Most people interested in buying a home have come across, at one time or another, property advertised for sale “as-is.” Here are a few guidelines to help you decide whether considering such a home is right for you.
What it means
An as-is description isn’t necessarily a red flag that there’s something wrong with the house. It simply means that the sellers will not be doing any repairs. The reasons could be financial – the sellers simply can’t afford it or the transaction is a short sale. Or maybe it’s personal – the sellers already left the area or their health and/or age won’t permit them to oversee the work. Many banks and lenders selling foreclosed properties (REO properties) also will offer them on an as-is basis. And in some highly competitive markets, many homes are sold as-is because buyers are motivated enough to take the risk.
Talk with your real estate agent about disclosure laws in your state. In most areas, owners, including those involved in as-is sales, must fill out a disclosure form – a list of all known problems associated with their property. If during the inspection you come across previously undisclosed conditions that require significant, cost-prohibitive investment, you most likely can still walk away.
Inspections always are a crucial part of the process of buying a home, and in the case of an as-is home, a careful, thorough inspection is even more important. Your agent may be able to refer a reliable inspector experienced in looking at these kinds of properties. Be sure to get estimates on the various necessary repairs so you’re not blindsided by the costs after you finalize your purchase.
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