Is it okay to ever waive the inspection?

Rental Property Investor · Member since 2019 · 199 posts · 42 votes

Hello everyone. Is it ever OK to waive the inspection? I put in an offer for a three family home, recently fully renovated inside and out. In speaking with the agent he mentioned I have a better chance of getting my offer excepted if I waive the inspection. What are your thoughts?

1 Reply

517 views

Most Popular Reply

Edward Liu

Palo Alto, CA · Member since 2017 · 230 posts · 200 votes

My suggestion is to get a better agent. No good agent would suggest to waive inspection as way to improve your chances. Agents have suggested to me to offer all cash, reduce inspection period, reduce closing time, increase deposit, increase $$, etc., but never waive inspection. Not a single agent ever suggested it - I have dealt with at least 100+ agents over the years.

I don't trust anything seller tells - even if they say it is fully rehabbed. Sometimes the seller doesn't even know the structure problems, until someone does inspection. Waive inspection is a big NO for me.

Only scenarios okay to waive inspection is you are an inspector or you plan to tore down the building and do a rebuild.

15 Reply

See this reply in the discussion

86 Replies

Jump to latestLatest

Sort by

Max T.
Investor · Philadelphia, PA · Member since 2015 · 3k+ posts · 3k+ votes
6y
@Simon Obas
I did recently on a property that I am going to gut down to the studs.
0 Reply
James Hamling
Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
6y
Originally posted by @Simon Obas:
Hello everyone. Is it ever OK to waive the inspection? I put in an offer for a three family home, recently fully renovated inside and out. In speaking with the agent he mentioned I have a better chance of getting my offer excepted if I waive the inspection. What are your thoughts?

Your agent is advising you on the market place, and strength of your offering vs others or expected others, which is a good job done on part of the agent, don't you agree it's important to know your competitive potential in an offer?
That said, would you waive inspection or not is a completely different matter than what the market is doing. I will advise clients on the market competition in offerings AND I let them make the choice after advising I ALWAYS advise to do an inspection. Even those saying they do offerings waiving inspection, they did an inspection they just did it themselves in the vast majority of cases, I am one of those people, but I have been a GC for a decade + with countless renovations behind me, I know what I am doing.
My opinion, even if the market has everyone waiving inspections, don't, unless your 100% confident of your own inspection. It could mean losing out on buy after buy, maybe dozens upon dozens, that just is what it is in some markets, don't let herd thinking determine your actions. Know what you need to do for you.
0 Reply
Joseph Hammel
Rental Property Investor · Lake Hallie, WI · Member since 2015 · 292 posts · 144 votes
6y
It depends on the market. If it's hot your offer will stand out. I never used to get them because I thought I could find any issues myself however I have found them more useful and they have paid for themselves on the last two deals. On both I went back and got credits to cover the issue that far exceeded the cost of the inspection. Alternatively you could look at other options like putting up more earnest money to make the offer more appealing.
then some
0 Reply
Kanwar Sodhi
Real Estate Agent · Chantilly, VA · Member since 2016 · 245 posts · 61 votes
6y
If the home was built like 2-3 years ago or if it's like a no-brainer meaning a stellar deal in a great location
0 Reply
Craig Kamman
Rental Property Investor · Plymouth, MN · Member since 2019 · 11 posts · 4 votes
6y
I don't do inspections on my personal investments, but I am comfortable on inspecting the big items myself before making an offer. It makes for a cleaner offer for the seller.
A home inspection will run about $450. The big items that would be deal killers are foundation/structural, HVAC, electrical, and roof. All these are visual inspections looking for obvious signs and age/condition. I have worked in the construction industry and have sold homes for over 20 years. I am comfortable doing that. Any of the smaller items I might miss can usually be covered by the $450 I saved.
As a Real Estate Agent; I always recommend the buyers have a home inspection. Especially if one doesn't have a lot of experience yet.
Another way to do it could be to have someone you trust and knows what to l look for look at the property before you make the offer.
Hope this helps.
0 Reply
Nick Rutkowski
Rental Property Investor · Ithaca, NY · Member since 2015 · 1k+ posts · 1k+ votes
6y
@Simon Obas
I learned this hard lesson, if you don’t hire an inspector then you have no leg to stand on if you sue the seller because they lied to you about the condition of the house.
This happened to me, 450 dollars could have saved me 20k and a foundation problem. OOPS!
Couldn’t sue because I couldn’t prove I didn’t know about it. The only way I could have done is with an inspection. So get one, for legal purposes and to use it against the seller as leverage.
0 Reply
Curtis Mears
Property Manager · Raleigh, NC · Member since 2014 · 729 posts · 596 votes
6y
@Simon Obas
Why would you waive it? You can always tell them you will by as is no,matter what the inspection comes up with. But the inspection will give you a punch list of issues to fix.
0 Reply
Daniel SmythPro Member
Rental Property Investor · Rockford, IL · Member since 2019 · 471 posts · 342 votes
6y
To have an inspector, is to have an unbiased eye and opinion. An inspector is usually only responsible to refund his fee if you later find out he missed too much, so the inspector is NOT the guarantee all is well. I have had inspectors ask me if I really wanted the house, and why I was buying the house before the inspection. Thus, the inspection can be as thorough as you like, as you are paying for it.
The inspector helps protect you, that's all. After your inspection, it is up to you if you bring up some issues found.
I have a good understanding of structures, so I rarely do an inspection unless the lender requires it, or if I really want the property, and the seller seems to direct me away from certain areas of the house. Thus another gamble to add to the many gambles in this line of business.
If the broker advised me against getting an inspection to secure the property, I would get the inspection and expect that my offer was going to have contingencies. There is a deal for everyone, and every property. Good luck!
[email protected]
1 Reply
Barry Cohen
Inspector · Freeport, NY · Member since 2013 · 136 posts · 36 votes
6y
Many of the rehabbed homes I have inspected had major problems. Keep in mind, these rehabbed homes generally rehab the pretty parts of the home. Typically the mechanicals, electric, plumbing, structure are not touched, and these are what you want inspected. Do not pass on the inspection.
0 Reply
Mike Mocek
Property Manager / Licensed Realtor · Toledo/Columbus, OH · Member since 2019 · 244 posts · 262 votes
6y
I would suggest finding a different agent as they are not taking YOUR best interests first. I recommend Home Inspections to EVERY client of mine, it is extremely important to make sure that you are completely in the know. If you were to purchase the home without an inspection, that agent could get in some trouble (At least here in Ohio).

