Of all possible problems in a house, deficiencies in the foundation can be the most costly. Despite this, few homebuyers realize the importance of thoroughly investigating this system before close of escrow. 

Imagine getting the news that your home needs over $20,000 of foundation work. What if it was $50,000 or more?

Seller’s shocking news

If a seller was not aware of it before he bought the house, he rarely learns of a foundation problem during the course of owning the property.

Typically, a seller first finds out during the buyer’s inspections after the home is in escrow. From the seller’s perspective, this is the worst possible time.

Besides being an extremely unpleasant surprise for all parties, the buyer will most likely request the seller pay for the work. If the seller refuses, the sale may be rescinded and the home placed back on the market.

Pre-sale inspections

I have had three instances this year alone where one of my sellers became conscious of a faulty foundation from the pre-sale inspection. Although the news was disagreeable, all three were relieved to know about it before the home went on the market.

In two of the cases, they had owned the property less than six years. In retrospect, they both wished they had known enough to have hired an engineer to check the foundation at the time of the transaction. Although the need for foundation work causes some marketing problems, they are nothing compared to what happens when they surface during the sale.

Hire a quality inspector

Buyers in this area commonly hire professional home inspectors to examine the house. As with any service, quality can vary greatly. The inspector’s most important job is to tell you if there are any high-priced structural, health or safety issues with the property.

There is no excuse for an inspector to miss a defective foundation. Among the clues are foundation cracks of ¼” or more in width; bowing; settling floors and doors out of alignment; and evidence of soil movement around the property. Insufficient drainage is another possible indication as it may cause foundation damage. 

When observing these signs, a competent inspector will suggest review by an appropriate engineer. Experienced Realtors will be able to recommend one.

Get written engineering specs

Most engineers charge $300 to $500 to inspect a house foundation. Make sure you get a written report whether or not work is required. If there is a problem, you will want the engineer to give you a sketch and calculations for repair. 

Bear in mind that there are usually several options on how to handle this dilemma. When it is the buyer having the inspections, the engineer is usually asked to provide the “best” solution. Invariably, this means the most expensive one. Sellers, conversely, ask the engineer for the least costly approach.

Contractors’ bids

Armed with the engineer’s letter, you now need bids from licensed contractors for the work. Again, your agent should know capable contractors who will give you written bids at no cost. 

For a number of reasons, extensive foundation work discovered during escrow is normally done after close. When identified from pre-sale inspections by the seller, the need for foundation repairs is disclosed to the buyer, but, again, customarily not completed until after recordation.

Final thoughts

How you go about your home buying process will depend to a great extent on the real estate professional you choose. Make sure to select one who will help you thoroughly investigate the property condition. 

Remember, everything rests on a firm foundation. Give it your full attention.

Related Articles: Home Inspections, Part 1 ,  Part 2; and  Pre-sale Inspections