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Home Inspection

Got Protection?
To protect owners in the event of catastrophe, real estate insurance can be the best buy of a lifetime. There are varied insurance categories associated with home ownership, including these major types:

Title insurance:
Protecting owners in the event that title to the property is found to be invalid, coverage includes two types of policies; "lenders" policies, which protect buyers up to the mortgage value of the property, and "owners" policies, which protects owners up to the purchase price.

Homeowners' insurance:
Required when you take ownership, coverage provides fire, theft and liability protection for the home as well as its contents.

Flood insurance:
Issued by the federal government and generally required only in high-risk flood areas, this insurance provides as much as $250,000 in coverage for a single-family home, plus an added $100,000 for its contents. Your agent will explain which locations require such coverage.

How do you get insurance?
It's never too soon to shop around and compare insurance quotes. Be sure to ask your agent about limitations, costs, and deductibles, and most importantly, if your homeowner's insurance plan incorporates a guaranteed replacement cost policy. Since the Insurance company requires a couple of days to secure the policy, you should take care of this during the inspection period.

Your Home Inspection
The AAR Residential Resale Real Estate Purchase Contract is intended to be a binding contract; therefore, the importance of performing your own inspection of a home before you decide to purchase it cannot be understated. Remember that while this is only a precursor to the professional inspection that will soon follow, your personal inspection allows you to pinpoint first-hand any potential problem areas that could cause you to change your mind about whether or not you buy the house. In general, you are looking for such details as: structural cracks; musty smells; rotting floorboards; roof leaks; peeling paint; cracked windows; broken appliances (including air conditioning and heating units); quality of tile, carpeting, and other flooring material; and/or any aesthetic
(such as floor plan convenience, landscaping, or general home maintenance). In particular, you will want to make note of any serious flaws about which you will want to notify the professional home inspector.

Professional Home Inspection
The purchase contract gives you the right to make any inspections of the property/premises for defects of any kind. Buying a home without having it professionally inspected first is about as risky as engaging in a game of Russian roulette. A professional inspection gives you more detailed information than an appraisal; information you need to make a wise decision. In a home inspection, a qualified inspector takes an in-depth, unbiased look at your potential new home to: (1) evaluate the physical condition (structure, construction, and mechanical systems); (2) identify items that need to be repaired or replaced; and (3) estimate the remaining useful life of the major systems, equipment, structure, and finishes. The inspection gives a detailed report on the condition of the structural components, exterior, roofing, plumbing, electrical, heating, insulation and ventilation, air conditioning, and interiors.

Buyer’s Reasonable Disapproval
After any/all desired inspections have been performed, your Realtor may ask you to complete an AAR Buyer Inspection Notice and Seller’s Response. You have three options on this form: (1) Premises Accepted- No Repairs Requested; (2) Repairs Requested; or (3) Cancellation.
Remember, a professional home inspection report is not necessarily a “fix-it” list for the seller. However, if you determine repairs are deemed necessary, you and your Realtor should submit all reasonably disapproved items to the seller. The seller has the option to either repair those items or to refuse to do so. If the seller refuses to do so, you may cancel the contract or proceed without any obligation on the part of the seller to make the repairs.
Your Realtor will be your greatest asset in handling all the negotiations for you in regard to reasonably disapproved items.

Home Warranty
Unlike home owner’s insurance, which is only used in the event of a catastrophe such as fire or storm damage, a home warranty is a renewable contract that combines the best characteristics of an insurance policy and a service contract. A home warranty plan covers home owners against unexpected failures of built-in mechanical systems and appliance failures due to normal wear and tear. A home owner need only notify the warranty company of a problem. The warranty company selects a local, licensed and bonded service technician to diagnose and do the repair. The home owner merely pays a small deductible ($35-$50) for the service. The initial policy period is for one year; however, renewals are available. Ask your Realtor for specific information and read the policy for coverage and limitations.

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