Third Parties To The Transaction
As I said in the beginning of the book, when I use the term "Third Parties", I'm talking about people involved in the transaction, not including you or your client. 90% of the time I'm referring to dishonest and/or incompetent Realtors when I mention "third parties"! Other "third parties" involved in the transaction includes but isn't limited to: the seller, the appraiser, the home inspector, the mortgage lender, the title company, the attorney, the builder or repair contractor, the mailman, the Tooth Fairy, Santa Claus, the Easter Bunny, the seller's dog or cat, and anyone else who may have an interest in the deal. Also, when I use descriptive adjectives and refer to immoral, greedy, dishonest, ignorant, incompetent, etc. Third Parties, it does not refer to all third party people, just those that match the particular adjective used (90% of the time it's the Realtor!!!).
Realtors can be important people involved in the purchase and sale of real estate. They can provide a service that helps the public to buy and sell property. The problem is that the majority of Realtors can be very dishonest, greedy, incompetent, immoral, ignorant, or a combination of all of these undesirable qualities. To make matters even worse, they go a step further and think that they're experts in every aspect of real estate. These are the third party people that I'm referring to!! You need to understand that third parties, such as Realtors, are not experts in real estate. Realtors only need the equivalent of a few days of basic real estate classes to get a license. So don't think they know all the important aspects of investing in real estate. Even if a Realtor has many years of experience as a real estate agent and/or investor, they're not knowledgeable in all aspects of real estate. They cannot give you advice like a qualified real estate appraiser, home inspector, builder, real estate attorney, etc. can in each particular field of expertise.
In case you didn't know, almost all of the time the Realtor works for the seller, not the buyer.
In case you didn't know, almost all of the time the Realtor works for the seller, not the buyer. Sometimes the Realtor will represent the buyer as a "buyer's agent" but that's not very common. Some states require Realtors to sign an agreement with potential sellers and buyers clearly stating whom they're working for. One reason for this may be that some home buyers don't realize that the Realtor often represents the seller. This means that when you go into a real estate office looking to buy a house, the Realtor that shows you the properties listed for sale has a fiduciary responsibility to the seller of the house! Even though a buyer goes into the real estate office looking for houses, the Realtor still works for the seller. In this case the Realtor is responsible for looking out for the seller's best interest, and not the buyer's. Some buyers don't know this and mistakenly think that the Realtor is looking out for their best interest only. (Some Realtors only look out for THEIR OWN best interests, regardless of whether they represent the seller or buyer! It's as though some Realtor's believe their fiduciary responsibility is only to fill their own pockets with sales commissions.)
An educated home buyer or seller is a dishonest Realtor's worst nightmare!!
An educated home buyer or seller is a dishonest Realtor's worst nightmare!! I've seen plenty of greedy, ignorant, dishonest Realtors and third parties get angry because my clients wanted to take my advice and check everything out about the house they were planning to buy or sell. I think the last thing a greedy, dishonest, ignorant, immoral and/or incompetent third party person wants is an educated home buyer or seller. That's because an educated home buyer or seller is a careful, intelligent person who checks everything out before making a big investment. This can take a few days to check the town hall records, get repair estimates, etc. If a home buyer or seller wants to verify items by checking the documentation themselves, getting repair estimates prior to closing, etc., these Realtors and third parties criticize them and say things like, "Oh, this buyer or seller is just a worrier. They're making a big fuss over nothing. They should just close on the house and forget about it." These third parties can cost a home buyer or seller tens of thousands of dollars. They do this by pressuring your client into not checking everything out before he closing. Far too many people are buying and selling their homes with their eyes closed. Hopefully, my educational materials will open your eyes nice and wide when you decide to buy or sell your house!
Sometimes the seller of the house, the Realtor, or some other third party will tell you something, such as the air-conditioning system, works just fine. However you find that you can't operate the system by its normal controls. If the seller, Realtor, or other third party get very defensive about the situation and insist that the system works properly, just tell them to go ahead and turn it on so you can evaluate the air-conditioning. Don't get in an argument with them just say, "Great, you urn it on and I'll be more than happy to evaluate the A/C for my client." This way you dump it back in their lap and leave it up to them to turn on the system.
Now remember, I said this in the beginning of the book and I'll say it again. You're a guest in someone else's house! So don't be rude or get into an argument with anyone at the subject property. You have to always be diplomatic and professional in this or any other business to be successful. You also have to respect the seller's property. Don't go into someone's house and start taking the place apart by poking holes I the walls and moving furniture all around. You have to treat their home and personal belongings as you want someone to treat your home and personal belongings during an inspection. Some seller's get very upset and worried during an appraisal and/or a home inspection because it can make or break a real estate deal. So remember to always be polite and courteous during an inspection.
Now don't get me wrong when I tell you this by thinking you have to be a marshmallow during the inspection. As an "A to Z Home Inspector" you still have to do a very thorough inspection. This means that you have to evaluate all visible and accessible areas in the house and on the property. Don't be afraid to probe the visible wood beams on the inside and outside of the house. When you probe the wood beams and exterior trim work you're going to leave marks and some minor cosmetic damage. This can't be helped and it's a necessary part of properly evaluating the structural members for rot and wood destroying insect infestation. However, because probing will leave visible marks in wood, you don't want to go around damaging the interior finished floor moldings, doors and window sills. Just use your common sense when deciding what wood areas are finished coverings that shouldn't be probed and what wood areas have to be probed during your inspection.
I once did an inspection and I was probing the moldings at the base of the garage door trim work. This is a very common area to find rot and wood destroying insect infestation because the wood is in close contact with the soil. The wood was so rotted at the base of the door trim work, that the probe went right through it. A hole that was a few inches in diameter was left in the wood. This is going to happen to you when you probe rotted and damaged wood. There's nothing wrong with you leaving this wood damaged because if the wood is very solid, then it won't fall apart when you probe it. However, if the wood needs to be replaced then it will fall apart and leave some damage. Don't worry about leaving the wood with some cosmetic damage because it has to be replaced anyway due to the rot and/or wood destroying insect damage. All your doing is showing your client and all third parties that the wood needs replacing.
Anyway, after I probed this garage door molding, I told the client and the third parties that this section of wood needed to be replaced because it was all rotted out. About three days later I got a phone call from the Realtor. She said that the seller was going to have their attorney contact me because the seller felt that "I seriously hurt the market value of their property." It was such a ridiculous comment that even the Realtor said the seller was crazy to make that claim. I was never contacted by the seller's attorney because the seller must have realized that they had no basis for a complaint against me. They realized that the wood was rotted out and the probing damage was done during an inspection that they allowed me to do at their home.