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Home Inspection Clause & Mold Inspection Clause

Q : What does an inspection rider provide?

A : The inspection rider is a very important safeguard for the buyer. Two types are commonly used. The inspection rider first gives the buyer the right to have the property inspected by a professional home inspector of the buyer's choice and at the buyer's expense. If the inspector finds defects, the buyer has the right to cancel the contract within a specified time. This type of rider raises some of the same issues as an unrestricted attorney-approval rider, since inspectors often find problems in homes. Thus, it can give buyers a few extra days to decide whether they want to follow through with the purchase.

The second type of inspection rider gives the seller time to either repair any problems uncovered by the inspection or agree to reduce the selling price contained in the contract by the cost of repairs. If a seller opts to do nothing, he or she must inform the buyer. Unless the buyer and seller can come to terms based on the buyer's inspection report, the buyer can cancel the contract and seek return of any earnest money previously paid.

Some people prefer the first inspection rider described above. Although it is open to occasional abuse by fickle buyers, its simplicity generates fewer back-and-forth discussions between the buyer and seller. If there is a serious problem and the seller really wants to sell, the parties usually can make a new deal.

Still, the choice is yours. Just remember that a real estate purchase contract is no different in principle than any other contract its terms are negotiable. By using properly drafted riders, you may quickly turn a form contract into one that deals with your personal concerns.