The Hidden Risks of High Turnover and Outsourced Inspections

Not all third-party CRE inspectors are created equal. If you’re a lender, you need to ask: Is your inspection firm relying on a rotating door of independent contractors, or are you working with a dedicated, experienced professional?

The Problem with the 1099 Model

Many firms today operate on a 1099 model, meaning they outsource inspections to independent contractors instead of employing full-time, dedicated experts. While this approach might be profitable for the firm, it often leads to significant gaps in quality and consistency.

“The use of the 1099 model has, unfortunately, become more and more prevalent in the third-party inspection market,” says Stephanie Goins, Senior Vice President at CMR Partners. “In some cases, such as remote locations, this solution makes sense if strong parameters are in place. But often, a 1099 inspector is just a photographer sending pictures to a main office for processing—they’re not actively tracking for potential problems.”

A major red flag? If an inspector doesn’t seem to understand the full scope of a project. Without that crucial context, they can’t accurately verify work completion, detect potential financial manipulation, or spot construction discrepancies.

Lack of Accountability and Consistency

Another major issue with outsourced inspections is turnover. If you’ve noticed different inspectors coming to your site each time—without prior notice—you should question whether your project is truly a priority for that firm.

“You will find that the inspector cannot answer basic questions about the project,” Goins warns. “If you find yourself being passed from inspector to inspector with little or no notice, you need to ask yourself how important your job is to that organization.”

This inconsistency can create major delays and confusion. When an inspector lacks historical project knowledge, they may miss critical changes or fail to catch ongoing issues, putting the lender at risk.

How CMR Partners Does It Differently

At CMR Partners, we take a different approach. We never farm out inspections to a rotating pool of contractors. Instead, we ensure that our inspectors are experienced, licensed professionals who remain with your project from start to finish. When you work with us, you get:

•  A dedicated, consistent inspector who understands your project inside and out.

•  Direct access to industry professionals who can answer your questions.

• A team that actively tracks construction progress—not just takes photos.
  

When choosing a third-party CRE inspector, it’s critical to look beyond the surface. If you’re constantly dealing with new inspectors or struggling to get answers, it’s time to reevaluate your firm.

CMR Partners provides stability, accountability, and deep industry expertise—because your investment deserves more than just a snapshot.