[Termite Control] Becoming an Expert Termite Inspector

A termite inspection determines the absence or presence of visible evidence of termites (and other wood-destroying pests). It is not a guarantee that termites are not present in the structure, simply that a careful, professional inspection on that date and at that time found no visible evidence of termite or other wood-destroying pest infestation, past or present.

The inspector should report any evidence that is in, on, under or attached to the structure, including evidence in debris that may be present under a structure. The inspector should also look at decks, porches, storage sheds, and other subordinate structures that are permanently attached to the main structure.

Outbuildings, detached garages, sheds, lean-tos and other detached buildings, structures and fences are not usually included in a termite inspection unless specifically requested by the client, and should be noted as excluded on graphs and reports.

What if an inspector finds termites in mulch adjacent to the foundation? Termites found in mulch…even right next to the foundation…would not require treatment under current industry standards and practices, and so inspectors as a rule should not report them as infesting the structure, but may note their presence in the remarks section of an inspection form. During a real estate inspection, mulch should not be moved unless it obstructs access to wood siding. No excavation should be done beneath the mulch.

Termite inspectors should always review the scope of the inspection as described in the instructions included with the specific inspection form used, whether the National Pest Management Association’s NPMA-33 (Wood Destroying Inspect Inspection Report), a specific state form or another form.

"INACCESSIBLE AREA." All buildings have wood that is not visible or accessible. For an inspector to find evidence of termites in these areas would require extensive probing and dismantling of sections of the structure, which is not part of a typical termite inspection. Furthermore, access to some parts of a structure can be blocked or obstructed in some way. To some extent, what is an accessible area is subjective. What one inspector will decide to access, another inspector might not. A critical issue is to document in writing the areas that the inspector considered inaccessible at the time of the inspection.

Any area that cannot be inspected without opening the structure or removing objects blocking entry is typically considered inaccessible. Examples include a garage filled with stored items, a closet filled with boxes, a crawlspace filled with standing water, or an area under the porch filled with firewood.

How accessible a crawlspace is often depends on the size and flexibility of the inspector. Some state regulations specify what is inaccessible for a crawlspace, for example, less than 24 inches high. When using the NPMA-33 Wood Destroying Insect Inspection Report, the clearance required is at least 24 inches from crawl floor to bottom of floor joists. Also, any area that is unsafe is inaccessible. In general, inspectors are not required to access areas which require the breaking apart, dismantling, or removal of moldings, floor coverings, wall coverings, siding, ceiling, insulation, floors, furniture, appliances, personal possessions, and similar objects. Some companies consider an area inaccessible if it requires the use of a ladder or where access requires the use of a drill. According to the guidelines for NPMA-33, ladders are not required for a WDI inspection.

In certain instances, inspectors may want to investigate hidden areas, such as wall voids, when they have a strong reason to suspect a termite infestation exists. There are tools available, some high-tech and some not, that can detect termites in these hidden areas, and these tools and techniques are discussed in detail in the section on equipment in this book. But note that these tools are optional and are not required as standards of inspection for typical termite inspections.

REAL ESTATE INSPECTIONS. Many companies perform real estate inspections for home buyers and their mortgage companies. Real estate inspections are not a basis for major income but are primarily a marketing tool for selling termite control. Consider real estate inspections as a form of "prospecting" for new customers. If evidence of a termite infestation is found, the inspector has an opportunity to sell a termite job so the property can be sold. Some companies go further and offer a service to repair damage. These companies seek out Realtors and ask for their inspection business. They develop a relationship with the Realtors and the Realtors, in return, expect professional inspections and reports, regardless of what is found. Inspection fees are usually low due to competition so there is little profit in the inspection itself. The profit is in any subsequent termite job that results.

Real Estate Inspection Liability. Real estate inspections are fraught with great liability because they consist of a visual inspection of accessible areas. Buyers often renovate an area of their new home and find hidden termite damage and sometimes even live termites in an area that an inspector could not see or access on the day of the inspection. Some sellers hide damage or evidence of infestations to make the house easier to sell. Realtors occasionally encourage hiding infestation evidence or pressure the inspector to produce a "clean" report. Because of these kinds of pressures and problems, some companies will not make real estate inspections except for current customers.

