How to Avoid a Real Estate Money Pit

Okay, maybe I am telling my age but do you remember the hilarious 1980s comedy, The Money Pit, starring Tom Hanks and Shelley Long?  How outrageous that movie seemed with them falling through floors and having their entire marriage end because of a real estate purchase that was not properly investigated.  But in today’s market, with foreclosures galore, Buyer’s are running (rightfully so) to snap up homes at these great prices but the Latin phrase caveat emptor still holds true now more than ever… Buyer, beware!

Here’s the scenario you should avoid as a Buyer:  You have found a great bank-owned house worth 30 - 50% more than the asking price.  You visit the home, notice it has just a few water stains on the ceiling but don’t really notice anything else that could be wrong.  You run to make an offer and it’s accepted.  Since the home was noted to be “As Is” you just prepare financially for the closing in 4 weeks.

What’s wrong with this picture?

Although the property is listed, “As Is” you should still request to have an inspection period, that will allow you to have a trained professional to view the home and report any defects that are and are not visible.  Purchasing real estate should never be a blind transaction - you must do as much as you can to prevent there being too many unknowns.  And an inspection is a simple way to unmask major and minor repairs and replacements that may need to occur to the real estate property.  You may find out that the 30 - 50% equity you were going to get needs to be spent on faulty or damaged wiring, roofing, siding, plumbing, etc.

Many Buyers decide to forgo paying the $300 - $500 for the inspection only to pay $3,000 - $50,000 or more in repairs and replacements.  Purchasing real estate should be a time where you realize a dream of ownership not the nightmare of repairs.  For more details on including an inspection period in an offer or writing an offer, call 404.444.5777 or email places2love@gmail.com.

Happy House Hunting!!