Your Inspection Report Is For You Not Your Lender

One well-meaning email can slow down a closing or stop it cold, and it happens more often than you’d think. We’re Jim and Laura, and we’re pulling back the curtain on a costly mistake home buyers and real estate agents keep making: sharing the full home inspection report with the loan officer or even an insurance company. That report is detailed by design, and when it lands in underwriting, it can turn routine home inspection findings into “conditions” that trigger delays, extra inspections, and repair demands. 

We walk through a true story where a minor electrical issue, basically an unfinished light fixture with exposed wiring, starts as a straightforward fix. Then the scope balloons. A full electrical report gets created, the entire document gets forwarded, and suddenly the lender is staring at a long list of older-home issues they never asked for. We explain what the lender actually needed all along: a simple confirmation that the specific item was repaired, documented cleanly and clearly. 

From there, we get into the pattern we see with basement moisture, foundation questions, and confusing lender emails that lack standard language. We share how we handle those requests as home inspectors, why we push for precise questions, and how to avoid opening a new can of worms like mold testing or structural engineering when it isn’t warranted. If you’re buying a home, selling a home, or guiding clients as a real estate agent, this is practical advice for protecting your mortgage approval, reducing closing delays, and using your inspection report the way it’s intended. 

If this helped, subscribe, share it with a buyer who needs it, and leave a review so more people stop making the same mistake. What part of the home buying process has surprised you most?

Transcript

SPEAKER_02 0:01

Hey everybody, it's Jim and Laura.

SPEAKER_01 0:03

Hello, everyone.

SPEAKER_02 0:04

Alright, so we this is very important if you are a home buyer. And it's also important if you are a uh a real estate agent to know not to do this and remind your clients, your home buyers, not to do this, also.

SPEAKER_01 0:22

Not even on accident. I've heard of that too.

Appraiser Flags A Simple Electrical Fix

SPEAKER_02 0:25

Yes. But your your report, that is for your usage, not for the loan officer. And what what we hadn't happened, we've seen it in the past, but recently, the or you tell the story. You're you talked to the inspector. You tell me, tell me how all this happened.

SPEAKER_01 0:46

So there was a transaction. Prazer came through and wigged out about something with the electrical. The the guy had taken out a fixture and the wires were dangling. I can't remember if he had him capped off or whatever. I I don't remember.

SPEAKER_02 1:03

Sounds just like an unfinished project.

SPEAKER_01 1:05

Yeah, it was an unfinished project. There wasn't like it was like he had taken out a light and just hadn't put another one back up. So appraiser, instead of staying in his lane, decided that he wanted to wig out about the electric and that the electric needed fixed.

SPEAKER_02 1:21

So our just that one thing?

SPEAKER_01 1:25

I believe so.

SPEAKER_02 1:26

Okay. Okay.

SPEAKER_01 1:28

So our inspector went out the first time and he was like, no, this is a problem, blah, blah, blah. Explained, you know, explained why.

SPEAKER_02 1:36

It's it's well, yeah, you never want exposed wire.

SPEAKER_01 1:39

Right.

SPEAKER_02 1:40

But that's a simple inexpensive fix.

SPEAKER_01 1:43

I I can't remember what the report was or you know, anything like that. That got sent back, and then the appraiser was like, Well, all that stuff needs fixed. It needs fixed, it needs fixed. So the seller went ahead and he fixed everything. We went back out. The seller at this point's insanely frustrated with the process and with the appraiser. And so he makes our inspector inspect all the electric.

SPEAKER_02 2:14

Who who made one of our inspectors do everything?

SPEAKER_01 2:16

The the guy that owned the house, the one that had fixed everything and done everything. So apparently he had fixed that light fixture issue. There was a light fixture in it, it was all working.

SPEAKER_02 2:27

Which is really just putting caps on the bare wires and then putting inside an enclosed box.

SPEAKER_01 2:32

Or just putting a light fixture on and connecting it and calling it good, which I believe is what he did.

SPEAKER_02 2:37

Which is what probably the plan in the first place.

