The Importance of the Buyer Inspection Advisory BIA

One of the most important forms that you will see in the paper storm of disclosures is the Buyer Inspection Advisory

San Diego, CA: The majority of real estate purchases in California are done with the California Association of REALTORS® standard Real Estate Purchase Contract (RPA-CA).  Attached to the end of this document is the Buyer’s Inspection Advisory or BIA.  When counseling my Clients I always make them aware to pay particular attention to this comprehensive list of items that should be considered during the inspection period.

Some concerns a Buyer would have in purchasing real estate are universal, while others are subjective.  As a real estate professional we cannot guess what those subjective issues would be in your mind.  By reading and making your real estate agent aware of those concern contained in the BIA – you can further investigate them to determine if they are acceptable or you wish to cancel the transaction.

The BIA starts out letting you know how important it is to consider having property investigations is to determine the present physical condition of the property.  A general home inspection is a good place to start for an overview and then have appropriate professionals do further inspections on items of concern.

As a Buyer you have an affirmative duty to exercise reasonable care to protect yourself.  In layman terms this simply means you cannot rely on Seller and Agent Disclosures without doing your “due diligence”.  You generally will have the first 17 days after acceptance (time frame can be different depending on your contract) to determine the condition and ask the Seller remedy them.  The Seller may choose to make the corrections or not – you will then have the right to move forward or cancel the agreement.

The full Buyer’s Inspection Advisory can be viewed here.  Some of the major points during the investigation period would include, but are not limited to, the following:

• General condition of property including systems and components.  These would include foundation, roof, plumbing, heating, air conditioning, electrical, mechanical, security, pool & spa, etc.
• Square Footage, Age, Boundaries - Square footage, room dimensions, lot size, age of improvements, and lot size.
• Wood Destroying Pests - Presence or conditions likely to lead to wood destroying pests (Termites).
• Soil Stability – Existence of fill or compacted soil, expansive or contracting soil, susceptibility of slippage, settling, or movement.
• Roof - Present condition age, leaks, and remaining useful life.
• Pool & Spa - Cracks, leaks or operational problems.
• Waste Disposal – Sewer or septic.
• Water and Utilities - Water and utility availability.
• Environmental Hazards - See Environment Hazards – A Guide for Homeowners, Landlords, and Tenants.
• Earthquake & Flooding – Susceptibility of the property to earthquake or flooding hazards.
• Fire, Hazard, and other Insurance – The availability and cost.
• Building Permits, Zoning & Governmental Requirements – Permits, inspections, and or governmental restrictions.
• Rental Property Restrictions – Limits to amount of rent that can be charged.
• Security & Safety - State & local law may require installation of barriers, access alarms, etc.
• Neighborhood, Area, Subdivision Conditions; Personal Factors – See BIA.

In summary, take your time and read this important document.  Discuss your areas of concern with your Real Estate Agent and appropriate professionals so that you fully investigate your concerns during your contingency period.  Purchasing real estate is probably the largest single investment that you will make and you should take the time and care to make an informed purchase.

A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS.  IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL.

Photo Courtesy of Flicker by Donna Wilson.