First of all, thank you all very much for responding so quickly and thoroughly on this. It's been a trying time for me and my family- our dream home has isn't so dreamy now. Second, I am sorry for not responding to these statements sooner. I did not receive email alerts that there had been additional replies to this thread. I have emailed this link to my phone and will now check it often.
A quick update. The other realtor shot down the idea of looking behind the drywall to asses the extent of damage. He said that he wanted me to have an "expert" contact him about it. Like I would make it up or something? He is perfectly okay with letting us pull the whole window out and inspect it that way. Both of these actions will tell us the same thing; obviously the window will cost a lot more to repair if I walk, which leads me to my next concern, who pays for the window if this happens? My realtor cannot answer this question.
Monday morning I have an "expert" on the matter coming out to look at the situation. I've told my realtor to have the other realtor come on out so he can understand things better. If they discovery serious structural issues, I plan to hire another structural engineer to asses more. I've also got ahold of an endoscopic device just in case they let us look into the walls.
I plan to get an attorney involved first thing tomorrow morning.
I'm pretty sure they have insurance. They are reputable- been in business for 25 years. Thanks so much for that link, I will review it.
And yes, the pest inspector was referred to me by the realtor. It's a shame to learn that they operate this way. Lesson learned.
I cannot find the actual piece of paper where he signed off as being free from wood destroying pests however, I did find the contract and invoice covering all the inspections. The invoice shows what I paid for the pest inspection along with all the other inspection stuff (structural/electrical). My assumption is that because it's lumped into together on that invoice, that it all covered under the same contract?
Within the contract, it says exactly what you stated-they are only liable for the cost of the inspection. The contract's letterhead and such refer to the company who performed the structural and electrical and plumbing, not the pest company who is a separate entity.
On your concession comment, they have already agreed to put 2k into basic minor repairs and then another 9k to take the furnace and vents up into the attic. A slab ducting defect was missed during the structural inspection. I found it by having an air duct company run a camera through it.
I really do not want a legal battle. I just want to get my family into a house where I can raise my family.
Far as the seller's position, this house was given to them-they do not owe anything on it. It's my understanding that they are desperate to sell it. So much so that they almost lost it here recently because of unpaid taxes.
It's funny to hear you say that ignorance is a good thing on these matters because I was thinking the same thing. I'm too thorough (almost obsessive), not to check everything twice.
The fireworks start first thing tomorrow morning. If you all have any additional thoughts, advice, anything at all, please do not hesitate to share them. Biggest purchase of my life-do not want to get a lemon.
Thanks again for all your time, thoughts, and feedback on this matter.
- - - Updated - - -
Things are looking a lot better now than before. According to this other expert, it appears that the infestation is isolated to that one area of the house. Attic was clear of any damage. Now I do think we are going to find damage in the one window area but according to my realtor, the seller will normally fix issues like that.