A home inspection is typically a part of every real estate purchase transaction. While the appraisal provides an estimate of value for the lender or seller, the home inspection provides the buyer with a report on the condition of the property. A typical home inspection report addresses the following items:

• Exterior - Soil conditions, foundation, general site conditions, exterior structure, and roof system
• Major house systems - Mechanical, electrical, and plumbing
• Interior - Kitchen, laundry area, bathrooms, fireplace and/or wood stoves, interior rooms, attic, raised foundations, and basements
• Environmental hazards - Asbestos, radon, lead, underground storage tanks (USTs), formaldehyde, mold, mildew, fungi, and meth lab contamination

In most cases, the lender and mortgage broker never see the buyer's home inspection report, as the items identified in the report that need correction are negotiated between the seller and buyer outside of the loan process. However, the lender may become aware of major issues relating to property conditions in the appraisal report. Sometimes the lender will require that certain conditions relating to the property be certified by an expert. An example would be a requirement that the roof condition can be certified to last at least 5 years.