Buying a home can be one of the most important financial investments you will ever make. But, how do you know if the house is everything it appears to be? If the home you are about to purchase does not have the structural integrity, safe wiring or properly operating plumbing to give you peace of mind, you may be buying into a money pit and sleepless nights. A home inspection is one of the smartest ways to educate yourself about the physical condition of a property you want to buy.
A home inspection is a visual inspection of the physical structure and mechanical condition of a home, from roof to foundation. The inspection is designed to identify problems that may exist, advise of repairs needed and, in some cases, provide preventive maintenance advice. A home inspection points out the positive aspects of a home, as well as the maintenance that will be necessary to keep it in good condition.
Currently, home inspectors are not regulated by any federal government agencies but must adhere to the Pennsylvania Home Inspector Law – ACT 114. Warren King, president of the BBB announces a new “Start with Trust” initiative to alert consumers and real estate professionals as to how to identify compliant home inspection businesses. This program is being promoted in conjunction with the Pittsburgh Regional Organization of the American Society of Home Inspectors (PRO-ASHI).
“The scary part of this is that most consumers assume that they can safely rely on home inspectors to advise them about one of the largest purchases they may make in their life,” states King. “The common perception is that if a hair stylist needs to have a license, a home inspector must have one too.”
Below are some of the key provisions of the Home Inspector Law:
- The Inspector must carry both Liability and Errors & Omissions Insurance
- An inspector is not permitted to provide a copy of the report to any other parties without their consent
- Upon request, buyer must provide seller with a copy of the report
- Cost of repairs is not permitted in inspection reports except in limited conditions
- Inspectors are banned for 12 months from performing paid repairs at properties they inspected
- Inspectors must disclose any financial interest in the sale of the home and are not permitted to compensate realtors for referrals
- Inspectors must attend continuing professional education classes and be a full member in good standing of a national, not-for-profit home inspection association
Act 114 has been in effect since Dec 20, 2001 with limited enforcement action being taken. According to Pennsylvania Home Inspectors Council (P.H.I.C.), as many as 40% to 60% of PA Home inspectors are not compliant with the Home Inspector Law.
Failure to maintain the required association membership, continuing education and insurance can lead to severe penalties. The law provides that a District Justice can conduct a summary proceeding and levy the following penalties. Violations of the insurance provisions or reliance of the buyer the first offense can be fined no more than $500, imprisonment of no more than 3 months or both. For the second and subsequent offense, the fine shall be more than $2,000 and less than $5,000 and for imprisonment of no less than 1 year and no more than 2 years or both. Other punishable offenses include a failure to maintain confidentiality for the buyers.
The real purpose of a home inspection is to keep residents safe and protect the major investment that a home represents. The sad news is that errors can occur by both overstating and missing problems. Without proper training an inspector may miss identifying a defect, or on the other side, identify something that is not a defect as a defect. If either party suspects a mistake, it is appropriate to inspect the inspector. If the inspector is not compliant, the inspection is not valid. If the inspector does not have insurance, you could own "the money pit" and have no recourse. PRO-ASHI president, Brian Mishler, recently came across a situation where a buyer unknowingly had a non-compliant inspector included on a realtor office list perform their inspection. When the non-compliance was discovered, the time allowed in the sales contract had passed and the buyer lost their rights to request repairs under the contract.
Always verify that the home inspector you hire is in compliance with the law by requesting copies of their current certificates of insurance, that they are a member in good standing of a national, not-for-profit home inspection association and that they adhere to the requirements set forth in the Pennsylvania Home Inspector Law. The BBB provides the information and links to check your home inspector at www.bbb.org or helpful information is available through PR0-ASHI at www.pro-ashi.com.
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About the BBB
BBB is an unbiased organization that sets and upholds high standards for fair and honest business behavior. Businesses that earn BBB accreditation contractually agree and adhere to the organization’s high standards of ethical business behavior. BBB provides objective advice, free business BBB Reliability ReportsTM and charity BBB Wise Giving ReportsTM, and educational information on topics affecting marketplace trust. To further promote trust, BBB also offers complaint and dispute resolution support for consumers and businesses when there is difference in viewpoints. The first BBB was founded in 1912. Today, 128 BBBs serve communities across the U.S. and Canada, evaluating and monitoring more than 3 million local and national businesses and charities. Please visit www.bbb.org for more information about the BBB.
PRO-ASHI is the Pittsburgh Regional Chapter of the American Society of Home Inspectors. Members of the association must adhere to the ASHI Code of Ethics and maintain annual continuing education and carry errors and omissions insurance. Home inspections are conducted to the ASHI Standards of Practice. PRO-ASHI confirms and maintains PA Act 114 compliance of the members listed on their website . For more information, interviews or topics available from their speakers bureau, contact PR representative, Dan Howard at Info@PRO-ASHI.com or (724) 295-9703. Please visit www.PRO-ASHI.com for more information about PRO-ASHI.