Concerned About Termite Damage To Your Prospective Home? What Are Your Options?

If you and your spouse have recently fallen in love with your dream home and put in an offer pending inspection, you may be dismayed to learn that the home you'd love to purchase has mild to moderate termite damage -- or worse, an active termite infestation. Depending upon the specific contents of your real estate contract, you could be free to request the return of your earnest money and continue your search, but in other cases, you might be forced to continue with the sale and even pay for repairs yourself after closing. What are your options when you hear about this termite damage? Read on to learn more about who is required to pay for termite repairs discovered during a home inspection, as well as some of your most effective and least expensive treatment options for termite elimination if you decide to proceed with the sale.

Who is required to pay for termite damage discovered during a pre-purchase inspection? 

The answer to this question depends largely upon the terms within your real estate contract. When you make an offer on a home and the seller accepts (or you accept the seller's counteroffer), you've created a binding contract that could cause financial damages to be levied on either party if the agreement is breached. In general, backing out of a sale after you've agreed to purchase a home for a specific price will result in the forfeiture of any earnest money you've deposited (usually a small percentage of the total home price). On the other hand, if the seller backs out after accepting your offer, you should be able to sue to recover liquidated damages. 

In most cases, an offer to purchase will contain a provision waiving the buyer's right to have the seller make certain repairs or remediate problems on their own dime. Unless an issue is one of physical safety (for example, lead contamination in the water), the seller will likely be off the hook when it comes to paying for and performing repairs. You may be able to use a property's newly-discovered termite infestation as a bargaining chip to lower the price or shift more of the closing costs to the seller, but in a hot housing market where most homes are receiving multiple offers, you do run the risk that a motivated seller will refuse your requests, let you breach the contract, pocket your earnest money, and then sell the home to the next highest bidder. 

Although most states' real estate laws require the seller to disclose any termite issues of which he or she is aware (or disclose that the home has previously been treated for termites), this isn't always a guarantee that you'll find out about termites before moving in; indeed, if the termite infestation is fairly recent or they are hidden deep within the walls, the homeowner may be completely unaware of the damage being caused. Because of this, it's always worthwhile to have a thorough home inspection before closing -- even losing your earnest money is better than buying a home with significant structural damage that isn't revealed until after the home is legally yours.

What are the best ways to eradicate termites quickly? 

If your real estate contract dictates that you must pay for termite remediation yourself, you have a few relatively low-cost options that should be enough to get rid of these pesky insects for good. 

First, you'll want to carefully inspect the perimeter of your new home to see if there is an obvious entry point. Termites are often able to tunnel into walls through wooden support beams buried in the dirt, so you'll want to check the exposed surfaces for small holes or signs of insect activity. You'll also want to clear out any brush or rotten limbs from the area immediately adjacent to your house -- placing the termites' meals in another location should make your home seem less appetizing.

Once you've taken steps to make your home less attractive to termites, you'll usually be able to interrupt their life cycle and prevent them from entering your home by treating the dirt surrounding your home with a liquid or gel insecticide. This substance interferes with the termites' ability to reproduce, quickly wiping out an entire colony within just a generation or two -- and without requiring your new home to be tented or bombed with heavy-duty insecticide powder.