We’ve had a busy year with real estate trading hands. With so much action in the market, we get lots of questions from new homeowners regarding their home inspections. One of the most common questions I get is: What is a 4 point inspection and does it satisfy the need for a real estate inspection?
The short answer: No.
What is a 4 Point Inspection?
Before I get into the differences between a 4 point inspection and a buyers inspection, we should first define them.
Four point inspections are the tools that insurance underwriters and insurance companies use to determine risk. As you might have guessed, there are four main things that are being examined during a 4-point inspection:
- Electrical system,
- Roof and Structural Integrity, and
- HVAC system (heating, ventilation, and air conditioning).
A home inspector has the option to list the age, overall condition, material, and basic type for each of these categories. For example, is the roof made of shingles or tile? Is the electrical wiring copper or aluminum? How old is the HVAC system? Who manufactured the electrical panel?
As with any inspection, licensed inspectors complete a report of all their findings for you to submit to your insurance company.
Why Do I Need a 4 Point Inspection?
Four point inspections help your insurance company determine the level of risk they are undertaking when providing you with coverage. Underwriters compile lots of data to help them predict how many claims homeowners will file (and, therefore, how much money they will have to pay out).
One such example of a “high risk” factor is polybutylene plumbing, as it was found to become brittle after exposure to certain elements in the water supply (therefore causing more leaks). Polybutylene pipes were even involved in a class action lawsuit, which led to the material being removed from the “acceptable plumbing” list in 1994.
However, contractors were allowed to exhaust their current stock, so I’ve seen it in houses built as late as 1998. The 3rd generation polybutylene pipes had no known failures, but insurance underwriters don’t make any concessions for that.
Your polybutylene plumbing may be in excellent condition with no history of leaks. You might even get years of service out of it. But if you have difficulty finding a reasonably priced homeowners insurance policy, it’s often easier to update your system.
How Does It Differ From a Buyer/Seller Inspection?
A full inspection, or a buyer’s inspection, is a lot more thorough.
When a home is under contract, there is a clause allowing for the buyers to get a full home inspection. If an inspection uncovers something the buyers don’t feel comfortable with, this clause allows them to void the contract and receive any earnest money back.
Because 4 point inspections only look at 4 points (the ones mentioned above), it doesn’t legally satisfy this clause. Therefore, even if the four point inspection shows that the roof is 20 years old, the buyers may not be able to get out of their contract.
However, it’s best not to view buyer’s inspections as legal requirements, but as a buyer relying on a professional home inspector’s educated and professional ability to help protect the buyer’s interest in the property.
It’s part of the old adage, “buyer beware.”
4 Point Inspection vs. Full Inspection
So what’s the difference between a 4 point inspection and a buyer’s inspection?
A full buyer’s inspection takes roughly two-and-a-half to three hours, while a 4 point inspection usually takes 20-30 minutes. While a four point inspection looks only at four things, a full inspection is exactly that: an inspection of the entire home.
Items examined include:
- structural integrity,
- HVAC system,
- electrical system,
- roof coverings,
- site conditions,
- plumbing fixtures,
- moisture intrusion or plumbing leaks,
- water damage,
- operation of toilets and sinks,
- grading of the site (which can affect drainage),
- operation of doors and windows,
- problems with the exterior cladding (siding),
- rotted fascia,
- and more.
Another notable difference is that buyer/seller inspections typically take place during the sale of a house, while 4 point inspections can be much more common.
Because it is your insurance company that requests the inspection, you may need to get one upon purchasing your home or when switching carriers. Even if you keep the same homeowners policy for decades, you may be asked to submit a 4 point inspection report when your home is 30 or 40 years old.
What Does a 4 Point Inspection Cost?
At EDC Professional Home Inspections, we do our best to maintain high quality standards while keeping the price affordable.
A four point inspection costs around $125 for homes in our service area. As a comparison, a full Orlando home inspection cost starts at around $350.
However, we always encourage homeowners to look at the qualifications and skill of their inspector rather than price. For most things you purchase, there is a return policy, but real estate is the exception. Knowing exactly what you’re getting into will keep you from unpleasant (and expensive) surprises later on.
If your insurance underwriter from the insurance companies are requiring you to get a 4 point inspection, don’t think that it will take the place of a full home inspection. Buyers should always hire a professional home inspector to perform a full inspection before purchasing a home. It’s a small price to pay to know that you’re investing wisely and understand the condition of your home.
Although all home inspections must be conducted to minimum state regulated standards, not all home inspectors are alike. At EDC Professional Home Inspections, we go above and beyond state standards to perform as thorough an inspection as possible. We inspect each home as if our own family were going to occupy it, which means you get unparalleled customer service with every home inspection.
Contact us to see the difference a true professional can make and schedule your certified home inspection.
Will an executed full inspection report satisfy the requirement for a homeowners policy in place of a Four Point inspection form.
Sorry Jim, No. Four point reports are specifically used for insurance and less detailed. But the perspective is different. Full Inspections are written primarily for buyer’s, but may be for seller’s. Four point inspections are written for the insurance underwriter to evaluate their risk in insuring the property.