Negotiating home inspection problems can be a sizable part of a real estate transaction. If you’ve found your dream home in the ideal location, even if it has major problems, it may not be possible to just walk away. How can you get the upper hand in the negotiations? With knowledge! Come read Part 2 of Luke and Vanessa’s story, and learn how to negotiate when there are home inspection problems.
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NEGOTIATING HOME INSPECTION PROBLEMS – LUKE AND VANESSA’S STORY
If you read Part 1 of our story, you already met Luke and Vanessa. Luke works for a major company in sales, and Vanessa works part-time from home. Luke and Vanessa (Nessa) were in the market for a new home because their family would soon be expanding. Nessa was expecting their third child, and they were already feeling the crunch of not having enough space.
Luke and Nessa found their dream home, put in an offer, and their offer was accepted. They were ecstatic! The kids loved the big yard and were excited to move.
Now that their due diligence period had begun, Luke contacted the home inspection service suggested by their real estate agent. Unfortunately, they were shocked at what the home inspector found.
There were several major problems with the home. Inside the crawlspace, there was standing water, and even water lines on the concrete suggesting higher water levels. There was also mold growing on the floor joists and subfloors. The bank would not finance the sale, due to the standing water and mold in the crawlspace. The family was devastated.
What do we do now? Options for Negotiating Home Inspection Problems
“This is our dream home! Do we have any options?” Luke and Vanessa talked to their real estate agent, and explained how important this particular home was to them. In our previous post, we discussed the 3 options their real estate agent presented to them including:
- Option 1: Walk away. (Unacceptable! They wanted this home!)
- Option 2: Ask the homeowner to fix the damage and keep the offer for home the same. (Unfortunately, the homeowner was unwilling to make repairs.)
- Option 3: “Contact the bank to find out if you can qualify for a Renovation Loan,” their agent told them. “Then, contact a company to perform a mold inspection and get an estimate for the cost of the repairs. After that, we can lower your offer to accommodate the cost of the repairs after the sale, and then we just have to wait and see if they will accept your offer.”
Luke and Nessa carefully considered all their options, but decided that Option 3 was their best choice. Luke contacted their bank and talked to the loan officer about a loan to cover the renovations. Then, he called us (Branch Environmental) to schedule a comprehensive mold inspection.
Comprehensive Mold And Air Quality Inspection
Our inspector not only saw the water damage in the crawlspace, but several other problems. Our inspector checked the entire house top to bottom, inside and out. There were other problems with this home that the home inspector missed.
You see, mold inspections are different from home inspections. While most home inspectors will report mold they see through the course of their inspection, they aren’t going to go out of their way to find it. Most buyers are unaware that home inspectors are not legally required to report mold in Georgia.
Mold is sneaky and can hide in very small spaces like behind cabinets, in crawl spaces, and in attic corners. Here at Branch Environmental, we check from crawl space to attic to everything in between. Our inspector created a comprehensive mold inspection report with photographs for Luke and Nessa detailing all the problems with the home. An estimate for the repairs was given to Luke and Nessa with the mold inspection report.
Inspection Report Findings – What needs to be fixed?
Luke and Nessa knew about the water in the crawl space, but not where the water was coming from or how to stop it. They also knew there was some mold, but not how extensive it was. Keep reading to find out about problem #2-3 for this home, and check in with our blog next week to find out if they got their dream home. (To see problem #1 (water in the crawl space) and how they solved it, check out our post from last week: Home Inspection Problems – Luke and Vanessa’s Story, Part 1).
Problem #2 – Drain Line Condensation and Mold
The HVAC drain line in the attic was causing mold to grow on the plywood below the unit. In the attic, cold water flows through from the HVAC unit through the pipe. When the hot attic air touches it condensation can form. So, even though it wasn’t technically a leak, the drain line drips condensation from the pipe. The dripping condensation caused mold to grow on the wood.
Drain lines are rarely, if ever, insulated. However, in this case, the line should be insulated to prevent condensation on the pipe and future mold growth. The mold in the area should also be cleaned and removed.
Problem #3 – Insulation Missing on HVAC Ducts causing mold growth
In the attic and crawl space, the insulation for the HVAC system was missing around the duct boots (which allow air into the home). These may not have been insulated when the home was built. It’s much more difficult to insulate duct boots than it is to insulate the pipe itself. This can lead to HVAC contractors cutting corners, and only insulating the main pipes.
Some of the mold in the crawl space and in the attic was caused by the missing insulation. The mold results from the missing duct boot insulation because the cold air within the duct makes the metal duct boot cold, approximately 55 degrees. This cold metal is surrounded by warm and humid air, so condensation forms. This condensation is then absorbed by the surrounding subfloor or ceiling and becomes a moisture source for mold growth.
To fix the problem, the mold should be cleaned and all ducts and duct boots should be insulated. Then, all the protrusions into the home including wire, pipe, and duct penetrations should be sealed to prevent ‘dirty air’ from entering the home and the breathing area of the home.
NEGOTIATING HOME INSPECTION PROBLEMS – WILL LUKE AND NESSA GET THEIR DREAM HOME?
The problems above were only part of the problems with this home! An estimate for all the repairs was given to Luke and Nessa with the mold inspection report.
Now that Luke and Nessa had the estimate for repairing all the damages, they renegotiated with the seller. They requested that the seller pay for the gutter extensions and gutter cleaning in the contract. They also lowered the price they were willing to pay for the home based on the estimate for the repairs. Their agent sent the owner a revised contract, and they waited.
Come check out our Education Center Blog to learn more about this home’s problems and to find out what happens next!
NEGOTIATING HOME INSPECTION PROBLEMS – WHY YOU WANT A COMPREHENSIVE MOLD AND AIR QUALITY INSPECTION FOR YOUR HOME PURCHASE
A comprehensive mold and indoor air quality inspection (like ours) gives you different information than a home inspection. Mold usually forms when there is a moisture problem or leak, but as you can see this week, condensation can also cause mold problems.
Once the leak or water intrusion is stopped and moisture is gone, the mold will not continue to grow. However, the mold will still be there, and spores will release and become airborne. Airborne spores can go anywhere the air moves them, including all over your home! The only way to stop the mold is to remove it.
Knowledge is Power!
Including a comprehensive mold and indoor air quality inspection as part of your due diligence package is money well spent. Knowledge is power! You now have the power in the negotiations with the seller, armed with the inspection report knowledge. You gain the knowledge you need to make a good decisions about purchasing the home you want.
If the home has mold, you could choose to walk away. But if it’s your dream home in the ideal location, that could be very difficult! What you might be willing to pay for the home now and its appraisal value may change, now that mold is a problem. Sometimes lenders will not allow you to purchase the home without fixing the mold issues first.
Everything is negotiable once you have the knowledge. You could ask the seller to remediate and repair the property. You could also negotiate a lower price for the home, so that you could have the remediation and reconstruction performed yourself. Knowing what needs to be remediated and repaired, and how much it will cost, makes a big difference!
Especially if you live outside our service area, check out our post: How to Choose the Best Mold Removal Company. We let you know what you should expect and what the industry standards should be. If the company you interview doesn’t know the answer to the questions in our article, you don’t want to hire them!
THE BRANCH DIFFERENCE
Call Branch Environmental. We’re experts not only at mold removal, but at determining and remediating the underlying causes. From hidden mold sources to major contaminants, we can identify exactly what is going on in your home and rid it of environmental toxins, often for good.