With that being said, I have some clients that do not want inspections and know what "They are looking for" and some clients that will not move forward without an inspection. Best foot forward, do a home inspection, that $400 could save you THOUSANDS of dollars AND years of headache. Not sure where you are looking to purchase, but in Ohio we have home inspectors that specifically offer an "Investors Special" which is the basic mechanical of the property (Electric, Plumbing, Roof, Foundation, Hot Water Tank, Furnace etc).
0 Reply
Darius Ogloza
Investor · Marin County California · Member since 2018 · 1k+ posts · 2k+ votes
6y
Market conditions will control, as always. In my market, you have no chance of getting the property unless you waive inspections.
0 Reply
Michael King
Rental Property Investor · Navarre, FL · Member since 2019 · 913 posts · 640 votes
6y
If you find a good inspector, keep him (or her). I've hired many inspectors over the years. It seems that when I buy a house, the inspector I use always misses important flaws. And when I sell, the inspector the buyer uses always finds those, and more.
I finally stumbled on a good one, and I'll always use him now.
Of course, you can learn a lot from inspectors if you stick with him during the inspection. One day you probably won't even need to use an inspector as you'll know what to look for.
0 Reply
Jill H.
Investor · Alpharetta, GA · Member since 2008 · 62 posts · 6 votes
6y
Thats more of a reason to get an inspection. Not every home renovated from top to bottom has good quality work. If your agent said otherwise get rid of them! You need to know everything about that house "before you move in not after"!

