Get A Clue

Oh, if the walls could talk. That's about the only way to find out what has really happened to a home if you don't get a CLUE. We'll explain what it is and why you might need one.

The CLUE Report

What it is---A CLUE stands for Comprehensive Loss Underwriting Exchange. Essentially, it is a report that includes information about any insurance claims that have been filed on the home.

Why it matters
The CLUE report is now ordered by the insurance company that will insure your home. If you're buying a home, you may have a hard time getting coverage if several claims have been filed for the home in the past. If you can't buy coverage, you'll have a hard time getting a loan for the house.

How to get a CLUE
Only the homeowner or an insurance company can order a CLUE report. If you're considering putting an offer on the home, you can require the seller to order a CLUE report for you (the cost is typically about 12 dollars). If they're not willing, the insurance company you believe you will use will order a report on the home. They should be able to provide you with a copy.

The future of CLUEs
Mike McCartin with the Independent Insurance Agents and Brokers of America says you can expect CLUEs to become as essential in the home buying process as home inspections are today.

The home inspection is still a critical part of buying a home. Home inspectors go through the house from top to bottom, looking at things like the heating and electrical systems, plumbing, roof, walls and foundation. If problems are found, the inspector will notify you and often suggest a specialist to make any necessary repairs. Armed with this information, you may be able to deduct the price of the repairs from the cost of the house. Or, you could ask that the current owner make any repairs, but be sure to put any agreement in writing.

Buying a home will probably be the most expensive purchase you'll ever make. That's why a home inspection is so important. It will give you a realistic picture of your prospective new home, so down the road, there won't be any surprises.

Even if you've owned your home for some time, you may also want to consider hiring a home inspector. A thorough inspection can help you identify problems in the making, so you can take preventative measures that may save you money in the long run.

Finding an Inspector

There are many ways to find an inspector. Here are a few suggestions:

Realtor.

If you're buying a home through a real estate agent, ask him or her for a recommendation. Realtors usually keep a list of inspectors and should be able to give you names of several you can contact. According to the American Society of Home Inspectors (ASHI), 69% of homebuyers choose their inspector based on a recommendation from a realtor.

Word of mouth.

Ask a friend or co-worker for a recommendation.

Online

You can also find a home inspector online. Check out the various Web sites for national home inspection organizations. The American Society of Home Inspectors, the National Association of Home Inspectors, and the Society of Professional Real Estate Inspectors are three of the major associations.

Check Qualifications

No matter your source, make sure you check out the inspector's qualifications and experience.

Insurance.

Ask if the inspector carries insurance. Most professional inspectors carry malpractice and general liability insurance as well as workman's compensation. Don't forget, you'll be the inspector's employer. If he or she gets hurt on the job, you don't want to be responsible.

Association affiliation.

Find out if the inspector is a member of a national home inspectors' organization. Many of the associations review the inspector's work annually to make sure it's in compliance with the organization's standards and ethics.

Terms of agreement.

Talk to the inspector about a pre-inspection agreement. This is an important written contract of what the inspection includes and how it will be done.

Report timeline.

How fast will you be getting the report? If you're buying a home, you'll want the report well before the scheduled closing. That way, if repairs need to be made, you and the seller will have time to negotiate about corrections.

Extra services.

Does your inspector provide other services like radon and water quality testing? If this information interests you, you may want to find an inspector that can handle these services, too. Extra services should also be included in the pre-inspection agreement.

The Cost Factor

Most inspectors charge from $250 to $500 and up. That number can jump to more than $1,000 with extra services. You may want to watch out for inspectors who are offering to do the job for much less. It generally costs at least $100 in expenses just to complete the inspection.

Home Inspection Guarantee

A home inspection is not a guarantee that problems won't pop up after you move in. However, if you believe the problem existed at the time of the inspection and should have been mentioned in your report, you should contact your inspector. Misunderstandings and differences of opinion are often resolved this way.

If that doesn't work, your next step is to contact your local Better Business Bureau or mediation service to help you settle your disagreement. Litigation should be your last option. It can be very expensive and does not guarantee results in your favor.

Did You Know?

Nearly 99% of realtors recommend that buyers get a home inspection.

77% of homebuyers obtained a home inspection in 2000.

American Society of Home Inspectors

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