When a property is sold, an inspection of the dwelling for termite infestation may be conducted, resulting in a report of findings which is prepared by the pest control company. The following information addresses some questions which Sellers and Buyers may have about this process.
Is a Structural Pest Control Report required when property is sold?
The state regulates structural pest control firms, but it does not require the issuance of an inspection report prior to the sale of property. Typically, the seller and buyer negotiate who will pay for the pest report at the time the offer to purchase is made. Many lending institutions, including VA loans, require an inspection to ensure that the building is structurally sound. This requirement protects the lender’s investment and provides the home buyer with an inexpensive safeguard against the cost of structural pest control repair and treatment.
How do I know which pest control company to use?
You may want to contact a family member or friend who has used a company in the past for a recommendation, or your real estate agent may direct you to a company in the area as well. The Structural Pest Control Board cannot recommend a specific company, but it can verify the status of a license or company registration and provide complaint history.
What can I expect when my property is sold and escrow is opened?
The pest inspection, including payment, is negotiated in the purchase contract. Subject to the agreement of the parties, the Seller or Buyer will hire a pest control company to perform an inspection. The company is accountable to both the Buyer and Seller, regardless of who pays for the inspection. The report is furnished to the person who ordered the inspection, their agent and the escrow company who delivers copies of the report to the other party for his review as well. The Buyer should consult with the inspection company if there are questions about the report or the company who performed corrective work.
What information is included in the inspection report?
The same standardized inspection report form is used by all companies and provides information such as:
- Descriptions of any existing wood-destroying pests (termites), fungus, and the resulting damage that is visible and accessible on the date of inspection.
- Descriptions of conditions considered likely to lead to future infestation (referred to as Section II items) such as excessive moisture, earth-to-wood contact, and faulty grade levels.
- A diagram on the report must show every part of the house checked for signs of infestation or infections, and marked where each infestation or infection found is located.
- Recommendations for treatment or repair.
Reports are valid for two years, however, lenders require a report no less than 90 days old. Companies are not responsible for conditions which develop or become visible after the date of inspection.
Who pays for repairs to be made?
Your realtor will either negotiate in the purchase contract who will pay for the repairs the pest control company recommends in their report, or the Buyer can negotiate with the Seller to make all or some of the repairs during the 17 day contingency period. The cost and responsibility to make the required repairs is negotiable between the Buyer and Seller, however the Buyer does have the option to cancel the contract if both parties cannot come to an acceptable agreement. One exception is when the Buyer is obtaining a VA loan. The Seller will be required to pay for the pest control report, however repairs can be paid for by either party, BUT must be completed & paid for before close of escrow.
For additional information about termite reports, feel free to contact me or log on to: www.pestboard.ca.gov