
The price you pay for your homeowner's insurance can vary by hundreds of dollars, depending on the insurance company you buy your policy from. Here are some things to consider when buying homeowner's insurance.
 
1. Shop around.
It will take some time, but could save you a good sum of money. Ask your friends, check the Yellow Pages, and contact your state insurance commission. The National Association of Insurance Commissioners has information to help you choose an insurer in your state, including complaints that are filed by consumers. States often make information available on typical rates charged by major insurers, and many states provide the frequency of consumer complaints by company. Also check consumer guides, insurance agents, companies, and online insurance quote services. This will give you an idea of price ranges and tell you which companies have the lowest prices. But don't consider price alone. The insurer you select should offer a fair price and deliver the quality of service you would expect if you needed assistance in filing a claim. So, in assessing service quality, use the complaint information from state regulatory agencies and talk to a number of insurers to get a feeling for the type of service they provide. Ask them what they would do to lower your costs. When you've narrowed the field to three insurers, get price quotes.
 
2. Raise your deductible.
Deductibles are the amount of money you have to pay toward a loss before your insurance company starts to pay a claim, according to the terms of your policy. The higher your deductible, the more money you can save on your premiums. Nowadays, most insurance companies recommend a deductible of at least $500. If you can afford to raise your deductible to $1,000, you may save as much as 25%. Remember, if you live in a disaster-prone area, your insurance policy may have a separate deductible for certain kinds of damage. If you live near the coast in the East, you may have a separate windstorm deductible; if you live in a state vulnerable to hailstorms, you may have a separate deductible for hail; and if you live in an earthquake-prone area, your earthquake policy has a deductible.
 
3. Don’t confuse what you paid for your house with rebuilding costs.
The land under your house isn't at risk from theft, windstorm, fire and the other perils covered in your homeowner's policy. So don't include its value in deciding how much homeowner's insurance to buy. If you do, you will pay a higher premium than you should.
 
4. Buy your home and auto policies from the same insurer.
Some companies that sell homeowner's, auto and liability coverage will take 5% to 15% off your premium if you buy two or more policies from them. But make certain this combined price is lower than buying the different coverages from different companies.
 
5. Make your home more disaster-resistant.
Find out from your insurance agent or company representative what steps you can take to make your home more resistant to windstorms and other natural disasters. You may be able to save on your premiums by adding storm shutters, reinforcing your roof, and buying stronger roofing materials. Older homes can be retrofitted to make them better able to withstand earthquakes. In addition, consider modernizing your heating, plumbing and electrical systems to reduce the risk of fire and water damage. Even small measures, such as keeping a fire extinguisher in your kitchen, will often qualify you for a discount on your premiums and save you money in the long run.
 
6. Improve your home security.
You can usually get discounts of at least 5% for a smoke detector, burglar alarm and dead-bolt locks. Some companies offer to cut your premium by as much as 15% to 20% if you install a sophisticated sprinkler system and a fire and burglar alarm that rings at the police, fire or other monitoring stations. These systems aren't cheap, and not every system qualifies for a discount. Before you buy such a system, find out what kind your insurer recommends, how much the device would cost, and how much you'd save on premiums.
 
7. Seek out other discounts.
Companies offer several types of discounts, but they don't all offer the same discount or the same amount of discount in all states. For example, since retired people are at home more than working people, they are less likely to be burglarized and may spot fires sooner, too. Retired people also have more time for maintaining their homes. If you're at least 55 years old and retired, you may qualify for a discount of up to 10% at some companies. Some employers and professional associations administer group insurance programs that may offer a better deal than you can get elsewhere.
 
8. Maintain a good credit record.
Establishing a solid credit history can cut your insurance costs. Insurers are increasingly using credit information to price homeowners' insurance policies. In most states, your insurer must advise you of any adverse action, such as a higher rate, at which time you should verify the accuracy of the information on which the insurer relied. To protect your credit standing, pay your bills on time, don't obtain more credit than you need, and keep your credit balances as low as possible. Check your credit record on a regular basis, and rectify any errors promptly so that your record remains accurate.
 
9. Stay with the same insurer.
If you've kept your coverage with a company for several years, you may receive a special discount for being a long-term policyholder. Some insurers will reduce their premiums by 5% if you stay with them for three to five years, and by 10% if you remain a policyholder for six years or more. But make certain to periodically compare this price with that of other policies.
 
10. Review the limits in your policy and the value of your possessions at least once a year.
You want your policy to cover any major purchases or additions to your home. But you don't want to spend money for coverage you don't need. If your five-year-old fur coat is no longer worth the $5,000 you paid for it, you'll want to reduce or cancel your floater -- defined as extra insurance for items whose full value is not covered by standard homeowners' policies, such as expensive jewelry, high-end computers and valuable art work -- and pocket the difference.
 
