When I am working with clients who are buying or selling their first home or perhaps even their second or third home I find most people have no clue what EMD is. How much EMD is necessary, what
THE TRICK SOME PEST COMPANIES DON’T WANT YOU TO KNOW ABOUT…
Dated: June 18 2019
If you have bought or sold a home you have most likely purchased a pest report. Pest reports are completed by licensed professionals that are governed by the Structural Pest Control Board. Pest reports are a very important part of the due diligence period when purchasing a home as they determine if there is any damage or possibility of damage from insects, bugs, termites and or dry rot. It is important to understand what kind of damage if any and the cost associated with repairing the damage prior to purchasing a home as some repairs can be quite costly and the knowledge you gain may allow you to renegotiate a better price, repairs that the seller will need to complete or a credit towards those repairs.
There are two types of repairs noted in the pest report, Section 1 items and Section 2 items. Section 1 items are those where there is an active infestation or damage due dry rot or damage from wood boring pests. Section 2 items are those where conditions could lead to pest infestation or dry rot. Section2 items do not currently have damage but if not resolved could lead to damage and it is important to be aware of and to get resolved as soon as possible.
I have worked with quite a few pest companies and have found some excellent companies that do quality inspections and stand behind their work but I have also found a few bad ones as well. As a home owner or a home buyer here are some things you need to look out for once you receive the pest report.
· Pest reports ONLY cover accessible areas. Unfortunately pest companies cannot use x-ray vision to see behind walls or other enclosed spaces. Pest companies do typically inspect all accessible areas such as attics and crawlspaces. Be aware that during the course of repairs pest inspectors may find additional items that were not noted in the initial inspection that WILL cost additional money to repair.
· Pest reports typically do not mention or cover rodent infestations. In most cases the inspectors are looking for wood damaging insects, dry rot or conditions that can lead to dry rot such as a leaking toilet or uncontrollable moisture.
· Pest repairs typically DO NOT include repainting any wood that has been replaced. They will however paint the wood with a primer to seal the repairs which is required for Section 1 clearance. In many cases the pest company will paint the repairs with matching paint if the paint is provided. Sometimes they charge an additional fee for this and sometimes they will do it as part of the repairs if asked but you MUST ask to have this done and you MUST provide the paint otherwise you will end up with the standard primed wood.
Now that we have a basic understanding of the pest inspection I want to bring to light a trick some pest companies use and you as either the buyer or seller need to be aware of because the cost of not knowing or understanding the trick could be huge.
FUTHER INSPECTION… On the first page of the pest inspection you will notice several check boxes. Make sure that the complete report box is checked otherwise you may be looking at a limited report with a constrained scope of work. Then make sure that the Further Inspection box is not checked because this is where they get you!
If the Further Inspection box IS checked that means that there are areas of the home that have not been inspected. In some cases it is just not possible for the pest company to inspect all areas of the home at the time of inspection which can be due to personal items blocking the way or perhaps a crawl space that is not accessible but this is where the costs can add up!
You as the buyer or seller will want to get these uninspected areas inspected to ensure that there is no additional damage that was not noted on the original pest report so you can have a true cost of repairs. Keep in mind the pest company will charge for an additional report to access those areas once they can be accessed but this is a minor cost compared to the unknown. Again, in some cases there is just no other way around having an additional inspection for those in accessible areas.
However, I have had a few pest companies use this Further Inspection box as a way to provide a lower cost of repairs upfront to get the job but then SURPRISE customers with additional costs once repairs have started and at this point there is no backing out.
Here is an exact situation I experienced on a property I recently renovated. The pest company inspected the home and provided a bid to repair the damaged areas. However, they also checked the Further Inspection Box. They noted under the further inspection section that ALL Section 1 Items would be subject to further inspection and if additional damage was found during the repair process they would issue a supplemental report with a cost to repair which basically gave them a blank check for repairs. And what do you know… During the course of repairs they found additional damage that significantly increased the cost of repairs. Now again, I understand that they don’t have x-ray vision and cannot see what is behind walls but the additional repairs were plain as day for a licensed professional and for anyone who has dealt with dry rot before. This company and a few others out there use the Further Inspection Box as a way to hide the truth and act in unethical ways to increase their revenue. They noted that there was dry rot to portions of the siding and gave a low bid to scrape the dry rot off and chemically treat the surface. However, it was clear that scraping would not be sufficient to remove the dry rot as the siding was completed rotted through, so bad in fact that I could push my finger through the damaged portions. The initial bid should have included completely removing the damaged siding and replacing it. They also failed to inspect the underside of the deck which was easily accessible as the deck was raised off the ground about 5’ making it easy to walk under and inspect.
So beware and be wary of any pest inspection report that has the Further Inspection Box checked. Before you sign off agreeing to repairs, credits or a price adjustment make sure those further inspection items are examined in detail. Make sure you have an inquisitive Realtor to guide you through the process. In my case it was a long battle with the pest company but in the end they agreed to honor their initial bid and ate a majority of the costs associated with their so called “Further Inspection.” Of course I will not be using that pest company again!
Justin Cooper is a 14-year Real Estate veteran based in the Greater Sacramento region. However, his career has taken him to numerous markets around the country. Justin prides himself on superior custo....