Writing a Findings Letter Buyers, Sellers and Lenders Can Use

Why this matters

Your invoice is read by one person. A findings letter written during a home sale is read by the buyer, both agents, possibly the seller, sometimes an underwriter, and occasionally, two years later, a lawyer trying to establish what you knew. It gets forwarded without you, quoted out of context, and stapled to a repair addendum. Write it so every one of those readers gets the same, accurate answer, and so no sentence in it promises more than you did.

Who reads it and what each needs

• The buyer wants to know whether to worry and how much.
• The buyer's agent wants language they can paste into a repair request.
• The seller and listing agent want to know whether the finding is real and whether a cheaper fix exists.
• A lender or appraiser, when repairs are a loan condition, wants evidence a specific item was completed, which is a different document from findings. See related: Completing Appraisal Required Repairs.
• A lawyer, later, wants to know exactly what you were asked to do, what you did, what you did not do, and what you said.

One letter can serve the first four if it is factual and scoped. It serves the fifth reader only if every limitation is in writing.

Building the letter, section by section

Each section below is one block of the letter. The reason each exists is what breaks if you leave it out.

1. Header: property, date, who engaged you, who it is for. Put the property address, the visit date and time, the name of the person who ordered the work, and the phrase "prepared for" with that person's name. Leave this out and the letter becomes anyone's to rely on, including parties you never agreed to serve. See related: Who Is Your Customer in a Real Estate Deal.

2. The question you were asked. Quote the inspection report line you are responding to, with its item number and the report date. Without it, a reader cannot tell whether you answered the inspector's concern or a different one.

3. Scope. One or two sentences: what you evaluated, and in the same sentence, what you did not. "Evaluation was limited to the water heater and its venting and relief components. No other plumbing was evaluated." This is the sentence that protects you most and the one most often missing.

4. Conditions observed. Plain factual statements of what you saw and measured, each in a separate line, written as observations rather than conclusions: what, where, how measured. Use numbers where you have them. Skip this and your recommendation floats with nothing under it.

5. Tested and not tested. What you operated or measured, and what you could not test and why: utility off, access blocked, owner declined permission, weather. This is the section a buyer's lawyer reads first, because an untested item described as "fine" is the classic post-closing claim.

6. Recommendations. What should be done about each condition, in priority order, with the safety items first and labeled as such. Recommend correction, not a brand or a product. If a price belongs in the conversation, put it on a separate estimate and refer to it; a price inside the letter gets read as the whole story and quoted as the credit figure. See related: Repair Versus Credit at Closing.

7. Limitations. A short paragraph stating that the letter reflects conditions observed on the visit date, that it is not a warranty or a guarantee of future performance, and that it is not a code compliance certification. Keep it short and specific; a page of boilerplate gets skipped by the reader and does not do more legal work for its length. Whether any disclaimer language holds up in a dispute is a question for your own attorney, so have them review your standard paragraph once.

8. Signature and credentials. Name, license number where your trade is licensed, company, and contact. A letter with no license number is weaker evidence that a licensed professional performed the evaluation the inspector asked for.

The words that cause trouble

A few phrases do more damage in these letters than anything else:

• "Passed," "good condition," "no problems found." You did not inspect for "no problems"; you evaluated a scope. Write what you observed.
• "Should last another N years." A forecast nobody can make, read back to you when it fails.
• "Meets code." Unless you are citing a specific requirement for a specific condition, say "installed in accordance with" or "not installed in accordance with" the requirement, and name it.
• "Recommend replacement" when the finding was age. Say the age and the condition, and let the buyer decide.
• Hedging that hides a finding. "Possible minor concern" over a condition that is a safety defect is not tact. See related: The Agent Asks You to Make It Pass.