The Full Report Creates New Problems

SPEAKER_01 2:40

So no big deal. That that got that got fixed and done. Our inspector said, listen, you don't need a whole report. You should not send a whole report to your loan officer. He's like, that's a bad idea. Dude insisted that he do all of the electric, send him all of the report, which our inspector then did because it was at the request of the client, and the client was paying. So the client then sends that whole electrical report and there were issues. Of course, it's an older house, there's you know, so there was sh there was shutoff. So the loan officer sends a thing back and he's like, dude, we didn't want all this. I can't look at this because this is going to cause more problems. I literally just need something saying that that was fixed. That's it. That's all I want. So we ended up writing up a letter, putting it on letterhead, sending it in and going, it's all fixed. And that was how we that that was how it ended up being done. So it it was finally fixed.

SPEAKER_02 3:56

So it started from just an appraiser. An appraiser out of their lane. Step out of the lane, and then the buyer then shared the whole report.

SPEAKER_01 4:06

I don't know if it was the buyer or the seller.

SPEAKER_02 4:09

Seller shouldn't get the whole report in the first place.

SPEAKER_01 4:11

Well, the seller was the one paying for the electrical thing, I think. Like this was all the seller. So I I I don't understand the whole dynamics of that, but either way, that report got to the loan officer and it shouldn't have. And the loan officer flat out said, We don't want to see this because this loan wouldn't happen then.

The One Letter Lenders Needed

Why Loan Officers Ask The Wrong

SPEAKER_02 4:31

Yeah. So if you are the buyer or your real estate agent, do not send the home inspection report to the loan officer.

SPEAKER_01 4:39

Don't send it to your insurance company.

SPEAKER_02 4:41

No, no, no. They they will send their own appraiser out to look for issues that will affect the value of the house. But if they see the home inspection report, which is more thorough than these appraisers and what they're looking, we're looking at different things. It's gonna it's gonna cause issues, delays.

SPEAKER_00 5:00

Habitation investigation is the way to go for a home inspection in Ohio. Trusted licensed home inspectors for your needs from radon to malt to warranty. For a great home inspection, you really can't go wrong. Visit home inspections in Ohio.com.

SPEAKER_02 5:26

We've seen, and here's another issue that we come across appraisers. We will every now and then, and it's it's not that rare, get contacted by some loan officer or uh and and what they're doing is they need to know hey, the moisture in the basement, what's going on with this, but is it a structural, is is it structurally impacting the property? Well, and and they will phrase things, they have no standard language for how they're doing. They will ask us about hey, we need to know uh about the foundation, about the water. As a home inspector, I'm thinking, okay, gutters, downspouts, it could be the grading of the house, what's going on? So, and there's one time we did that, we had this. Oh, yeah, we went there, and and we even this is why we have to be very specific with with these uh these loan officers or or appraisers, it doesn't really matter. I kind of see them as doing this causing the same issues, is what's that loan officer? What she wanted to know was is are there any pipes busted?

SPEAKER_01 6:36

And that's not what she said in either of the email that we received from her until the very last, where she was like, I don't know how I can be more clear about these pipes.

SPEAKER_02 6:46

Yeah, and she never used the word pipe.

SPEAKER_01 6:48

It's the first time you've used the word pipe, honey.

SPEAKER_02 6:51

Yeah, yeah, honey.

SPEAKER_01 6:53

Yeah, honey.

SPEAKER_02 6:54

So so if you share your home inspection report with uh loan officer, there who knows? They I really wonder about their training sometimes or what their role is because there is any training. I will see them like, hey, there's water down here. We need a whole structural engineer. I'm like, do you really? No, I don't think so. Or that lady there, she wants to know if the pipes were busting causing a leak. So I'm like, and she never even mentioned that. So when we get a request for this, hey, can you kind of write a letter explaining what the cause of this moisture in the basement, which is a common one? Can you explain the moisture in the basement? We're gonna we need to ground well, hey, what what exactly are you looking for? Are you looking for pipes, foundation issues? Uh what exactly are you looking for? Because it seems to be about the third time we asked the question of the legitimate. That's when we know exactly what they want. And then and then we can answer that because we don't want to answer, go, oh yeah, that's this is caused by this, this, and then that opened up another can of worms that they didn't need to know. Like that electric report did that they did not need to know.