Inspections are not covered by standard liability insurance. You need "errors and omissions" coverage. Some of these policies for inspection coverage have special requirements so read your policy carefully to be sure you conform. Otherwise, coverage may be denied for a future problem.

Lender Requirements for WDI Inspections. Traditionally, lenders have required a termite inspection in order to protect their investment (and, of course, the buyer) whenever a mortgage was issued on a home sale in a potential termite infestation area. This is the policy of the Federal Housing Administration (FHA) and most lenders follow this policy even though they are not legally required to do so. Misinterpretation of some recent minor changes in FHA policy has led many lenders and real estate agents to drop the termite inspection requirement for home sales, which in turn has shrunk the WDI inspection market.

The National Pest Management Association has been working to correct this problem but in the meantime provides a number of recommendations for termite control companies that work in areas where lenders have reduced or eliminated WDI inspection requirements.

Limited Tools Required. Real estate inspections require simple tools. Coveralls, bump cap, knee pads, dust mask/respirator, and gloves should be used for personal protection. A good, strong flashlight and a probing tool are the inspection tools required. A moisture meter is sometimes helpful. Special tools such as termite dogs, infrared detectors, x-rays and listening devices are available but numerous court cases have established that a flashlight and probing tool is the standard of the industry. The other special tools are more useful for addressing repeat termite problems. They are not practical nor are they required for a standard real estate inspection.

To reduce liability, some companies are now using digital cameras to record findings and obstructions. Garages filled with boxes, standing water in crawlspaces, cluttered attics, snow against the foundation, etc. can be visually preserved for posterity. These companies also store a digital image of the report on the same disc so everything is together for future reference. Discs and electronic files require far less storage space than do paper files (but should be backed up, of course).

Reports. Reports and data for real estate inspections are usually filed by address. The owner, buyer or Realtor may change in the future. You may be called upon to make another inspection on the same property in the future. Your record will show what was there originally. If a seller is trying to cover up something, your records from a prior inspection for that property may keep you out of a lawsuit.

NPMA-33 Wood Report. The NPMA-33 form is the standard wood-destroying insect inspection form and should be used if accepted by your state regulators. Some states require their own forms. This form has been reviewed by legal experts and protects you as much as a form can. If your state requires another form, then you must use that form. The NPMA-33 form is not a damage report form. You report the presence of WDI damage only as one additional piece of evidence of infestation, past or present. Reporting damage details and whether damage is structural was omitted from the NPMA-33 form in order to reduce liability for WDI inspectors, who are usually not qualified as damage experts or structural engineers. The form clearly states that if evidence of infestation is found, a qualified construction expert or engineer should inspect for damage.

If there is information that you believe a buyer should know about the property in question but that information is not covered by the form, add an attachment and indicate in the "Comments" section that an attachment is provided. You can add as many attachments as you feel necessary to protect yourself and to provide the buyer with useful information. An example would be a major decay problem in a crawlspace. The NPMA-33 form does not address decay but an attachment can do so. If you had inspected this property before and found heavy accessible damage which has now been repaired, the buyer should know this. There may be hidden damage which was never repaired but the buyer can pursue this if he/she so wishes. An attachment to the NPMA-33 form could address this information. Note, too, that NPMA recommends that companies always submit page two (consumer information) when using the NPMA-33 form.

Red Flags. If a Realtor calls you for an inspection and it is a Realtor you have never done business with before, beware. The Realtor’s usual inspector might have found evidence of infestation and the seller has now removed it. Now you are expected to do the inspection and issue a "clean" report. In some states, an inspector is required to place a sticker on the hot water heater, electrical panel, entrance to a crawlspace or other conspicuous place. Look for such a sticker to see if someone else has inspected the structure recently. If so, call them to see what they found.

Whether you are working with an unknown Realtor or not, look for evidence of a recent inspection. Probe marks in wood are one piece of such evidence. If you find any, be very cautious about issuing a report, especially if you can’t find any evidence of past infestation.