Worked example: the water heater letter

A buyer's agent orders an evaluation of report item 12.2: "Water heater TPR valve discharge line terminates 18 inches above floor; recommend evaluation by licensed plumber." On site the plumber finds the discharge line as described, plus a gas vent connector with no upward pitch over its horizontal run and a slight scorch mark at the draft hood. The tech runs the heater and does a spillage test at the draft hood after five minutes of burner operation, with the house in its normal configuration, and finds momentary spillage that clears at about 90 seconds. The CO reading in the ambient air near the heater stays at zero throughout on a personal monitor the tech wears from the moment the burner lights.

Here is the letter.

FINDINGS: WATER HEATER EVALUATION
Property:   418 Larch St
Visit:      May 6, 2:10 pm
Engaged by: J. Ortiz (buyer)
Prepared for: J. Ortiz

QUESTION
Inspection report of May 2, item 12.2:
TPR discharge terminates high.

SCOPE
Water heater, TPR valve and discharge,
gas vent connector. No other plumbing
or gas piping was evaluated.

CONDITIONS OBSERVED
1. TPR discharge ends 18 in above floor.
2. Vent connector: horizontal run with
   no upward pitch toward chimney.
3. Light scorching at draft hood rim.

TESTED
Burner operated 10 min. Spillage at
draft hood after 5 min: present,
cleared at about 90 sec.
NOT TESTED
TPR valve not manually operated
(owner declined, valve age unknown).

RECOMMENDATIONS (safety items first)
A. SAFETY: correct vent connector
   pitch and re-test draft.
B. Extend TPR discharge to within the
   distance of the floor required by
   the plumbing code adopted locally.

Conditions as observed on visit date.
Not a warranty or code certification.
M. Reyes, Lic. #____, Reyes Plumbing

Read it against the sections. Every block is there, and the order matters: the vent finding, which is a safety concern the inspector did not report, is recommendation A even though the buyer asked about the discharge line. The spillage observation gives its timing rather than a verdict. The TPR valve was not operated, and the reason is on the page, because a valve opened for the first time in years may not reseat and a plumber who opens it in a seller's house has just created a leak the seller did not authorize.

The price for both corrections went on a separate estimate. When the seller's agent asked whether "a quick fix" was possible on the vent, the plumber's answer was a correction to the connector, not a lesser one, and the letter already said why.

On the safety side of this example. The tech was standing at a draft hood with spillage present. That is why the personal CO monitor was on from burner light-off, and the shop's stop rule applies: had the ambient reading risen, the burner goes off, the occupants are told, and the appliance is tagged out of service until the vent is corrected, sale or no sale.

What would change the letter. Had the house been vacant with the gas off, conditions 2 and 3 could still be observed but nothing could be tested, and the TESTED block would say "Not tested: gas supply off at meter." Had the buyer also asked for a sewer evaluation, that is a second scope, and the SCOPE line would grow to name both rather than the letter quietly expanding.

Delivery and record

Send the letter as a PDF to the person who engaged you, and copy only the people they name in writing. Attach the photos you took of each observed condition, labeled with the condition number. Keep the letter, photos, readings and the original request in the job record; when a sale goes sideways months later, the job record is where you will look. See related: The Buyer and the Seller Both Want Your Report, The Buyer Sues After Closing and Names You.

How to verify the letter before it goes

Read it as the buyer's lawyer would, one question per section: who asked for this, what did they ask, what exactly was looked at, what was seen, what was tested and how, what was not tested and why, and what is recommended. If any answer is missing or has to be inferred, fix that section. Then search the letter for "good," "fine," "pass," "code" and "years." Each one should either be gone or tied to a specific observed fact.

References

• The plumbing and fuel gas codes adopted by your jurisdiction, for relief valve discharge termination and vent connector requirements
• Water heater manufacturer installation instructions for venting and relief valve discharge
• See related: Reading a Home Inspection Report as a Trade, The Recommend Further Evaluation Call
• See related: Documenting a Pre-Sale Repair for the Buyer's File, Liability When a Buyer Relies on Your Estimate