TOPIC: Distressed Property Inspections

Is anyone familiar with, "Distressed Property Inspections?"

I was just approached by an agent friend of mine who recently took a class with a company handling, "Short-Sale Properties," that are training agents to handle the listings. They have asked him to find an inspector willing to perform these inspections, performed for potential buyers interested in learning more about the properties, before commiting to a contract, rather than paying for a complete home inspection before they have decided to commit to the purchase.

I'm just wondering about what type of Agreement I should use, if using a special report format should be used, and what other people are actually inspecting for in this type of home inspection.



Thanks for your help!

Hi Ed, I have done several and I just do a detailed inspection as I would any inspection. If they want estimates "Watch out" I charge a little bit more since some properties are a POS the last one I did the report has been viewed about 6 times the agent paid for it.

Hope this helps

Hi Gary,

I appreciate your feedback! The way this realtor is talking, the home inspector's doing these particular inspections, are doing just a shorter, modified version of the inspection. Something in the neighborhood of an hour to an hour and a half long, and at a lesser fee. Supposedly their not going through the home as we would during a normal inspection. The way it sounds, their probably just looking at things like the roof, foundation, hvac equipment, breaker box, etc. But I can't really be sure. He's just coming from a class with this company, and I think he's not really sure of what they're asking for either. I'm not sure, I'm just hoping that someone on this forum is familiar with this approach, if it's really something that is being performed right now.

Ed, In a short sale they are trying to convince the back that the property is not worth what is owed. To do this they usually get at least two estimates from Contractors and  a Inspection report. The Contractors estimates are very detailed "at least mine" so if the Inspection report is not complete the bank may not be convinced that the short sale is warranted. They want you to make the property look as bad as it is, not good. To do a four point inspection will not show all the defects.

Thanks Gary! That makes perfect sense! I'll get together with my Agent and show him this information. Have a great day, Sir!

Not sure if VA is a licensed state but you might want to check the legal  ramifications of performing an abbreivated inspection if you are licensed.  In NC, any inspection of 3 or more systems is considered a home inspection and must follow the SOP with regards to inspection and reporting.  Licensed tradespeople are excluded since they are providing quotes for repair, not inspecting the home. 

Have heard of inspectors doing a "Walk N Talk consultation" for investors.  They are hired as "consultants" not home inspectors.  There is no written report.  The "consultant" and buyer walk  through the property together while the consultant points out glaring issues.  Fees are often based on hourly rate vs. flat price per home inspection.

I can see how it could be useful to savy investors but very dangerous for 1st time home buyers trying to get into the flipping market or buying a foreclosure with the intent to save money.  I also see how it could be considered skirting the home inspection laws with possible legal consequences.