Buyer Q&A: What Happens if the Inspection Reveals Problems?

So you've found your dream home, made an offer, and it's been accepted—congratulations! But then comes the home inspection, and suddenly you're wondering: what happens if the home inspector finds problems? It's one of the most common questions we hear from buyers, and honestly, it's a really smart thing to be thinking about.

Here's the good news: finding issues during a home inspection doesn't automatically mean the deal is dead. In fact, it's pretty rare for an inspection to come back completely clean. Most homes have at least a few items that need attention. The key is understanding what happens next and how to navigate the situation like a pro.

Let's walk through everything you need to know about dealing with inspection problems, so you can feel confident no matter what the report reveals.

Understanding Your Home Inspection Contingency

First things first—let's talk about your inspection contingency. This is the safety net built into most purchase agreements that protects you as a buyer. When you include an inspection contingency in your offer, you're essentially saying, "I want to buy this house, but I need to make sure there aren't any deal-breaking issues first."

This contingency gives you a specific window of time (usually 7-10 days, though it varies by market and contract) to have the property professionally inspected. If problems are discovered, you have options. You're not locked into the purchase no matter what.

What does a home inspection contingency allow you to do?

Your inspection contingency typically gives you the right to:

• Request repairs from the seller
• Ask for a price reduction or credit toward closing costs
• Renegotiate the purchase price based on findings
• Walk away from the deal entirely and get your earnest money back

The specific language in your contract matters, so make sure you understand the terms before you sign. Your real estate agent (that's where we come in!) will help you navigate these details.

When the Inspection Report Arrives: What to Expect

Home inspection reports can feel overwhelming. You might receive a 40, 50, or even 60-page document with photos, descriptions, and lists of issues ranging from minor maintenance items to major safety concerns.

Take a deep breath. Not every item in that report is a crisis.

Professional home inspectors are thorough—that's their job. They'll document everything from a missing outlet cover to a crack in the foundation. But here's what you need to understand: there's a huge difference between minor cosmetic issues, routine maintenance items, and serious structural or safety problems.

How to categorize inspection findings

When reviewing your inspection report, it helps to sort issues into categories:

Safety hazards are your top priority. These include things like electrical problems, fire hazards, structural issues, or anything that could pose an immediate danger to occupants. These are typically non-negotiable items that need to be addressed.

Major systems and structural concerns come next. We're talking about the roof, foundation, HVAC system, plumbing, and electrical systems. If these major components are failing or near the end of their lifespan, they can cost thousands (or tens of thousands) of dollars to repair or replace.

Minor repairs and maintenance items are the little things that pop up in almost every home. A leaky faucet, a cracked window pane, missing weather stripping, or worn caulking around the tub. These are normal and expected.

Cosmetic issues are purely aesthetic and shouldn't typically be part of your negotiation unless they're extensive or you specifically negotiated that the home would be in move-in condition.

What Are Your Options After a Bad Home Inspection?

So the report is in your hands, and there are issues. Now what? You have several paths forward, and the right choice depends on what was found, your budget, and how much you love the house.

Option 1: Request Repairs from the Seller

This is often the first approach buyers take. You can ask the seller to fix specific issues before closing. This works best for clearly defined problems with straightforward solutions.

For example, if the inspection reveals that the furnace isn't working properly, you might request that the seller repair or replace it before the closing date. If there's a roof leak, you could ask the seller to have it professionally repaired.

The upside: Problems are fixed before you move in, and you don't have to deal with contractors or worry about the quality of work (assuming you require licensed professionals and proper permits).

The downside: You don't control who does the work or exactly how it's done. Sometimes sellers opt for the cheapest fix rather than the best long-term solution. Also, in a hot seller's market, sellers might simply refuse and wait for another buyer who won't ask for repairs.

Option 2: Ask for a Price Reduction or Closing Cost Credit

Instead of having the seller make repairs, you can negotiate a lower purchase price or request a credit at closing to cover the cost of repairs you'll make yourself after you own the home.

This approach gives you more control. You can choose your own contractors, ensure quality work, and make decisions about exactly how you want things fixed. Plus, you can shop around for the best prices.

For instance, if the inspection reveals that the home needs a new roof that would cost approximately $12,000, you might negotiate a $12,000 credit at closing or a $12,000 reduction in the purchase price.

The upside: You have complete control over repairs and can ensure quality work from contractors you trust.

The downside: You'll need to have enough cash on hand or available credit to cover the repairs after closing. Your lender may also have concerns if the issues affect the home's ability to qualify for financing (more on that below).

Option 3: Accept the Home As-Is

Sometimes, especially in competitive markets, buyers choose to move forward without requesting any repairs or concessions. This might make sense if the issues are truly minor, if you're getting a great deal on the house already, or if you're prepared to handle the repairs yourself.

Maybe you're planning a major renovation anyway, or perhaps the issues are things you know you can easily fix. Just make sure you're making this decision with your eyes wide open and a realistic budget in mind.

Option 4: Walk Away from the Purchase

If the inspection reveals serious problems that the seller won't address, or if the cost of repairs is more than you can afford, you can use your inspection contingency to cancel the contract and get your earnest money back.

This isn't failure—it's protecting yourself from a bad investment. Sometimes walking away is the smartest financial decision you can make, even if you're emotionally attached to the property.

How Do You Decide What to Ask For?

This is where having an experienced real estate agent really pays off. Not every issue deserves to be part of the negotiation, and asking for too much (or asking for the wrong things) can backfire.

Focus on the big-ticket items

Concentrate your negotiation on safety issues, major system failures, and expensive repairs. These are the items that could affect your safety, the home's value, or your wallet in a significant way.

