The inspector was busy in the garage while the seller's cat and I did mortal combat - a fierce game of hide-and-seek around the kitchen. I was representing the buyers who were paying a small fortune for this house ($25K over asking price) but we had beat out many other offers and were feeling victorious.
The home was relatively new which gave some sense of (false) comfort that despite the price tag we'd likely face few issues on the inspection side. That was true until the inspector hollered for me to come take a close look at the wall. A series of little dots would turn both my buyer's and the seller's worlds upside down, and shake a lot of money from the seller's wallet. All over an issue that could have been prevented entirely.
"Termites," the inspector said flatly, pointing to three tiny holes in the painted garage wall a few feet above us. At worst, it looked like someone had simply scraped the wall during move-out.
"You're an idiot," I countered, ever so sweetly. "Termites eat cellulose, not drywall."
He leaned in, as if to burn three more holes through my head, and repeated with great deliberation while knocking on the wall: "These...are...TERMITES."
The sellers also challenged the diagnosis, adding that they had had a termite bond for years. At least...they thought they did. They agreed to cutting a patch out of the wall for further investigation. The patch became entire swaths of sheetrock ripped off the studs, revealing a superhighway of termites running up and down the framing, making an absolute feast of the wood holding up the house.
A structural engineer was called in. Everyone freaked out. Ultimately, about a quarter of the garage had to be re-framed entirely. What went wrong? The seller's had let the termite bond lapse by missing their annual inspection and in a short amount of time those little bastards had obliterated a large chunk of the garage. A missed $200 inspection cost them dearly.
What is a termite bond?
Termite bonds are considered so relevent (and valuable) that there is a special place on the MLS to identify whether or not a house has one. Termites are a fact of life living in Southeast North Carolina.
The bond is a contract between a homeowner and a pest company that transfers the liability of wood destroying insects off the owner. A pest company inspects the home (particularly underneath, along the foundation and around the window sills) for signs of active termites and past damage. They make notes and apply a treatment to ward off the bugs.
A bond isn't cheap - about $1000+ depending on square footage. But once its applied, so long as you maintain the bond via a yearly $200 inspection, you are off the hook should the termites ever reappear. Think of it as a warranty. If the termites ever come back or cause damage, that liability transfers onto the pest company.
Why Would Anyone Let a Bond Lapse!?
Because life happens. The pest company calls to reinspect and the homeowner forgets to call back. Its not an exciting $200 to spend. Or, they've looking in their crawl, didn't see anything and assumed the coast was clear.
Keep in mind that the signs of termites are almost always missed until they are so populated in the walls they start burrowing through drywall or become so numerous you spot one with your naked eye.
The "mud tunnels" they build up the sides of foundations are easy to miss in a dark crawl space, easy to mistake for "just dirt" and easy to hide behind boxes, tools or anything else against a garage wall.
Do I Need One?
I would never recommend a homeowner in this area forgo a termite bond but ultimately the choice (and risk) is yours to take.
If you have brand new construction, the house likely already has a bond on it. It's the best $200 you can spend to simply maintain it.
If you are selling your house, know that there is a specific designation on the MLS for buyers to review which acknowledges whether or not a house has an existing bond. Will someone not make an offer if you don't have a bond? Probably not. But it can give buyers peace of mind and can be used in negotiations. As a homeowner, you won't be biting your nails during inspections.
If you have a historic home: absolutely. I can almost guarantee the house has pre-existing damage from 100 years ago. While many buyers adore the character of old homes they are often consumed with the idea that they are universally all money pits and the presence of a termite bond takes the edge off. Ironically, much of the old growth wood in a historic home is now strong as steel and unpalatable to the termite.