0 Reply
Bruce Runn
Investor · Minneapolis, MN · Member since 2014 · 743 posts · 927 votes
6y
For everyone saying, it's BAD to not have an inspection done, I'd say, it's an ok method for serous investors who are rehabbing a place and are KNOWLEDEABLE. Some have mentioned that making the inspection contingent is what people get worried about. As @David Greene mentioned, I don't specify an inspection but even after I sign the PA, I bring in people to look at/get bids which I specify in the contract so they know I'm going to fix it up. I'm a GC so I know more than an inspector. I could walk away if I found something I didn't notice before just at a cost of earnest money so there are still steps you can keep. Such a blanket statement that inspections should never or only in a case of a tear down are naïve. New investors or people who lack skills need to be much more cautious so they should put inspection contingencies in place but know if it is a great property in a great area, you're not the only person making an offer. I buy places often w/o an financing contingency or inspection contingency because I know what I'm doing and have seen it before. My offers are almost always accepted including one recently for $70,000 less than assessed or appraised value and $80,000 less than list price since it was an estate and nothing was done to "spruce" it up. Every flaw stood out even if its going to take only about $8-10,000 to fix everything. The minor things caused 90% of the people to pause and not make an offer and the other 10% put in so much "what if cushion" in their offer or contingencies (inspection/financing) that I got it because the seller's kids just wanted to insure the sale would go through. If it had the trim painted- two sets of windows replaced, hot water pipes replaced with pex to get a decent water flow, old hot water heater replaced, ect, it would have gone for top dollar- it didn't. This is exactly what investors are looking to buy since the discount is deep because there is some uncertainty. Not using inspection and financing contingencies are what makes the difference in having an offer accepted or not. Think as a seller- do you want a guaranteed sale or one that may close?
I think I'll start another string as I see an inspection contingency to be more important to an investor who needs help as compared to a financing contingency. If you have 20-25% down, are you really worried that you won't be able to get a loan? When I sell a property now, we convey that a financing contingency will only be accepted to cover the appraisal so they get 10-14 days and not up until 7 days before close in case a person gets cold feet. If you are presenting me with a bank's financing letter, you should be ok with not thinking you won't qualify. I don't even look at offer with 3-5% down as those are the ones that may/may not go through.
1 Reply
Bobby Shell
Investor · Fort Collins, CO · Member since 2018 · 165 posts · 127 votes
6y
@Simon Obas
If an agent tells you to waive an inspection get a new agent! This game is not about just getting deals done. You have gotten to protect yourself and it’s your agents job to do so. They sound desperate for a sale or aren’t educated enough as to why foregoing an inspection is needed.
Scary stuff.
0 Reply
Christopher Lombardi
Developer · Point Pleasant Beach, NJ · Member since 2015 · 303 posts · 216 votes
6y
If you have experience and know what you are looking at its fine. But it sounds like you may need to get the inspection done. After you do a few deals and get the hang of it you will often times get better deals waiving inspections.
0 Reply
Syed H.
Developer · NY/NJ/PA · Member since 2018 · 758 posts · 935 votes
6y
Depends on your experience and risk level. Ive bought maybe 20 properties in the past year, I only had an inspection on 1 property. I only use them as a negotiation tool with private sellers on SFH flips.
If you are buying a renovated unit, many times an inspection will miss issues. They can’t see through walls. But they can notice signs of cutting corners and red flags that newbies might miss. If you are newer, I would definitely get an inspection. I personally don’t like buying renovated stuff for this reason, I’d rather renovate myself and know it is done properly.
0 Reply
Hai Loc
Specialist · Toronto, Ontario · Member since 2012 · 2k+ posts · 891 votes
6y
@Simon Obas
Yes if its going to be demolished for redevelopment.. or simply land value to land bank..
0 Reply
Jeffrey DanielsBusiness Member
Real Estate Broker · Phoenix, AZ · Member since 2016 · 68 posts · 38 votes
6y
@Simon Obas surely they're talking about waiving the inspection contingency to the purchase contract, and not the ability to have an actual inspection. You may have options to negotiate depending on how much you're wanting to risk as an earnest deposit.
[email protected]602-975-3566
Jeffrey Daniels, REALTOR® - Century 21 Arizona Foothills519 Reviews
Website View Page
0 Reply
Sarai Johnson
Real Estate Agent · San Antonio, TX · Member since 2014 · 3 posts · 3 votes
6y
The agent is there to represent his client (the seller) and it would ALWAYS be in their best interest for the buyer (you) to waive the inspection. Now there are times when a seller gets the property inspected prior to listing or gets a copy of an inspection report from a previous buyer that was planning to purchasee the property. In this case, you can request for the inspection reports and in most states it's required that the seller disclose any inspection reports. In this case, it MIGHT be okay to waive it.
BUT unless you are an inspector yourself or have an eye for plumbing, roof, foundation and electrical issues then I would advise you to invest $500 on an inspection that can possibly save you $1,000s in the future!
1 Reply
Justin Sullivan
Real Estate Agent · Phoenix, AZ · Member since 2019 · 158 posts · 140 votes
6y
@Simon Obas
If the agent is telling you to waive the inspection then I wouldn’t waive the inspection. To me that’s a red flag for problems that can’t easily be seen. That house may have been renovated but I see
Things like this all the time where something is
Renovated fast and cheap to hid the imperfections. I have see many properties where knob and tub has
Been hidden junctions behind closed walls. Mold and moisture covered up or painted over, which will appear down the road. Unless you are very skilled in inspections or contracting and know what your looking at I would never waive the inspection. I never get them just because I know what I am
Looking at but If I see something I am
Not
Sure of I call someone. Don’t waive get the inspections
0 Reply
Jenning Y.
Investor · USA · Member since 2015 · 168 posts · 243 votes
6y
@Simon Obas Of course you can if the price reflects the worst case scenario. I once bought a short sale property without inspection, even the contract allowed me to do so. Because I figured out even in the worst case scenario it was still a good deal. And it WAS. So that really depends...

0 Reply
Cassandra East
Member since 2019 · 1 post · 0 votes
6y
All depends on how comfortable you or your team are in taking the monetary risk associated with waiving inspection. We purchased a residential property that is currently renting. I requested the inspection be waived just to place us in a better place to win out other bids. However, I would not even consider waiving if we didn't have a team that didn't have an eye for those possible hidden issues (foundation/structure/mold issues). I would not pass on inspection, especially at the suggestion of a seller or his/her agent unless you are skilled at detecting issues or have a team that could do so and you are willing to take the risk.
0 Reply
Sam Trentwood
Rental Property Investor · Dallas, TX · Member since 2018 · 34 posts · 20 votes
6y
@Simon Obas
We waive inspections often. But that doesn’t mean we are not doing a thorough inspection. It only means our offer is not contingent on what on what you find on the inspection. We do a full inspection on all the properties we buy, but it is not a condition for closing. But we always have other conditions on the contract, that we can use if we need to get out of the contract.
0 Reply
Amy A.
Portland, ME · Member since 2012 · 616 posts · 550 votes
6y
I always do my own inspections, but I have a lot of experience. With foreclosures, I always assume that at least one major system will need replacement. It's almost worse with a remodeled home if you are paying full price. Keep in mind that an inspector can't look behind walls, and that's where pretty new sheetrock can hide a mess.
1 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.