SPEAKER_01 8:05

So if you are the buyer or the agent, tell your buyers do not share that inspection report with their loan officer, because we may see a little bit of mold somewhere, and now that opens up that opens up a moisture issue, that opens up remediation, that opens up testing, and we've had to do that too because somebody has inadvertently sent their report where we've then had to go out and test for it.

SPEAKER_02 8:32

Yes, I I remember going to do a it's never worthwhile to do a swab on something that's not even mold.

SPEAKER_01 8:39

No. But you have no choice.

What A Home Inspection Is Really

SPEAKER_02 8:42

Well, I we have to do it to help the client. But to help the client get the house bought that they want to buy, we have to go and help them out.

SPEAKER_01 8:52

And we will we'll do that, but so so keep in mind though, what the home inspection report is is it's a list of the conditions of that house at that specific point in time. And then you look at that and you go, Can I live with this? Can I fix the the issues, or do I care about the issues? Are they going to impact it if I sell the house again? And then you make your decision whether to buy the house or not, and then the rest of that report becomes your honeydew list, and you work on fixing stuff as you live there over the course of the next few years. And then by the time you're done, the house is in better shape than when you bought it, and hopefully you get a higher value for it when you sell it.

SPEAKER_02 9:34

Yeah, and most things in the Home Special Report are not big deals, but they're they're stuff you for you to be aware of, so you it helps you maintain the house. That is you will learn you know, five years worth of uh living your house, you will learn all that within the next couple hours during our inspection and get your report. That's you learn all that up front. So you know, like all right, there's a little bit of caulking and I need to uh touch that.

SPEAKER_01 9:57

Keep up on that, and it doesn't matter if your caulking job does not look good, you just do it, and as long as water's not getting back there, it doesn't matter how pretty it looks, you will get there with time. It just takes some practice.

No Perfect House And Reports

SPEAKER_02 10:11

I I I might doesn't matter if it's pretty, no, as long as it works. That is as far as my perspective, that's true. It as long as it works and it's safe, that is fine. I've had real estate agents go, Oh, this is such a beautiful house, it's perfect. Um, the inspector won't find any issues here for you, I'm sure.

SPEAKER_01 10:33

There's no perfect house.

SPEAKER_02 10:35

You you just told your a your client that you know nothing about houses, or you that you are that inexperienced, or you're willing to pull the wool over the eye, which there's always issues, brand new houses.

SPEAKER_01 10:48

So we we've been in business for almost 24 years. In 24 years, we have had two reports doing like sixteen hundred to two thousand a year, two reports in the course of twenty-four years that did not have a summary, and they were both condos.

SPEAKER_02 11:08

Yes, and our summaries take the bigger not bigger issues, but they take the more issue, the larger issues, puts me, puts them into a a summary. Does it automatically do safety?

SPEAKER_01 11:21

Oh, I thought it did. Okay, I'm sorry.

SPEAKER_02 11:23

No, no, a missing outlet cover, that's a miss that's the but over a certain number, though, right?

SPEAKER_01 11:29

Like more expensive fixes.

SPEAKER_02 11:30

You usually it's more expensive things, but even that's even that is variable. Well, on how people interpret what's what needs put in, that depends upon the person reader reading the client and and why what's I comfortable with? I had a house one time, lady did not want to buy the house because I had a gas stove. She was scared of gas. But I looked behind, like, listen, you have an electric hookup.

SPEAKER_01 11:57

Just take it out.

SPEAKER_02 11:58

Take this one, donate it, and then go get or sell it, and then use that money to buy yourself a new one. She's like, Oh, okay. House sold. But it's it's silly stuff, but yeah, small, insignificant items do not make the summary report. So, all right, I think that's about it on this one.

SPEAKER_01 12:14

Bye, everybody.

SPEAKER_02 12:15

Bye bye.