Termite damage when buying a house: a deal breaker?

Is it bad to buy a house with termite damage?

Not by itself. Termite damage becomes a deal breaker when it reaches the framing and nobody can price the repair before your window closes. So book a licensed pest control company to inspect this week, then get a contractor's written bid on the damaged wood. With both numbers in hand, ask the seller to cover the treatment and the repair.

Key takeaways

• Treatment and repair are two bills from two trades, and the repair waits until a pest professional confirms the termites are gone.
• Repairs run from $565 for a small patch to $30,000 and up for severe structural damage at one Midwest pest company. Where the damage sits sets the price.
• Ask the seller for any termite bond and treatment records. Some bonds transfer with the house.

How bad is termite damage?

It depends on where the termites fed and for how long. The inspectors' trade group InterNACHI says wood-destroying insects "can cause serious problems in the wooden structural components of a house, and may go undetected for a long period of time." Subterranean termites do the most harm, and "damage usually is found before the termites are seen."

Orkin puts the worst case plainly: advanced damage "can greatly affect the structural integrity of your home, even causing ceilings or floors to collapse." Orkin adds that damage beyond repair is rare and comes from infestations left untreated for many years. Damage to trim or a window sill is carpentry. Damage to joists, beams or a load-bearing wall is a structural finding. Have a contractor or a structural engineer look at it before your deadline, not after.

Your home inspector found a sign, not the full extent. A licensed pest control company's inspection tells you whether termites are still active and how far the damage runs. On a Veterans Affairs (VA) loan, tell your lender now: Chase says a VA termite inspection is "almost always required if evidence of wood-destroying insect damage is noted in the independent appraisal." Soft wood elsewhere may be rot instead.

How much does termite damage cost to repair?

Cosmetic damage to trim is relatively cheap to fix. Damage inside walls or under floors costs more because of the labor to reach it.

These figures cover the repair only. Treatment is extra: the same Terminix office puts the average at $1,000 to $3,000, depending on how bad the infestation is. For a national marker, Orkin says termites damage about 600,000 U.S. homes a year, and a homeowner who finds the damage spends an average of $3,000 to repair it.

How is termite damage repaired?

Treatment first, carpentry second. A licensed pest control company treats the house. Orkin says repairs should wait until a licensed pest professional confirms no termites are left and the risk of new ones is gone. Then a contractor or carpenter fixes the wood.

The carpenter either replaces the damaged wood or adds a new support beside it. Adding a support is usually simpler and cheaper. Orkin calls replacing structural supports the most complicated job, and says the house needs temporary support while the work is done.

Get a written price from the pest company and another from the contractor. How to get repair estimates during the inspection period covers getting both before your deadline.

What should I ask the seller for?

Ask for treatment and repair together, as a completed repair or a credit. Each line names the scope, the trade and a figure.

Say your report flags termite damage to floor joists in the crawl space. Using the local figures above, treatment runs $1,000 to $3,000 in eastern North Carolina and the joists and subfloor run $2,000 to $7,000 or more around Des Moines, Kansas City and Omaha. That puts the line at $3,000 to $10,000 or more before your bids arrive. The request line reads:

Termite treatment by a licensed pest control company, then repair of damaged floor joists and subfloor in the crawl space: $3,000 to $10,000+. Written bids to follow.

Swap in the two written bids as soon as you have them. If the seller does the work, ask for the pest company's written clearance before the carpenter starts.

If your report has other lines too, Kept prices every line of an inspection report and marks the ones that need a professional's quote, for $79, usually under 4 hours. The rest of your list gets numbers while you wait on the termite bids. What to ask for after a home inspection covers which lines to include, and the buyer repair request letter template gives you the wording.

What if the seller says no?

You still have moves:

• Ask for a credit at the top of your bid range instead of the repair.
• Walk away if the bids come in above what the house is worth to you. If your inspection contingency allows, cancel inside the window. See when to walk away after a home inspection.
• Budget for it yourself if the bids fit and the house is otherwise right. Once you close, the repair is yours.

Your contract sets the exact dates and terms, so confirm them with your agent.

Does homeowners insurance cover termite damage?

Usually not. Allstate says "most homeowners insurance policies do not cover termite damage or removal, and preventing infestations is the homeowner's responsibility." It may pay only when termites cause a covered peril, such as a fire from chewed wiring. So ask for the money now, while the seller still owns the house.

Does a termite bond transfer to the new owner?

Sometimes. A termite bond is a service contract between the owner and a pest control company, and FindLaw says "some termite bonds are transferable to a new homeowner." Ask the seller for the bond and the treatment records, then call the pest company before closing to confirm what the bond covers and whether it moves to you.

How much should my whole repair request add up to?

The sum of real line items, not a round number. The termite line is the treatment bid plus the repair bid. Every other finding on the report adds its own priced line, and the total is your ask.

If termites are one line of a long report, upload your inspection report to Kept and spend your remaining days on the two bids that need a professional.

Sources

• InterNACHI, Termite Control in the Home
• Orkin, How to Repair Termite Damage
• Orkin, Termite Damage Statistics and Costs
• Homewyse, Cost to Repair Termite Damage
• Miller Pest Solutions, How Much Does Termite Damage Cost to Repair?
• Terminix, The True Cost of Termite Damage
• Allstate, Does My Homeowners Insurance Cover Termite Damage?
• FindLaw, Termite Bonds and Termite Letters
• Chase, A Guide to VA Loan Termite Inspection