11. If you are in a government plan, look for private insurance.
If you live in a high-risk area -- say, one that is especially vulnerable to coastal storms, fires or crime -- and have been buying your homeowner's insurance through a government plan, you should check with an insurance agent or company representative, or contact your state commission of insurance for the names of companies that might be interested in your business. You may find that there are steps you can take that would allow you to buy insurance at a lower price in the private market.
 
12. When you’re buying a home, consider the cost of homeowner's insurance.
You may pay less for insurance if you buy a house close to a fire hydrant or in a community that has a professional rather than a volunteer fire department. It may also be cheaper if your home’s electrical, heating and plumbing systems are less than 10 years old. If you live in the East, consider a brick home because it's more wind-resistant. If you live in an earthquake-prone area, look for a wooden frame house because it is more likely to withstand this type of disaster. Choosing wisely could cut your premiums by 5% to 15%.
 
Check the CLUE (Comprehensive Loss Underwriting Exchange) report of the home you are thinking of buying. These reports contain the insurance-claim history of the property and can help you judge some of the problems the house may have. Remember that flood insurance and earthquake damage are not covered by a standard homeowner's policy. If you buy a house in a flood-prone area, you'll have to pay for a flood insurance policy that costs an average of $400 a year. The Federal Emergency Management Agency (FEMA) provides useful information on flood insurance on its Web site at www.fema.gov/nfip. A separate earthquake policy is available from most insurance companies. The cost of the coverage will depend on the likelihood of earthquakes in your area.
 
If you have questions about insurance for any of your possessions, be sure to ask your agent or company representative when you're shopping around for a policy. For example, if you run a business out of your home, be sure to discuss coverage for that business. Most homeowners' policies cover business equipment in the home, but only up to $2,500, and they offer no business liability coverage. Although you want to lower your homeowner's insurance cost, you also want to make certain you have all the coverage you need.
 
Common Questions Asked by Homeowners About Insurance
If a fire, flood, earthquake, or some other natural disaster were to damage or destroy your home, would you have the right insurance coverage to rebuild your house? Based on the questions consumers ask most frequently, this list explains what is and is not covered in a standard homeowner's policy. Where gaps in coverage exist, it tells you how to fill them. To simplify explanations, assume that you have a policy known as Homeowners-3 (HO-3), the most common type of homeowner's policy in the United States. Find out what type of homeowner's policy you have. If you have a different policy, you should review your options in question #17.
1. Am I covered for direct losses due to fire, lightning, tornadoes, windstorms, hail, explosions, smoke, vandalism and theft?
Yes. The HO-3 provides broad coverage for these and other disasters or “perils,” as they are called in the policy, including all those listed in the question. You should check the dollar limits of insurance in your policy, and make sure you are comfortable with the amount of insurance you have for specific items. Also, if you live near the Atlantic or Gulf Coasts, there may be some restrictions on your coverage for wind damage. Ask your agent about windstorm/hurricane deductibles. In areas prone to hailstorms, you may have a specific hail-damage deductible.
 
2. Are my jewelry and other valuables covered?
The standard policy provides only from $1,000 to $2,000 for theft of jewelry. If your jewelry is worth a lot more, you should purchase higher limits. You may wish to add a floater to your policy to cover specific pieces of jewelry and other expensive possessions, such as paintings, electronic equipment, stamp collections and silverware, for example. The floater will provide both higher limits and protect you from additional risks not covered in your standard policy.
 
3. If my house is totally destroyed in a fire and I have $150,000 worth of insurance to cover the structure, will this be enough to rebuild my home?
If the cost of rebuilding your home is less than or equal to $150,000, you would have enough coverage. The HO-3 policy pays for structural damage on a replacement-cost basis. If the cost of replacing your home is, say, $120,000, then that is all the insurance you need. On the other hand, if the cost of rebuilding your home is $180,000, then you will be short $30,000.
 
If you live in an area that is frequently hit by major storms, ask your insurance company about an extended or guaranteed replacement-cost policy. This will provide a certain amount over the policy limit to rebuild your home, so that if building costs go up unexpectedly due to high demand for contractors and materials, you will have the extra funds to cover the bill.
 
If you choose not to rebuild your home, you will receive the replacement cost of your home, less depreciation. This is called "actual cash value." You should make sure that the amount of insurance you have will cover the cost of rebuilding your house. You can find out what this cost is by talking to your real estate agent or builders in your area.
 
Do not use the price of your house as the basis for the amount of insurance you purchase. The market price of your house includes the value of the land on which the house sits. In almost all cases, the land will still be there after a disaster, so you do not need to insure it. You only need to insure the structure.
 
4. Am I automatically covered for flood damage?
No. If you live in a flood-prone area, it may be wise to purchase flood insurance. Flood insurance is provided by the federal government under a program run by the Federal Insurance Administration. In some parts of the country, homes can be damaged or destroyed by mudslides. This risk is also covered under flood policies. Contact your agent or company representative to get this insurance, or call the FEMA at 1-800-427-4661 or visit www.fema.gov.
 
