When you buy a house “as-is”, that’s exactly what you get. While this may be a good opportunity to fix up a home just the way you want it, it can also mean big problems. Dean Graziosi sites the economy as one reason for many houses being sold just as they are. If you are planning to make such a purchase, it is very important you know what you’re getting into beforehand.
When a home is listed “as-is”, the seller is released from any liability or responsibility for the property’s condition. While buying one could mean you get the home of your dreams, the situation could very quickly turn into an all-out nightmare.
Before purchasing a home “as-is”, be sure to have it inspected. It is extremely important you know what you’re getting into before you ever make an offer and later sign for your new purchase. When choosing an inspector, make sure the person has been in business for many years and his or her reputation is top-rate. Otherwise, you might wind up getting the wrong information and making a bad decision as a result.
Knowing how the home is being sold will also help you make a decision on whether or not you should purchase it “as-is”. For example, If the sale is a real estate owned property, or REO as it is often called, this means it is a property that is owned by a bank after foreclosure has occurred. In the case of a REO, you might have a good chance of negotiating repairs. This may especially work in your favor if safety is an issue.
A short sale occurs when a home owner’s mortgage balance exceeds the property value. It isn’t likely repairs will be required. This is because the owner is selling it in this case and will probably need to make the sale as soon as possible and won’t have money to facilitate any repairs.
Often times, buyers will walk away from an “as-is” property because the work involved will be too costly. According to Dean Graziosi, “This is a smart decision, if you discover that the home is in worse condition than you originally anticipated.”
Once the “as-is” home has been inspected, you’ll have a better idea of any costs associated with fixing it up. You may get lucky and won’t need to do very much, but odds are, anything listed “as-is” will need quite a bit of work. If this is the case, you’ll need to make a decision. If you do not have the money or means to do the work yourself, purchasing “as-is” would definitely not be the way to go no matter how much you really want the house. On the other hand, if you have the money to hire someone to do the work for you, or if you are able to do it yourself and can afford the materials, an “as-is” property might just be right for you. Check Dean Graziosi’s website for more information on purchasing “as-is”.