Yelp referrals for home inspectors
Q: In one of your columns, a buyer was annoyed that her agent would not recommend a home inspector by name. I'm a Realtor, and our company has a policy against recommending any service providers. That includes termite inspectors and home inspectors. We simply advised them to use Yelp. Past experience has shown us that this is the safest way to do business. If a home inspector that we recommend makes a mistake, we could be sued for making that referral. We'd like to provide a list of reliable contractors and inspectors, but potential litigation is a real concern. How do you view this position?
A: The fear of litigation is understandable and is shared by many, not just in real estate profession, but in nearly every business; from grocers to doctors; from plumbers to engineers; from teachers to musicians. Trial attorneys, for whatever reasons, good or bad, have abolished the trust that was once affirmed by a promise and a handshake. Instead, we have lengthy contracts of fine-print legalese that no ordinary person can understand. Yet no contract eliminates the possibility of lawsuits. It merely provides talking points for that dreaded day in court. Fortunately, there are still ways to operate in this defensive environment, without abandoning the personal service that you would like to offer in good faith to your customers. So, let's apply this to the problem of referring home inspector by name to your clients.
The Yelp approach used by your company may not provide the liability protection that Realtors seek. In fact, it may pose a higher level of exposure to tort liability. The problem with a Yelp selection is that a buyer may randomly hire a home inspector who has very limited experience; someone who is not very thorough or qualified and who may fail to disclose significant property defects. If a buyer chooses a mediocre inspector and the agent fails to point out that there are better home inspectors available, that agent could be vulnerable to a lawsuit, without having made a referral.
Fortunately, there is a safer middle ground between recommending a home inspector sending client to the internet. Instead, you can provide a list of the most qualified home inspectors in the area and let your buyers choose an inspector from that list. In fact, you could ask a number of local home inspectors to submit a one-page flier outlining their professional credentials and their levels of experience in the inspection business. A packet of these fliers could then be given to every homebuyer. Buyers could select their own inspector, but their choice would be an educated one, based upon information that would facilitate a more thorough inspection and, therefore, less liability. Run that idea up the flagpole at your next staff meeting and see if anyone salutes it.
• Distributed by Action Coast Publishing. Questions to Barry Stone can be e-mailed to barry@housedetective.com.