While some may think that purchasing a home “as-is” is reserved for investors, it can be a way for any homebuyer to save on one of the largest investments they’ll make. However, it’s important to understand why sellers are offering the property “as-is” to avoid financial surprises on your home purchasing journey.
What it means to purchase a home “as-is”
When a home is listed for sale “as-is,” the sellers do not want to do any repairs before closing. As-is homes do not always have everything in working condition, and it’s the purchaser’s responsibility to take care of any repairs needed. Even with as-is homes on the market, sellers are still required to meet the minimum federal and state disclosure standards, such as disclosing lead-based paint.
Common reasons a home may be sold “as-is” include:
- Sellers cannot afford to make repairs
- Sellers do not have the time to complete a major job or the funds to pay the contractor to finish the job
- The property is being sold to settle an estate
- The home is outdated and the seller does not want to make cosmetic changes before selling
Since buying a home “as-is” means accepting all visual defects, it’s important to keep these seven red flags top of mind.
1) Inspect the foundation
Foundation problems can be costly to repair, so you want to ensure you can budget for any current or near-future issues. A home inspector will identify any foundation cracks. However, if you suspect major problems, it may be best to hire a structural engineer to assess the home.
2) Check for additions
For homes with additions or detached structures added to the property, be sure to not only check the build quality but you should also ensure that the additions meet all government or HOA guidelines.
3) Inspect the roof
As the system that protects a home’s interior from elements, roof damage can lead to major issues that are expensive to fix. A licensed home inspector will check the roof for any damage or issues. If there are any concerns, you can hire a roofing company to provide an estimate to replace the roof or complete any necessary repairs.
4) Check the flood zone map
Whether the property has flooded in the past or is located in a flood zone, it’s a good idea to know the flood status before making any home purchase. If flood insurance is required, it can be an additional monthly expense that you should consider before moving forward with the transaction.
5) Look for mold
Besides making walls and surfaces visually unappealing, mold can be hazardous to you and your family’s health. Check the home for any current or past leaks, as it can create a prime environment for mold to grow. If mold is present anywhere in the home, hire a mold inspection specialist to assess the type of mold and safely remove it.
6) Get a septic or sewer inspection
Having a septic or sewer inspection before closing on a home can save you thousands later down the road. A cracked or crushed sewer pipe can cause surprise backups requiring immediate attention and repair. Getting a wastewater system inspection before purchasing can give you peace of mind or ensure you can afford any necessary repairs before a complete system failure.
7) Not allowed to have an inspection
When buying as-is, purchasers are still allowed an inspection period. If the sellers are not open for buyers to have a property inspection, it is a major red flag for any home purchase. A deep discount can make “as-is” home purchases without an inspection attractive, but it’s still important to weigh the potential added expenses for items you missed in your initial walk-thru of the property.
Tips for buying a home “as-is”
If you find a home sold “as-is” that fits your budget and search criteria, follow these three tips to help ensure the purchase goes smoothly.
- Work with a real estate agent
- Don’t skip the home inspection
- Have cash or financing ready
When buying a home, having a professional real estate agent on your side can help make the transaction less stressful. Your REALTOR will guide you through the buying process and advise you on what to expect with “as-is” properties. If you have home buying questions or are ready to view a home for sale in Bristol, Abingdon, Marion, or surrounding Southwest Virginia and Northeast Tennessee region, contact one of our agents today.