How are Home Inspectors Regulated?

There is a mixture of excitement and a bit of anxiety when purchasing a home. Paperwork, loan qualifications, purchase offers, and the escrow process all need to be navigated with a keen eye for detail. Add to this the maintenance and repair responsibilities that home ownership requires, and it’s easy to feel overwhelmed.

With this in mind, the importance of a home inspection prior to purchase cannot be overstated. A thorough examination of a home’s condition can make or break a home sale and is a primary contingency for many mortgage lenders – issues such as a poor foundation or damaged roof can seriously alter the course of the deal when uncovered. Real estate agents and brokers often have specific home inspectors they’ve successfully worked with in the past. However, it’s important for both the buyer and seller to understand how home inspectors are regulated in the specific U.S. state where the property is located.

Research Your State's Rules

Each state has individual requirements for the training and certification for home inspectors. Some states, such as California, do not require a home inspector to be licensed. This does not mean, however, that home inspectors are free from regulation. In fact, the California Trade Practices Act (Chapter 338) expressly regulates home inspection activities. Furthermore, the California Contractors State License Board has oversight regarding home inspectors.

In contrast, home inspectors in states such as Nevada are required to be licensed through the Real Estate Division of the Department of Business & Industry. To earn a license, potential Nevada home inspectors must have:

  • 40 hours of education
  • 25 hours of inspections observed by a certified general or master inspector
  • Passed a background check
  • Passed a standardized exam
  • Provided proof of insurance
  • Paid a $350 licensing fee

Furthermore, Nevada home inspectors must renew their license every two years and submit evidence of 20 hours of continuing education (including three hours of safety and two hours of law).

What if There are No State Licensing Requirements?

If you reside in a state where there is no licensing requirement, and home inspectors are solely regulated by consumer protection laws, there are several ways for you to determine if the proposed inspector is reputable.

  1. Ask if they are licensed and through whom. Just because some states don’t require home inspection licensing doesn’t mean there aren’t reliable licensing organizations in the state. At the very least, a licensed contractor has exhibited good faith effort to learn their craft through formalized education and qualify for the license through examination.
  2. Ask how much inspection experience the home inspector has. Make sure they have home inspection experience, specifically.
  3. Ask if the home inspector has references from other home buyers/sellers in the past.
  4. Ask if they have a sample report to show you. This will help you determine how detailed and comprehensive they are. Also, ask for them to explain a few things to you from the sample report. It’s important to know if they’re willing to take the time to clarify any questions you may have.
  5. Perform a Google search to see if they have reviews. People tend to make an effort to post a review for one of two reasons. First, when they receive excellent service, and second, when they receive poor service (although you will want to see if these are valid complaints). Therefore, a home inspector with consistent five star ratings is likely to have provided great service to their clientele. Of course, home inspectors in smaller cities may be known by word of mouth. Additionally, research their licensing organization – especially if you live in a state where licensing isn’t required.
  6. Ask family and friends for a reference. If, per chance, someone close to you has recently bought or sold a home, they may be the most help in finding a trusted home inspector.

When inspecting a home for sale in Austin, Texas, buyers should be aware that their inspector should be licensed and meet many other requirements such as having adequate insurance coverage. For additional information regarding the regulatory bodies and licensing requirements of each state, The ASHI School’s website provides a state by state overview.

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