A roof that needs replacement in the next year or two? That's worth negotiating. The water heater that's past its expected lifespan? Definitely bring it up. Foundation cracks that could indicate structural problems? Absolutely address those.

But asking the seller to replace all the burned-out light bulbs or fix every little cosmetic flaw? That's likely to annoy sellers and potentially derail negotiations over relatively minor costs.

Consider the market conditions

In a strong seller's market, you may have less leverage. If there are multiple buyers waiting in the wings, sellers might be less willing to negotiate on repairs. In a buyer's market, you'll typically have more room to negotiate.

Your agent will help you understand the current market dynamics and advise you on what's reasonable to request given the circumstances.

Get estimates for major repairs

Before you negotiate, it's helpful to get actual estimates for significant repairs. If the inspection says the HVAC system is at the end of its life, call a few HVAC companies and get quotes for replacement. This gives you concrete numbers to work with rather than guessing.

Having real estimates makes your request more reasonable and harder for sellers to dispute. It also helps you understand the true cost of homeownership for this particular property.

What If the Seller Refuses to Make Repairs?

So you've submitted your repair request, and the seller comes back with a firm "no." Now what?

Don't panic. Negotiation is a back-and-forth process. The seller's initial response is rarely their final position.

Try to find middle ground

Maybe the seller won't fix everything, but they'll address the major safety issues. Or perhaps they won't make repairs, but they'll offer a closing cost credit. Look for compromises that work for both parties.

For example, if you requested $15,000 in repairs and they refuse, maybe they'd agree to a $7,500 credit and fix the one major electrical issue. That might be a workable solution.

Re-evaluate your priorities

Ask yourself: How much do I love this house? Can I afford to make these repairs myself? Are the issues serious enough that I should walk away?

Sometimes you'll decide the house is worth it even if the seller won't budge. Other times, you'll realize you're better off continuing your search.

Get a second opinion

If there's a major issue in dispute, consider getting a specialist to take a look. The general home inspector might flag a foundation crack, but a structural engineer can tell you whether it's a minor settling issue or a serious structural problem. This additional information can help you make a more informed decision.

When Does the Lender Get Involved?

Here's something many first-time buyers don't realize: if you're getting a mortgage, your lender has a say in things too. The lender wants to ensure they're financing a property that's worth the loan amount and meets certain safety and habitability standards.

If the inspection reveals significant issues—especially with major systems like the roof, foundation, electrical, or plumbing—the lender might require those items to be repaired before they'll approve the loan. In some cases, they might require a lower appraised value, which affects your loan amount.

For FHA loans, VA loans, and USDA loans, there are specific property requirements. Issues that might be negotiable on a conventional loan could be deal-breakers for government-backed loans.

This is another reason why having an experienced agent and loan officer on your team is so important. They'll help you understand how inspection findings might impact your financing and guide you accordingly.

What About Issues You Knew About Before the Inspection?

Let's say the seller disclosed in advance that the roof is old or the AC unit doesn't work. Can you still use inspection findings to negotiate?

Generally, yes—but your leverage is weaker. If you agreed to purchase the home knowing about certain issues, it's harder to use those same issues as grounds for renegotiation later.

However, if the inspection reveals that the "old roof" is actually leaking and has caused water damage inside the attic, or that the "non-working AC" has also damaged other parts of the HVAC system, those are new problems beyond what was disclosed. Those additional issues are fair game for negotiation.

Real Talk: How Often Do Deals Fall Through After Inspection?

In our experience, most deals do NOT fall apart because of inspection issues. Buyers and sellers usually find a way to work things out, whether through repairs, credits, price adjustments, or a combination of approaches.

That said, some deals do end during the inspection period, and that's okay. Better to discover major problems now than after you've signed the closing papers and taken ownership.

According to industry data, roughly 10-15% of home sales fall through after the inspection phase, and most of those are due to buyers discovering issues they simply can't afford to fix or sellers refusing to negotiate on serious problems.

Tips for a Smooth Inspection Negotiation

Based on years of helping buyers navigate this process, here are our top tips for handling inspection issues like a pro:

Attend the inspection if possible. Being there allows you to ask questions and see issues firsthand, which helps you understand the severity of problems and make better decisions.

Read the entire report carefully. Don't just skim the summary. Understanding all the details helps you prioritize what matters most.

Work with your agent to craft a reasonable request. Don't ask for everything—focus on what truly matters. A well-thought-out, reasonable repair request is more likely to be accepted.

Be prepared to compromise. Flexibility often leads to better outcomes than digging in your heels on every minor issue.

Keep emotions in check. Yes, it's stressful to discover problems with a home you're excited about. But making decisions from a place of fear or frustration rarely works out well. Take a breath, review the facts, and make logical decisions.

Remember that all homes have issues. The question isn't whether problems exist—it's whether they're manageable or deal-breakers for your situation.

Moving Forward with Confidence

Discovering problems during a home inspection doesn't have to derail your home-buying journey. In fact, it's an opportunity to make an informed decision and potentially negotiate a better deal.

The inspection process is designed to protect you. It gives you a clear picture of what you're buying and leverage to ensure you're not taking on more than you bargained for. Whether you negotiate repairs, adjust the price, or decide to walk away, you're making the choice that's right for you based on real information.

At The Lutkins Group, we've helped countless buyers navigate inspection issues and come out the other side with homes they love and purchases they feel confident about. We're here to guide you through every step, explain your options clearly, and negotiate on your behalf to get you the best possible outcome.

Questions about home inspections or the buying process? We're always here to help. Reach out anytime—we'd love to chat about your home-buying journey.

Ready to start your home search? Contact The Lutkins Group today. We'll make sure you're protected every step of the way, from your initial offer through closing day and beyond.