New rules passed by the provincial government will require resale home inspectors to be fully licensed by the province. The Home Inspection Business Regulation also requires licensed inspectors to carry $1 million in errors and omissions insurance and post a $10,000 security to cover consumer losses if they fail to do their jobs. The new rules also ban contracts that limit liability, establishes minimum qualifications and allows for prosecution under the Fair Trading Act, with a maximum fine of $100,000.
Previously, the home inspection industry was totally unregulated in Alberta, leaving consumers vulnerable to minimally trained, under insured home inspectors and little to no protection should an error be made in the home inspection. Although many of Alberta’s inspectors already adhere to the regulations set out by the province, the new rules will standardize training, licensing and the services offered by these professionals.
Read a detailed article that appeared in Friday’s Edmonton Journal here.
Although the inspection is not usually a required step for the mortgage financing process, we always recommend a full home inspection prior to finalizing the purchase contract. I can’t tell you how many clients have had to back away from the purchase of a home they thought was perfect due to unseen water or fire damage or electrical and plumbing issues.
Had these home buyers not chosen to have a home inspection, they may have been saddled with property headaches that were beyond their financial capability.
However, inspections can be expensive and that’s a big reason why many home buyers shy away from them. These new rules and the changes to the inspection industry that will follow should at least ensure that the outlay of cash for this very important step in the home buying process is worth it.
Need a referral for a trusted home inspector? Contact one of our licensed mortgage brokerd for more information.