The other item often missed is evidence of a prior treatment. The most common is old drill hole patches in concrete. You should report this so the buyer knows there was a past problem. Recommend that the buyer ask the seller for any documentation of past treatments.

Finally, check your records to make sure you have never inspected or treated this property. If you have, check the file to see what was present earlier. Old, visible damage may have been repaired but there may still be hidden damage.

Bottom Line. When making a real estate inspection, put yourself in the buyer’s shoes. Report what you — as an educated buyer — would like or want to know about this property. This will minimize your liability and also provide the buyer with a real service.

Although there is little profit in real estate inspections, some companies put the new buyer on an annual inspection program. The fees charged usually produce little profit but the annual inspections may permit you to find other pest control problems that can be addressed for a profit. Some companies even offer a termite protection plan with an annual renewal for a higher fee. These can be profitable but are seen as selling "insurance" by some regulators.

TERMITE ReinspectionS. Periodic reinspections of treated homes under warranty are critical, both ethically and technically. A good, thorough inspection can identify a new infestation before it causes significant structural damage to a customer’s home, which, after all, is what the customer expects from his termite warranty. Termite reinspections are a concern for the Federal Trade Commission (FTC) and for some state regulatory agencies. The regulators’ interest in reinspections is driven by homeowner complaints of expensive termite damage to their homes that should have been discovered much earlier by their termite warranty company.

Homeowners often complain that "no one from the company has inspected this house for years" or that "the inspector came out, walked around the outside for three minutes, told me everything was okay, and left." When state inspectors check company records, they often find little or no documentation of the inspections that are required under the warranty and, depending on the state, by state regulations.

Regulators in several states are citing termite control companies (1) who fail to conduct periodic reinspections, (2) whose termite reinspections are considered inadequate, or (3) who can’t document that they attempted to schedule a reinspection but were unable to do so. The citations are for failure to honor a contract or for "negligent pest control."

Scheduling. Most termite jobs are sold during the swarming season, so the deadline for these annual reinspections will be next year’s swarming season, just when termite inspectors are most pressed for time. Scheduling conflicts and time constraints are the main reason that reinspections are skipped or done inadequately. You can avoid these problems by scheduling your reinspections for late fall and winter when work is slow. Begin planning so you can contact your customers early and budget your inspectors’ time for winter reinspections.

The Reinspection Process. An inspector should work as hard on a termite reinspection as on a real estate inspection, or as when prospecting for new termite jobs. That means 30-60 minutes for an average single family home. Require that your inspectors use a checklist to ensure that they inspect all the areas you want them to, and make sure that they have effective inspection equipment.

Because in winter the weather may be miserable, you need to ensure that your inspectors enter every accessible crawlspace, check the exterior for signs of moisture problems such as a wet foundation, damaged siding, peeling or discolored paint, mossy roof, water stains, icicles, ice dams, or sagging roof, check attached fences and all other sites generally considered as part of a good termite inspection. You may also want your inspectors to check tool sheds, unattached garages, and outbuildings (unless these sites are specifically excluded from your contract).

Documentation. Good records are important for your defense in front of a state regulator or if a termite customer takes you to court or to arbitration on a damage claim. You will have a weak (or impossible) position if your customer can successfully argue that the property had not been re-inspected, or that your reinspection was inadequate.

Document your attempts to schedule the reinspection with the client. Most companies use postcards, emails, or phone calls. Simply note on the customer’s record how and when the notification was attempted. Do the same with follow-up notifications. If the customer never responds, at least you can show through your records that you made the attempt to schedule the reinspection.

Practice defensive recordkeeping. Inspectors need to complete an inspection report and prepare a graph (or update a copy of the original) or take new photos. As with an initial inspection, your inspectors need to record all inaccessible and obstructed areas, special problems, and conditions conducive to infestation.

Inspectors should write down any comments by the customer that may have a bearing on current or future infestations ("I just had the roof repaired," or "I had to have the basement waterproofed," or "I just finished a landscaping project"). The inspector should use a camera to document special problems, conducive conditions, inaccessible sites, and similar issues.

Have your inspectors keep in mind that the next time they see their reinspection records might be in court.