Close the deal

Step 2: Get an appraisal and inspection

Do it yourself

Now it’s time to take action! Take the following steps to get an appraisal and an inspection.

Step-by-Step Guide:

To get an appraisal:

1. Have your lender order the appraisal.
2. Sit down and review the appraisal with your agent. Does it confirm your feelings about the price you’ve attached to your would-be property, or does it raise questions?
3. If the appraisal report states that you are in a declining market, ask your lender how they view the market, what they expect from appraisers, and what their current policy is on how much they will lend.

To get an inspection:

1. You should search for an inspector the same way you searched for realtors and lenders. Use your common sense, referrals from trusted friends, and recommendations from previous clients to find a good inspector (beware – there are so “not so good” ones out there.) Be sure that the inspector is licensed and experienced, and has had experience in your area as well as with the type of home you wish to purchase. Also, remember the most important rule when choosing an inspector: The inspector should NOT be affiliated with anyone involved in the deal, especially the seller.
2. Do research to understand what a thorough inspection entails and review exactly what the inspector is planning (or not planning) to inspect. Make sure you agree on exactly what will be covered in the inspection.
3. After the inspection you will go back to the seller to discuss the inspection results. Based on these results, you may choose to take the house “as-is” or you may choose to require repairs or even walk away from the deal altogether. Note: It’s very important to put a contingency in your purchase offer indicating that your offer is dependent on the outcome of the home inspection.

Key takeaways:

Regarding appraisals:

• Have your lender order the appraisal. They are the ones who ultimately need it anyway.
• You are legally entitled to get a copy of the appraisal.
• Sit down and review the appraisal with your agent. Does it confirm your feelings about the price you’ve attached to your would-be property, or does it raise questions?

Regarding inspections:

• Inspections usually cost under $1000. DO NOT choose to forego the home inspection. What you “save” in fees will very likely pale in comparison to repairs that you find you have to make after the home is yours.
• Do your homework: Find a reputable, independent inspector (who is not affiliated with the seller or others involved in the deal, such as the listing agent).  Make sure you understand what a thorough inspection entails, and make sure your inspector does a thorough inspection. You may very well pay for any problems the inspector misses, so don’t be afraid to look over his or her shoulder and ask questions before, during and after the inspection.