You’ve accepted an offer, the deal is moving along nicely, and then the buyer schedules their inspection. Suddenly, everything feels uncertain again. If this sounds familiar, be assured it’s completely normal and nothing to worry about.Escrow inspections and appraisals are simply where buyers do their homework, and where sellers sometimes get a little nervous. But with the right preparation, these steps rarely cause issues with a property sale.
Here’s a quick look at what happens during escrow inspections and what to expect from the home appraisal process for sellers.
What Is Escrow, and Where Do Inspections Fit In?
Escrow is the neutral holding period between an accepted offer and the final sale. During this window, the buyer confirms the property’s condition and value before fully committing.Two key milestones sit in this phase: the inspection and the appraisal. Both protect the buyer, but they also give sellers a chance to move the deal forward with fewer surprises at closing.
Home Inspection During Escrow: What to Expect
The buyer often schedules a home inspection within the first week or two of escrow. A licensed inspector walks the property, checking everything from the foundation to the roof, to HVAC, plumbing, electrical, water heater, and windows. You name it, they check it.You don’t need to be there, and honestly, it’s probably better if you’re not. We might suggest you give the inspector space to do their job. Before they arrive, make sure all areas are accessible: unlock gates, clear storage from around the water heater and electrical panel, and replace any burnt-out bulbs. Small things, but they signal a well-maintained home.
What happens during escrow inspections that causes deals to stumble? Usually, it’s not one big issue, but more like a pile of small ones that spook the buyer. Leaky faucets, missing outlet covers, and an aging roof. That kind of thing. None are necessarily dealbreakers, but together they may invite renegotiation.
What Happens After the Inspection?
The inspector delivers a report to the buyer, who then decides how to proceed. In many cases, buyers request repairs or ask for a credit toward closing costs. Some ask for a price reduction.You’re not obligated to agree to everything. But refusing reasonable requests (especially safety-related ones) can push a buyer to walk. Your agent can help you figure out which items are worth addressing and which ones aren’t.
The Home Appraisal Process for Sellers
If the buyer is financing, their lender orders an appraisal. This is separate from the inspection. Where the inspector looks at condition, the appraiser looks at value. They compare your home to recent sales in the area and assess whether the agreed price makes sense.Sellers sometimes assume a clean house or fresh landscaping will boost the appraisal. It won’t, at least, not meaningfully. Appraisers care about square footage, location, comparable sales, and structural condition. Cosmetic upgrades rarely move the needle.
What If the Appraisal Comes in Low?
If the appraisal falls short of the purchase price, the lender won’t cover the gap. The buyer either pays the difference out of pocket, you agree to lower the price, or both sides meet somewhere in the middle. Sometimes, none of those happen, and the deal falls through.Low appraisals aren’t common, but they’re not rare either, especially in fast-moving Houston real estate markets where prices outpace recorded sales.
Appraisal vs. Inspection in Real Estate: Key Differences
People mix these up all the time, so let’s quickly break down the differences:- The inspection is ordered by the buyer to assess the condition
- The appraisal is ordered by the lender to confirm the value
- The inspection might lead to repair negotiations
- The appraisal might lead to price negotiations
- Both happen during escrow, but they serve different purposes
How Networth Builders Helps Sellers Through Escrow
Escrow inspections and appraisals feel like a minefield to many sellers, but they don’t have to. At Networth Builders, we prep you for what’s coming, manage communications with the buyer’s side, and help you respond strategically when requests come in.The goal is simple: remove stress and uncertainty, keep the deal on track, and get you to close of escrow without unnecessary drama.
Questions? Schedule a free consultation, and let’s talk about what happens during escrow inspections.