Buying a home is equal parts thrilling and terrifying. On the one hand, there's the natural excitement that comes with new beginnings, but on the other, there's the anxiety that accompanies making the largest investment decision of your life (not to scare you even more).
Fresh paint, a new fence, maybe even some light remodeling — it's tough to find a house that's perfectly move-in ready with everything you want, and there may be certain projects you're prepared to tackle before you move in.
But what happens when the home inspection comes back with news you weren't expecting, like signs of termite damage? Should you buy a house with termite damage?
Contrary to what you may think, termite damage isn't a literal deal breaker. But it's nothing to brush off, either. Here are some things to consider if you find yourself in this situation:
First, make sure you get a Wood-Destroying Insect Report (WDIR)
Let's back up a bit. Most lenders require a termite inspection as part of the home-buying process, and it's not just a termite inspection but includes other wood-destroying insects like wood-boring beetles, carpenter ants and carpenter bees. But it's not always a guarantee. Make sure your home is inspected by a professional and that you receive a WDIR after the inspection takes place. This can save time and expedite the sale.
Also commonly referred to as a termite letter, a WDIR is an official document that confirms a home for sale has been inspected for any signs of wood-destroying insects and organisms. The letter details types of infestation and damage found and recommends any necessary treatments.
Assess the termite activity and damage location
If there is any termite damage reported on a WDIR, the damage should be evaluated by a building expert. The building expert's report should then be your guide on deciding whether or not to buy the house based on termite damage.
Here are a few scenarios of potential damage
Isolated damage caused by inactive termites
In this scenario, the damage can likely be fixed, and professional termite treatment and prevention can help ensure termites don't return.
Significant damage caused by a previous infestation that is now inactive
A termite infestation may have been treated and stopped, but the damage might not have been repaired. Make sure the damage doesn't affect critical parts of the home, like load-bearing walls or floor joists. If damages and repairs are listed on the letter, have a licensed contractor inspect the areas.
Active termites but no damage reported
This sounds like a big red flag, but an active infestation can be remedied with a reliable termite control plan. First check to see if the home is currently under a termite contract. If so, have the seller's agent contact the termite control company, and if not then contact a professional yourself for a customized recommendation for getting rid of the termite colony.
Active termites and significant damage
If there's an active infestation spread throughout the home, this may be a reason to terminate the sale. The necessary repairs may be too extensive (and expensive) to tackle as a new homeowner.
Negotiate for repairs
While no one wants to hear that their potential new home has termite damage, the upside is that you may be able to use this as a bargaining chip on cost.
If the home has signs of damage, either the seller needs to make the acceptable repairs based on the building contractor's estimates before the closing or the buyer needs to receive compensation for having to undertake the repair. After the damage inspection is completed by a licensed contractor, the money to repair the damage based on the contractor's estimates can be placed in escrow. Your realtor can offer valuable assistance in this area, but it doesn't hurt to brush up on your bargaining skills.
Invest in a professional termite treatment plan
Finally, if you've done your due diligence, settled on terms with the seller and are ready to move forward with your home purchase, the next thing you need to do is sign up for a preventive termite service.
Investing in a quality service now may prevent more expensive repairs down the road.