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Home » Mortgage and Real Estate Education Center » Contingencies

Contingencies

Consider these common problem areas when making an offer on a home. You might want to incorporate one or more of these inspection contingencies into your offer.

Drainage

Poor drainage can be corrected by repairing or replacing gutters and downspouts. Over time, the surface of the soil may have changed enough to require grading to direct water away from the structure.

Environmental Hazards

The federal Real Estate Disclosure and Notification Rule  requires that sellers disclose to prospective buyers any known information and reports about lead-based paint and lead-based paint hazards. The seller, however, may not be aware of existing information or reports. If you're buying a home constructed prior to 1978, you might consider an inspection.

Asbestos, formaldehyde, radon gas, fuel or chemical storage tanks and contaminated soil or water are other potential conditions which would warrant inspections.

Heating Systems

All heating and cooling systems eventually have to be replaced. Long before the need for a new heater becomes obvious, however, the heating system may become dangerous. Consider having carbon monoxide detectors installed near the heater and in the bedrooms.

Plumbing

Distribution piping, waste lines and fixtures make up the plumbing system in a house. Distribution piping deteriorates over time and is a common problem in older homes. Iron pipes last approximately forty-five years, and the norm is to replace them as needed. Replacement pipes are usually copper. At the joints between iron and copper pipes, look for rust and mineral deposits. This is evidence of deterioration due to galvanic action resulting from the lack of electrolytic coupling at the joints. In the case of brass pipes, over time the zinc in the brass dissolves into the water, leaving small holes in the pipe. The minerals in the water may eventually seal these holes, but pipes with this condition should be replaced.

Roof

An asphalt shingle roof can be expected to last from seventeen to twenty-two years; a wood-shake roof--approximately forty years. Look closely for newly painted ceilings (especially in closets) which might cover telltale stains caused by roof leaks. Leaks often occur next to flashing around vent pipes and chimneys.

Ventilation and Insulation

Attics are often uninsulated or not completely insulated. A well-insulated attic will reduce heat loss in winter and heat gain in summer. Ventilation helps prevent moisture build-up.
Crawl spaces, like attics, should be insulated and ventilated for the same reasons. Crawl spaces usually have dirt floors, and plastic sheeting is sometimes recommended to help control moisture build-up.

Wiring

Make sure circuit breakers are designed for the circuits they are protecting. It is not unusual to find twenty- and thirty-amp circuit breakers or fuses protecting circuits with fewer amps. This condition can lead to an overload. Overloaded circuits are a fire hazard.

Many homes built between 1965 and 1973 contain aluminum wiring. Aluminum wiring is a fire hazard, according to the Consumer Product Safety Commission. An electrician can pigtail (attach) short copper strips to the ends of the aluminum wires and secure them with special safety connectors to correct the problem. This should only be attempted by an electrician.

Other common problem-areas include:

• Damaged exterior steps and paths:  A physical safety hazard found in 9 out of 10 homes.
• Wet Basement:  Found in one of every two homes with basements.
• Fire safety hazards:  Found in almost one in three homes.
• Termites:  Found in almost one in four homes in areas with termites.
• Hazardous steps and stairs:  Found in more than one in five homes.
• Water heater--missing controls and improper installation:  Found in one in five homes.
• Windows with damaged sash cords:  Found in one in five homes.
• Garage problems:  Found in almost one in five homes.