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How to Ethically Refer Repairs

By Randy Yates

As a home inspector in an evolving industry, sooner or later you’ll probably be faced with the question of whether to refer your clients to qualified contractors who can repair the issues you find. Home inspectors used to not deal with this question at all—many worried (and many still do) about the liability involved, as well as appearing to have a conflict of interest.

As more millennial first-time homebuyers enter the market, however, this “hands-off” approach is quickly becoming outdated. The bottom line: millennials expect a higher level of service from anyone they do business with. In order to stay competitive, home inspectors have to look at new ways of referring repairs for their clients while avoiding potential ethical pitfalls.

1. Don’t Repair Items Yourself
You might think you’re going above and beyond by performing small repairs yourself as you see them. Replacing a burnt-out light bulb or tightening a loose drawer pull doesn’t seem like a big deal, but you should never repair any items in a home you’re inspecting. Your professional standards of practice dictate that an inspection should be visual and non-invasive, and performing repairs yourself, no matter how small, crosses that line and could potentially open you up to liability.

2. Never Take a Referral Fee
It’s a good idea to build and maintain a network of contractors that you trust, but you shouldn’t enter into any financial understandings with your contacts in exchange for referrals. This probably goes without saying, but you should only recommend a contractor because you trust them to do a quality job for your client at a fair price, not because you’re being paid to recommend them. Not only is this practice outside the line ethically, it can also come back to haunt you if the contractor you recommend ends up doing shoddy work.

3. Follow the Rule of Three
For any repair you recommend, you should have three names ready to give to your client. The Rule of Three perfectly balances being helpful to your client with avoiding the appearance of any conflicts of interest. By giving your client multiple options, you put the power in their hands to gauge the market rate for their repair and choose the best option for them.

Make the Most of Your NPI Franchise
At National Property Inspections, Inc., we’re here to help our franchisees navigate the details of the home inspection business. If you have any questions about inspection or how to market your business, we want to hear from you! Drop us a line at marketing@npiweb.com or give us a call at (800) 333-9807.

 

If you're interested in starting your own NPI franchise, you can request a free, no-obligation info packet at npifranchise.com.

 

About the Author
Randy Yates, Technical Consultant & Training Administrator
With over 19 years’ experience in his current position and more than 30 years’ experience in contracting, Randy’s main responsibility at NPI, Inc. is to provide ongoing technical support to NPI and GPI inspectors in the field. Randy also tracks state licensing programs and continuously updates our comprehensive training program to meet state requirements. He's available to support our franchisees 7 days a week.

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National Property Inspections, Inc. is a franchisor and does not perform inspection services.
All services are provided by locally owned and independently operated franchises.