I, Al Austin, am as far as is known the only Independent inspector in the whole Greater Houston Area who is willing to publicly sign a pledge of independence and to keep very clean ethics. I work only for the interests of my clients. That is NOT going to change. PERIOD.

There are few Independent inspectors in the entire US. Many inspectors are dependant on referrals from real estate agents and brokers who want the inspection to "easily pass without any problems". There is an obvious conflict of interests in working for anyone other than one's clients. Surprisingly there are a number of directors of inspection groups that have no problem with working for the interests of the agents over the more appropriate interests of their own clients. Obviously there are is far too much greed and graft at work in the real estate industry. That kind of corruption may be at home in large unethical corporations and in the US capital and some state houses because of lobbying of corrupt politicians. It however is in direct conflict with the consumer's welfare. More legal activity is needed to protect the public from the unscrupulous  who pander to questionable opportunistic entities.

  • You deserve an Independent evaluation of the property.

 

 

Complete Independence - Complete Confidence - Complete Trust

  • I am NOT associated with any real estate broker, agent, builder or any contractor. The point that needs to clear is that many real estate agents (including subagents) are working in the best interest of their client (the seller) and home inspectors "should" be working solely in the best interest of their client (the buyer). For an inspector to provide primary services to the agent needs is an inbuilt conflict of interests that is both illegal and unethical. It is amazing how many unethical inspectors there are in this region that are being allowed to operate in a questionable manner. Some operate for the benefit of the real estate agents in order to get referrals.  
  • I will NOT recommend any one whose interests, profits or commission might possibly conflict with myself or with those of the buyer.  
  • I have NO alliances with realtors, builders, security companies, contractors, or any other entity that would possibly undermine your confidence in my impartial objectivity.  
  • I do NOT provide any repair services or referral activities. So I don't recommend anyone at all. 
  • Unlike some less than ethical inspectors give or take "kick backs". For example there are reports of over 65 inspectors in the Houston area alone that DO accept "special payments" from just one particular (un-named but very well known security company) source. Using these inspectors can be very risky. 
  • I do NOT market or report to real estate agents. Doing so has an immediate inbuilt quid pro quo. I owe agents nothing other than the common courtesy that would normally be extended to any other person.
  • When you hire me for your home inspection, I work for you alone. I have no connection or obligation to the sellers of the property or the real estate agents involved in the transaction. My sole priority and goal is to get you the information you need in order to make an informed decision on the purchase of the property.

  • Special note to interested parties. I work solely for the benefit of my clients (who are almost always the buyers.) I avoid the obvious conflict of interests associated with soliciting or receiving referrals from any real estate agents, brokers, security companies, repair contractors and others who might want to have an indirect influence on the property.  I will continue for many years to give superior inspection services that aid the buyer’s need for a clear evaluation of the true condition of the property.  I prefer to stand on the side of fairness for consumer relations, open integrity and absolute honesty. Luckily I can avoid the corruption that exists in some areas of the real estate business. I will not be detoured from the most honest path chosen.

  • It is a sad fact that survival in the US home inspection business in 2004  requires a home inspector to choose one of the following two paths:

    1.Visit a few real estate offices and let unethical agents know you want to join their "sales team".  In order to do so the inspector must knowingly be unethical and under report issues or gloss over major problems in order to obtain continued referrals from unethical real estate sales people. This method requires virtually no marketing efforts or expense. It is a cheap way to make a great amount of money in a short period of time. After a few years the claims start coming in, errors and omissions insurance gets canceled, sleep gets lost over the impending law suits and claims, phone messages are not returned because the inspector knows or fears they are complaints, the home inspectors license then gets suspended (in the few states that require insurance) due to the lack of insurance, pressure mounts, bankruptcy is declared and former clients get stuck with defective houses with no compensation for the flawed house inspection.

    For a few years an unethical home inspector could make a fortune by dealing with fellow unethical people, which in turn harms home buyers and destroys the integrity of honest home inspectors. Inspectors who choose this path must be on the lookout for former clients and client's attorneys.

    2. An inspector can take the honest professional business approach by telling clients what they need to hear. This drastically increases marketing efforts and expenses, costs that must be passed on to clients. Clients must be made aware of the reason for the additional costs and why the benefits they will obtain outweigh the additional expense. The long term benefit is that the ethical home inspector will still obtain some referrals from ethical sales people and many referrals from previous clients. Clients will pay a little more for the inspection however; they will save huge amounts of money. Short term savings will occur during negotiations with the seller and long term savings will be realized since problems with the home would have been disclosed and remedied earlier.

