The clause “inspection for informational purposes only” became popular in the competitive housing market during the pandemic. You may have seen it in an offer, or even used it yourself. While the term sounds simple, buyers and sellers don’t always agree on what it means once the purchase and sale agreement is signed.
An inspection for informational purposes only means the home inspection is for the buyer’s knowledge only, and won’t be used to negotiate over every minor issue. But the rules can vary by state, and misunderstandings can lead to conflicts during the sale.
Here’s what you need to know to navigate negotiations and set realistic expectations, whether you’re buying a home in Boston, MA, or selling in Los Angeles, CA.
What does “inspection for informational purposes only” mean?
An inspection for informational purposes only, sometimes called an “informational inspection” or “info-only inspection”, is a clause that allows buyers to complete a home inspection while:
- Agreeing not to request repairs or price reductions: Sometimes additional terms are added in case major work surfaces, like not requesting or negotiating repairs under $5,000.
- Releasing the seller from any obligation to fix issues: While sellers aren’t (usually) required to fix anything that comes up during the inspection, an informational inspection reduces the risk of negotiations or unexpected costs for the seller.
- Retaining the buyer’s right to walk away (depending on the contract): If the offer is accepted as an information only inspection, and maintains the inspection contingency, buyers can still walk away after the inspection. If an inspection for informational purposes only is combined with a waived inspection contingency, the buyer is likely locked into the contract.
The original purpose of the clause allowed for the buyer to gain knowledge about a home’s condition without creating additional negotiation hurdles for the…