Is A Home Inspection Required To Qualify For A Mortgage?

Purchasing a home includes many steps and requirements, especially when financing the property with a mortgage. Understanding the details and timelines can feel overwhelming and confusing. One task that we often receive questions about is whether the homebuyer must schedule a home inspection as part of the mortgage qualification process.

At 5280Lend.com, we are a mortgage bank dedicated to helping our clients secure the right financing option. We work with you each step of the way to ensure you don’t skip essential decisions.

Do I Need a Home Inspection for My Mortgage?

Colorado lending laws do not require borrowers to complete a home inspection to receive approval for a home loan. Also, mortgage lenders do not require a home inspection as part of the closing process. The home buyer can decide whether to schedule a home inspection.

Should I Schedule a Home Inspection Anyway?

We always believe that a home inspection is one of the most valuable investments you can make in learning about the building you are thinking of buying. It provides an opportunity to identify any potential issues with the home before the closing. It can also help buyers negotiate for repairs with the seller. If the seller refuses to make the requested repairs, the sales contract usually allows the buyer the option to walk away from or renegotiate the deal.

We typically recommend a home inspection, even though lenders and state laws do not require the inspection. If the process uncovers significant issues, you could save yourself the frustration of big financial surprises.

What Is the Difference between an Appraisal and a Home Inspection?

An appraisal and a home inspection are two different processes. While both will look at the property’s current condition, a home inspection looks much deeper and thoroughly at the issues of functionality and condition.

An appraiser will look at the property’s market value, considering factors such as location, size, age, and features. The appraiser will also consider recent sales prices for similar properties in the area.

A home inspector will look at the property’s condition, including the roof, foundation, plumbing, heating and air systems, the electrical systems, as well as the overall construction of the home. The inspector will also check for any signs of damage or potential safety hazards. These inspections take hours and sometimes a full day to conduct and give a buyer a very complete understanding of the property that they are interested in buying.

Just because a home inspection is not required by law or the lending industry, doesn’t mean that you shouldn’t get one. Costs can vary between $350 to $1000; and given the fact that average sales prices are in the half a million-dollar range, this fairly small expense seems to us to be a very inexpensive “insurance policy” to protect you from things you may not have otherwise known about. Of course, there are no “guarantees” in life, but this step certainly decreases the likelihood of surprises.

Understanding the Mortgage Process

The mortgage process can be complex and overwhelming. It is essential to understand the steps involved to ensure you are making the best decisions for your financial future.

Working with a mortgage bank like 5280Lend.com can give you the peace of mind that our team will help you understand the requirements and details. We’ll educate you on the options available and how to make informed decisions throughout the home-buying process.

For example, we can walk you through optional versus required tasks. We are also happy to work with your real estate agent to ensure we are all on the same page.

If you are considering purchasing a home in Colorado, contact us today. We can help you from pre-qualification to closing.