5. If a pipe bursts and water flows all over my floors, am I covered?
Yes. The HO-3 covers you for accidental discharge of water from a plumbing system. You should check your plumbing and heating systems once a year. While you are covered for damage, who needs the mess and hassle?
 
6. What if water seeps into my basement from the ground -- am I still covered?
No. Water seepage is excluded under the HO-3. And if the water seepage is not due to a flood, you will not be covered under a flood policy. Seepage is viewed as a maintenance issue and is not covered by insurance. You should see a contractor about waterproofing your basement.
 
7. Am I automatically covered for earthquake damage?
No. Earthquake coverage is sold as additional coverage to the homeowner's policy. To find out whether you should buy this insurance, talk to your agent or company representative. The cost of this coverage can vary significantly from one area to another, depending on the likelihood of a major earthquake.
 
 
8. A neighbor slips on my sidewalk or falls down my porch steps and threatens to take me to court for damages. Does my policy protect me?
 
Yes. The policy will pay for damages if a fall or other accident on your property is the result of your negligence. It will also pay for the legal costs of defending you against a claim. Also, the medical-payments part of your homeowner's policy will cover medical expenses if a neighbor or guest is injured on your property. You should check to see how much liability protection you have. The standard amount is $100,000. If you feel you need more, consider purchasing higher limits.
 
 
9. A tree falls and damages my roof during a storm. Am I covered?
Yes. You are covered for the damage to your roof. You are also covered for the removal of the tree, generally up to a limit of $500. You should cut down dead or dying trees close to your house and prune branches that are near your house. It's true that your insurance covers damage, but falling trees and branches can also injure your family. Ask your InterNACHI inspector about problem trees during your next inspection.
 
 
10. During a storm, a tree falls but does no damage to my property. Am I covered for the cost of removing the tree?
 
Your trees and shrubs are covered for losses due to risks such as vandalism, theft and fire, but not wind damage. However, if a fallen tree blocks access to your home, you may be covered for its removal. Decide if you need extra insurance for the trees, plants and shrubs on your property. You may be able to purchase extra insurance which will not only cover the cost of removing fallen trees, but will also cover the cost of replacing trees and other plants.
 
 
11. If a storm causes a power outage and all the food in my refrigerator and freezer is spoiled and must be thrown out, can I make a claim?
The general answer is no. However, there are a number of exceptions. In some states, food spoilage is covered under the homeowner's policy. In addition, if the power loss is due to a break in a power line on or close to your property, you may be covered. You should check with your agent to find out whether you are covered for food spoilage in your state. If not, you can add food-spoilage coverage to your policy for an additional premium.
 
 
12. My children are away at college. Are they covered by my homeowner's insurance?
If they’re full-time college students and part of your household, your insurance generally provides some coverage in a dorm, typically 10% of the contents' limit. If they live off-campus, some companies may not provide this limited coverage if the apartment is rented in the student’s name.
 
 
13. My golf clubs were stolen from the trunk of my car. Does my homeowner's policy cover the loss?
Yes. The HO-3 covers your personal property while it is anywhere in the world. However, if your golf clubs are old, you will get only their current value, which may not be enough to purchase a new set. Consider buying a replacement-cost endorsement for your personal property. This way, you will get what it costs to replace the golf clubs, less your deductible.
 
14. I have a small power boat. If it is stolen, am I covered? What if there is a boating accident and I get sued? Am I covered for that?
Whether or not you are covered for either theft or liability depends on the size of the boat, the horsepower of the engine, and your insurance company. Coverage for small boats under homeowners' policies varies significantly. Ask your insurance representative whether you need a boat owner's policy.
 
15. My house is close to the ocean. I’ve heard that if it is destroyed by the wind, the town's new building code requires me to rebuild the house on stilts. This will add $30,000 to the cost of rebuilding my house. Am I covered for this extra cost?
No. The HO-3 excludes costs mandated by ordinances and laws that regulate the construction of buildings. You can purchase an ordinance or law endorsement. This will cover the extra costs involved in meeting new building codes.
 
 
16. Am I covered for “acts of God”?
Sometimes. The term “acts of God” is not specifically mentioned in homeowners' insurance policies. It usually refers to natural disasters, such as hurricanes and tornadoes, as opposed to man-made acts, such as theft and auto accidents. Some natural disasters, such as damage from windstorms, hail, lightning, and volcanic eruptions, are covered under homeowner's insurance. Damage from floods and earthquakes is not.
 
 
17. What should I do if my policy provides less coverage than the HO-3?
Review your coverage with your agent. Some older policies provide less coverage than the HO-3. They may not provide coverage for water damage, theft or liability. They may also provide coverage for the house on an actual cash-value basis, rather than a replacement-cost basis.
 
"Actual cash value" means replacement cost less depreciation. For example, if your roof is destroyed in a storm, the insurance will pay only for the cost of a new roof less the amount of depreciation of the old roof. If your roof was in great shape, this deduction will not be large. However, if the roof was old and worn out, the deduction for depreciation may be significant. You should try to get an HO-3.

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