    By choosing the latter method of conducting business I have been able to stay in business since 1993 and can stay in business for as long as I wish. I can sleep at night and look my self in the mirror at will. If I see a former client on the other side of the street I can cross the street and greet them with a smile and an outstretched hand.

    It is sad but true:  Make sure you ask the  home inspectors you speak with if they will be working for you or your realtor.

     

  • DETECTING & PREVENTING FRAUD & KICKBACKS Summarized below is a workshop presented at the 17th annual Cooperative Housing Conference

    According to Mindy Eisenberg, a CPA and certified fraud examiner who is a partner in the firm of Eisenberg & Krauskopf, there are two broad categories of management wrongdoing: the kind that happens on the corporation's books and records, and the kind that flows under the table. Kickbacks are an example of the latter, where you overpay for a good or service and the vendor gives the extra money to your management company or your agent or super, or even to a board member, as a "thank you" for hiring them.

    In a typical example, the ABC Management Company would hire a plumber on your building's behalf. The plumber charges $2,000 for the repair, and a check for that amount is cut from the building's bank account. The plumbing company then gives $300 in cash to your managing agent. Such an act is difficult to uncover. There's a bill for $2,000, which the treasurer has seen, there's a check that's been properly signed, and the board authorized the expenditure. "No matter how many accountants and forensic specialists you engage, you will have a hard time finding it," says Ms. Eisenberg.

    PREVENTION IS THE BEST DEFENSE
    While most managers are honest, and those who commit these acts are certainly the exception and not the rule, says Ms. Eisenberg, it always pays to be vigilant. The best defense against kickbacks is prevention, and there are a few safeguards you can put into place:

    1. Solicit sealed bids and open them before a group. Many boards allow the managing agent to get all the bids and bring a summary of the bids to a board meeting. This is asking for trouble. "You don't know that the manager didn't tell a preferred vendor what the other companies were bidding," says Ms. Eisenberg. "He could say that he has three bids at $1,500, so if his vendor comes in at $1,200 he's guaranteed to get this project. Nor do you know whether this work is worth $1,500, or even $1,200."

    While it may be time-consuming, the board should gather some of the bids itself. This will not only help head off a manager-vendor tryst, but it will give the board a better sense of what the job should really cost. When you receive the bids, open them at the board meeting. Never allow the managing agent to open bids at his office and hand you a summary.

    2. Hire an engineer. The bidding process is worthless unless there's a level playing field. An engineer will draw up specifications that can be sent to each bidding vendor, giving the board a reasonable standard for comparison. You may not find this necessary on a smaller job, but it should be your operating procedure on all larger expenditures. Another note of caution: Don't rely solely on your managing agent to help you choose engineers, and don't allow your engineer to gather bids from contractors.

    3. Check prices. With smaller projects and purchases, legwork is the best weapon against ripoffs. A board member should call various suppliers to find out what they are charging for commonly-used items. If you suspect that supplies are disappearing or not even arriving at the building, conduct random inspections of supply orders when they arrive and periodically check in the supply room to see how fast these items are being depleted.

    4. Don't grow too fond of vendors. There are persuasive reasons for establishing relationships with vendors and contractors. For example, if you use the same plumber on many jobs, it is likely that you will get better prices. But in using the same vendor or contractor year in and year out, you can lose sight of market prices. To keep vendors on their toes, review one or two vendors each year. If you find that the contractors you are using are offering bids that are in line and competitive with other bids you receive, then you will have a greater degree of comfort. In addition, "doing this sends a signal to your present contractors that if they want to stay on the property, they need to sharpen their pencils and come up with the best price for you," says Ms. Eisenberg.

    Overcharging could be indicative of fraud and kickbacks. If you find overcharging, then you should begin looking into this possibility.

    5. Don't rubber-stamp expenditures. When it comes to board approval of expenditures, boards err at both ends of the spectrum. Some boards approve all outlays without looking into them, while others take a magnifying glass to every bill. The former opens you up to rampant abuse, while the latter is too time-consuming and probably not necessary. The most practical approach is to consent to routine expenditures, with periodic reviews, while looking closely at larger or non-recurring expenses. This shows the agent that you're watching the store.

  • You deserve to know about a potential new home in detail before the closing. house-bit.gif (38067 bytes)

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