Here's What Happens When Your Home Inspector Misses a Major Issue

There's a reason it can take several months to close on a mortgage loan from the time you make an offer to purchase a home. Not only does your mortgage lender have to fully vet your finances in a process called underwriting, but the home you're buying needs to undergo an inspection to make sure there aren't any major issues lurking.

Imagine you've made an offer on a home that needs $25,000 in foundation repairs. That's not the sort of thing that's obvious during an open house. A home inspector can look out for issues like that and flag them so you can then go back to the seller and have them address the problem before your closing.

Usually, in that situation, one of two things will happen. Your sellers will either fix the issue themself or reduce your purchase price by the cost of the repair at hand.

But what if you pay for a home inspection and your inspector misses a major issue? Do you have any recourse, or are you just plain stuck?

When home inspection blunders happen

Home inspectors are trained to spot issues with properties that average people wouldn't know to look for. As an example, you might walk through a home without finding any evidence of mold. A home inspector might easily spot mold because they know where to look and what exactly to look for.

But home inspectors are also people, which means they're capable of making mistakes. You may run into a situation where your home inspector has an off day and simply misses something. Or, it may be that the issue is so hidden that even a trained inspector doesn't uncover it at first.

If you don't discover that issue until after you've closed on your home, you might have to bite the bullet and pay for the repair yourself. But if your home inspector really made a glaring error, you may be able to go after them or their company for compensation.

How to avoid this unwanted scenario

The last thing you want is to pay for a home inspection, close on your home, and move in thinking all is fine only to discover a major problem a few weeks down the line. One way to avoid that is to find a home inspector or company that carries errors and omissions insurance. If you use a professional with this coverage, you may be able to file a claim if they make a glaring error that costs you money.

However, you'll need to make sure you have a right to act on such a policy based on your contract. Some home inspection contracts will only refund the cost of your botched home inspection in a situation like this, but you won't necessarily be eligible for compensation for the work your home ended up needing. It's important to know the difference.

Finally, make a point to attend your home inspection while it's happening. That way, you can ask questions and make certain you understand what condition the home you're buying is in. In some cases, asking the right questions might prompt your home inspector to dig further into an issue, thereby reducing the likelihood of missing something important.