Buying a home is one of the biggest decisions you’ll ever make. For most buyers, it’s not just about finding a dream home, but making sure that dream doesn’t turn into a financial nightmare. That’s where the home inspection process comes in.
A thorough home inspection gives you an inside look at the condition of a property before the sale becomes final. While the house might seem perfect during a walkthrough, it could have hidden issues that cost thousands to repair later. A home inspection helps buyers avoid falling in love with a house that turns out to have serious problems.
More importantly, this step is a key part of the real estate transaction process. Most purchase contracts include an inspection contingency, which gives buyers a chance to walk away if major issues are discovered. Skipping this step can be one of the biggest mistakes a buyer can make.
A Central Bank guide on home buying red flags notes that refusing an inspection, a visibly damaged roof, or signs of declining neighborhood value are major signals to pause. A home inspection lets you proceed with confidence, or change course before it’s too late.
Learn more in our Step-by-Step Home Buying Process guide.
A certified home inspector is trained to look for problems you might not notice. They perform a top-to-bottom inspection of the house, including:
Each of these systems plays a major role in the safety and comfort of the home. The home inspector will note anything that looks off; even if it’s a small issue now, it could point to a significant expense later.
To get a sense of what inspectors focus on, check out AmeriSpec’s red flags guide, which lists the most common problem areas: roofs, electrical, plumbing, mold, and outdated materials like lead paint or asbestos.
After the inspection, you’ll receive a formal inspection report: a document that details the inspector’s findings. This might be a few pages or dozens, depending on what they uncover.
The home inspection report typically includes:
For example, the report may mention broken panes on old windows, frayed wiring in an attic, or corrosion around a water heater. While not every item will be urgent, you’ll want to pay close attention to any marked as “safety hazard,” “needs repair,” or “recommend specialist evaluation.”
In some cases, a second opinion may be needed. For instance, if the inspector notes issues with the roof, they may recommend a roofer assess whether a new roof is needed.
Some sellers may offer a pre-inspection report or provide documents from a previous home inspection. While these can be helpful for general awareness, you should always hire your own inspector. Here’s why:
Home inspectors are regulated differently depending on your state, so be sure to choose a licensed professional. And remember, even a great home inspector can’t see behind walls or predict every future problem, but they can spot the biggest risks before you commit.
Once you have the inspection report, it’s time to dig into the details. The inspection findings help you figure out what’s a serious concern, and what’s not.
Big red flags include:
Even smaller problems can add up. Things like rotted trim, faulty outlets, or loose stair railings may seem minor, but if there are dozens of these issues, they suggest poor upkeep overall.
Look for any mention of:
Remember, not every item on the list is a dealbreaker, but major systems in bad shape can tip the scales.
Some home inspection red flags are more serious than others. While cosmetic issues like chipped paint or dated fixtures can be overlooked, certain problems may be expensive—or even dangerous—to live with.
Here are red flags that deserve special attention:
A Farm Bureau Financial Services guide lists mold, pest infestations, and outdated plumbing among the most common red flags in homes that become “money pits.”
While most red flags are found inside the house, don’t ignore what’s outside.
Be alert to:
It’s also worth researching the neighborhood and local zoning rules. If you’re considering adding a rental unit, accessory dwelling unit (ADU), or trying a house hacking strategy, local restrictions could impact your plans.
Sometimes a property looks like a great deal, until you add up all the repairs needed. If the list of problems grows longer with each page of the home inspection report, it may be time to take a deep breath and reconsider.
Here’s how to tell if you’re walking into a money pit:
While some buyers are comfortable with fixer-uppers, most are not prepared for the reality of unexpected repairs that can total tens of thousands of dollars.
Not all repairs are dealbreakers. Some may be worth addressing through negotiation. The key is knowing which issues are urgent, and which can wait.
Here’s what you can consider asking for:
Cosmetic or minor issues—like scuffed floors or old paint—usually aren’t worth haggling over. But when you’re facing costly fixes, it’s reasonable to ask the seller to either make the repairs, offer a price reduction, or provide a home warranty to cover near-term risks.
Your inspection report isn’t just a document; it’s a tool. You can use it to support buyer requests for seller concessions, including:
Start by reviewing the inspection findings with your real estate agent. They’ll help you prioritize what matters most and draft a clear list of items for negotiation.
Be sure to:
Negotiations may go back and forth. Be respectful but firm. This is where your earnest money is on the line, so take the time to make sure the deal truly makes sense for your budget and risk tolerance.
Sometimes sellers are unwilling or unable to fix everything. In those cases, it may be smarter to ask for a price reduction instead of repairs.
This can be a win-win:
Price reductions often make the most sense when:
Talk with your lender before finalizing this type of change. A reduced price could impact your loan terms or appraisal.
Some inspection results are just too much. Even if you’ve fallen in love with the house, certain red flags should make you think twice, or walk away entirely.
Red flags worth walking away over:
The Chase Home Lending guide offers smart advice on how to walk away strategically. If the seller won’t budge, you can request concessions, credits, or warranty support… or simply move on to the next property.
Your real estate agent should guide you through this process, helping you protect your earnest money and avoid legal pitfalls.
Some buyers approach the home inspection process as a way to get a better deal, but that’s not what inspections are meant for. A home inspection exists to help you spot significant issues, protect your safety, and confirm that the property is in the condition the seller has advertised.
Using inspection negotiations purely as a strategy to lower the price, especially when requesting credits for minor repairs, can backfire. It not only risks souring the deal, but it also undermines trust between buyer and seller. Worse, it dilutes the value of the inspection process for everyone.
The vast majority of home inspections uncover small, fixable concerns: chipped paint, loose cabinet doors, or outdated outlets. These are telltale signs of normal wear and tear, not major red flags. Trying to renegotiate based on every minor flaw can signal to the seller that the buyer isn’t acting in good faith.
Instead, focus your negotiations on issues that truly matter: health and safety concerns, code violations, or major systems in need of replacement. When buyers choose to be strategic and reasonable, it increases the chance of a successful closing.
You can—and should—request repairs for serious problems. But keep in mind that inspection negotiations should be rooted in fairness. If you truly love the home and the seller is transparent, try to maintain a respectful balance. Not every scratch on the floor needs to become a bargaining chip.
If you’re not sure how to approach inspection negotiations constructively, review our 10 First Time Home Buyer Mistakes to Avoid and Steps to Buying Your First Home: A Comprehensive Guide for more insight on how to balance negotiation with good faith.
Common problems include roof damage, HVAC issues, outdated electrical panels, and signs of water leaks. These may not be obvious during a casual tour but can become costly if left unaddressed.
Yes. In fact, most negotiations happen after the inspection. If the report uncovers serious repairs, you can ask the seller to fix them, offer a credit, or reduce the price.
Absolutely. If the inspector finds major repairs or safety hazards and the seller refuses to make concessions, you may decide to walk away.
You have several options. You can accept the home as-is, ask for a price reduction, request a home warranty, or cancel the deal if your contract has an inspection contingency.
Most inspections take 2–4 hours. You’ll get the full inspection report within a day or two.
It’s not required, but it’s a great opportunity to see the home’s condition firsthand and ask questions.
A home inspection isn’t just a formality; it’s a powerful tool to help you make smart decisions, protect your investment, and avoid costly surprises. Whether you’re buying a multifamily property, a single-family home, or an accessory dwelling unit, knowing how to interpret and act on your inspection report is essential.
Ready to learn more about negotiating repairs, reducing your interest payment, and building toward financial freedom?
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