Why a Property Inspection on an Investment Property is a Must
Having an inspection done on the Investment Property is a must. There are two types that should always be done before purchasing the property.
- Home
- Termite – CL100
Home Inspections look at all aspects of the structure
- Framing (structure)
- Roof and attic
- Foundation and/or Crawlspace
- Walls
- Electrical system
- Plumbing system
- Heating and air conditioning systems
- Kitchen
- Bathrooms
- General condition of the structure
- Landscaping with regards to how it affects the structure
Property inspections are limited because they can not see behind walls, but they can note defects that may need further scrutiny by a contractor, structural engineer, etc.
The wood infestation report (also known as a CL-100) may be required by your lender in order to obtain a mortgage on the property. Most lenders today require a “clear” (termite-free) CL-100 as a condition of the mortgage. The termite professional will note in the inspection if there are active termites and, also of importance, if there are any excessive moisture conditions anywhere in the property. Moist conditions may lead to future termites or fungal outbreaks. Both the presence of termites and the presence of moisture can be obstacles that need to be addressed and rectified but, neither has to be a deal breaker. Termites can be eradicated if infestations are caught early and damage, if any has occurred, can be repaired. Moisture is a little bit trickier but, also can be managed with direction from a licensed contractor. It’s great if there is a transferable termite bond in place on the property. However, if there isn’t one, the cost of obtaining one, prior to closing, could be negotiated for you by your real estate agent such that the seller pays for the bond.
The importance of thoroughly scrutinizing the property can not be stressed enough. Catching troubles before closing on the property may save expensive fixes and headaches that would have been otherwise handled by and paid for by the previous owner.
