What is a home inspection?
A home inspection should be performed by a licensed, bonded, insured (errors & omissions) licensed contractor or qualified
(by the state) inspector.
Home inspection rates vary by company. Some companies an amount based on the square footage of the property as well as the age of the home. For instance, a home with 2001 to
2500 square feet built in 1992 might cost $350. Condominiums and townhouses usually cost less.
The home inspector should provide you with information prior to inspecting the home as to what he or she covers. But here are a few items home inspectors should address:
Structural:
Although inspectors aren’t structural engineers,
they can identify visual defects in the areas requiring immediate repairs. They will examine the ceilings, windows, roof, floors, cabinets…
Electrical:
Do the outlets in the property work properly? Is
the breaker box work correctly and the present GFCIs work?
Plumbing:
Are the toilets affixed correctly, working and
not leaking? Do any of the sinks drip?
Built-in appliances:
Are the appliances functioning correctly?
Inspectors usually do not examine cosmetic features of the home thus if wallpaper is pealing, they will not comment on this. Per the South Carolina Residential Purchase Agreement, a home inspection is performed to see if the heating system, air conditioning, plumbing and electrical systems are in operative condition and to make sure the roof is free of leaks and the dwelling
is structurally sound.
I highly recommend you have a home inspection on any property. Purchasing a home is one of the largest investments you’ll make and it is worth making a small investment now as it might save you substantial money in the future.
Also, if you are interested in knowing the “life expectancy” of an appliance or a component in your new home, I suggest you view the National Association of Home Builders booklet
that outlines the number of years an electric water heater will last, how long gutters will survive…. Once again, the life expectancy is dependent on factors including installation, maintenance, quality, and environmental factors Please click
on this link to view the full report:
http://www.nahb.org/fileUpload_details.aspx?contentID=72475
What is a CL-100/termite letter?
South Carolina real estate purchase contracts have a clause that states the seller is to provide the buyer with a clear CL-100. A CL-100 is a wood infestation report that indicates if there is any visible infestation and/or damage caused by
insects—not only termites but also beetles. The report also covers if there is decay in areas of the property which are accessible. However, the inspection for the decay fungi is limited to the area below the first main floor although I have seen in numerous occasions where pest control companies
note decay fungi on door jams, garage jams…which are much higher areas. The below link is to an article published by the Department of Pesticide Regulation of Clemson University
entitled, “Understanding Your Wood Infestation Report.”:
What are closing costs for a buyer?
When you purchase a home not only will you need to bring money to the table for the down payment but there are additional fees that you will be responsible for. When you apply for a
loan, your mortgage lender is required by law to provide you with a “good-faith estimate” outlining your expected closing
costs.
Your closing costs in general include fees for the attorney, loan origination, appraisal, survey (survey & appraisal fees are usually paid in advance of closing), title search/abstract,
hazard insurance, title insurance binder, document preparation, recording, courier and title insurance. Closing costs can run
into the $1000s+++.
However, closing costs can be negotiated with the seller. Hence when you present an offer to a seller you might agree to pay the full list price but request for the seller to pay 3% of the sales price towards your closing costs.
The rule of thumb is that closing costs usually are around 3% of the sales price but this depends on the type of loan you are obtaining, day of the month you close on, origination fees, points, your credit score(s), if you want to buy down
the interest rate….
Here are some approximate/general numbers to give you an idea of the different items and fees. Not all of these fees might be applicable to you:
-Appraisal Fee ($325-$400)**usually paid prior to closing
-Home Inspection fees ($250-$500)**usually paid prior to closing
-Survey ($250-$400) of property**usually paid prior to closing
-Credit Report ($10-$50)
-Origination Fee (1% of loan amount)
-Tax Service Fee ($80 to $100)
-Flood Certificate Fee ($8 to $30)
-Underwriting/Processing Fee Fee ($50 to $500)
-Attorney Fee ($400-$500)
-Document Preparation ($50 to $350)
-Title Search ($300-$500)
-Title Insurance Binder ($100)
-Recording Fees ($10-$35)
-Courier Fees ($25-$50)
-Title Insurance ($2 per 1000 up to $100,000; $1.50 per 1000 over $100,000. A contract by which the insurer agrees to pay the insured a specific amount for any loss caused by defects
of title to real estate.
Private Mortgage Insurance (dependent on loan value) Homeowners Association Transfer Fee (varies from subdivision
to subdivision)
Prepaid Items: Prepaid taxes (amount depends on month of
closing)
2 months + one year hazard insurance (dependent on mortgage lender)
2 months + one year mortgage insurance (dependent on mortgage lender)
2 months + one year flood insurance (dependent on mortgage lender)
These amounts are paid by the lender into an escrow account to assure future payment of hazard insurance, real estate taxes, and mortgage insurance.
The above numbers are to give you a general—ALWAYS request
a good faith estimate from your lender which will be up-to-date.
