As Is is not always as it is!

By
Real Estate Agent with Coldwell Banker Residential Brokerage Licensed in Connecticut
http://actvra.in/mJn

New Milford, CT real estate talk. What does "As Is" really mean?

As a real estate professional in the greater New Milford, CT area, I do come across the term "as is" many times. "As is" means something different to each party, let me explain.

Selling your home "as is".

Real Estate As IsSometimes while listing a house the seller will tell me they want to sell the house "as is". I caution them that if we put "as is" in the listing it will send up a big red flag to the buyer and buyers agent.

"I wonder what they aren't going to fix?"

Perhaps you have spent time and money preparing your home for sale. You had a pre-listing inspection and took care of the issues that were pointed out to you. There is no need for you to put "as is" in the listing, if any issues do come up with a buyers inspection you are not required to fix them. The confusion on this point comes in with the buyers lender. They may ask for the inspection report and red flag certain items themselves, refusing to lend money until these issues are addressed.

But again, it is your right to say no, I will not fix anymore. I have done enough! Just know it might cost the deal, you should always discuss it with your real estate agent and if you are already in contract, discuss it with your attorney as well.

Buying a home "as is".

Buyers do not like to see "as is". I expect certain types of listings will be sold "as is". For instance, a short sale. Often times the home owner does not have the financial ability to address an issue that crops up. If the issue is a real deal breaker, it is not unheard of for the lender to assist correcting the issue in order to keep the sale on track, but don't hold your breath.

Foreclosures are often sold "as is". However I am seeing more and more lenders who understand that if they want to get the property sold they may have to address certain issues. If a buyer discovers that the septic system is shot, they may fix it if they know it will stop any other buyers from purchasing the property. However this is not a given. Homes that are in probate are often sold "as is" also. There just may not be enough money in the estate to pay for any repairs.

All in all, when purchasing a home that is "as is", make sure you get a very thorough home inspection. And make sure you understand that your lender may not be on board with the findings, especially for a first time home buyer.

"As Is" in real estate is not always the case! My advice? Keep it off the listing if you are a seller.If you know there are issues that are going to pop up and you can't address them, price it accordingly. If you are a buyer, just make sure you know what you are walking into. "As is" is really nothing more than a big red flag!

AS IS IS NOT ALWAYS AS IT IS!

Originally posted at "Real Estate As Is"

Posted by

Andrea Swiedler, Realtor, Southern Litchfield County Real Estate

2017 President, Greater New Milford Board of Realtors

2017 Connecticut Magazine 5 Star Realtor

 

 Search homes for sale in Litchfield County, CT.

 

Coldwell Banker Residential Brokerage

Litchfield County Regional Office,375 Danbury Rd, New Milford, CT 06776

 

© Andrea Swiedler 2009 - 2017

 Always do right. This will gratify some people and astonish the rest. - Mark Twain

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Randal Jenkins 11/09/2011 02:45 AM
  2. Gene Riemenschneider 11/09/2011 10:43 AM
Topic:
Home Selling
Location:
Connecticut Litchfield County New Milford
Groups:
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Tags:
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Rainer
322,535
Kate Akerly
Halstead Property - Brooklyn, NY
Brooklyn Residential Sales and New Development

Depending on the  laws in your state "As Is" clauses in the contract of sale can also affect the seller's disclosure obligations (or lack thereof) as well as warranties that may survive the closing.

Nov 09, 2011 05:00 AM #26
Anonymous
John T. Roulis- Platinum Properties RE, Jupiter Fl.

As is with the right to inspect has become the norm with most folks in PB County Florida. It is negotiating the offer twice. Our documentation reads "at the buyers sole discrection they can walk away" provided they timely tell seller in writing. Nothing has to be wrong with the home. It basically gives them a recission period. I personally find this even on homes that aren't short sales or bank owned. Just had a wonderful listing, every offer I received was as is. That was not stated in the offering. I believe the Real Estate population got into a lot of heated discussions on what should be fixed & a bunch of cosmetic suff that didn't pertain to purchase & sale agreement. The Real Estate population has done a very poor job comprehending the contactual agreements & this has led to the as is.   Here it also states in the rules, that the seller & agent would then have to disclose ALL Known Facts that materially affect value that are not readily observable to all subsequent the buyers. " Years ago, when we saw an as is, you never  showed, you stayed far away from unless an inestor should some interest. I personally do not like nor condone. 

Nov 09, 2011 05:05 AM #27
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Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional

Andrea>>>

When I see a house advertised as-is, I tell my buyers to assume that even the best inspector might miss  a few things here or there. No disclosure will almost inevitably lead to lower offers.

Nov 09, 2011 05:20 AM #28
Rainmaker
1,427,988
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

"As is" is an over used term.  People can still inspect and still negotiate.  Basically you are saying I won't do anything to fix this house to get it sold.

Nov 09, 2011 07:41 AM #29
Rainer
420,125
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

Most "as is" properties are distressed and a full time agent should already know about the area and neighborhood and shouldn't be surprised nor should their clients. That said, it depends on the condition of the property to determine what is and as is to determine what if any offer should be presented, don't you think?

 

Nov 09, 2011 07:57 AM #30
Rainer
18,511
Debra Miller
Bella Real Estate - El Dorado Hills, CA

In California all of our contracts are "AS-IS" subject to inspection. Even if it says "AS-IS" it doesn't always mean "AS-IS" sometimes with REO's there are safety issues, or other issues that are called by an appraiser that become a condition of the loan and they HAVE to be fixed.The bank is going to have to fix it for another buyer anyway. Sometimes sellers put that in the remarks because they are setting a tone that they are not going to be nickle-and-dimed to death or they simply don't have the money to put into repairs. When a property says "AS-IS", it doesn't mean that a buyer still doesn't have the right to ask. You can always ask and see where it goes, it's called the Art of Negotiation!

Nov 09, 2011 11:08 AM #31
Rainer
233,213
Karen Bernetti
Southington, CT

This is wonderful advice Barbara!  It is a concept that is so misunderstood.  It's great how you bring up the banks take on it too.  Well done.  

Nov 09, 2011 01:52 PM #32
Rainmaker
1,673,232
Winston Heverly
Winston Realty, Inc. - Atlantis, FL
GRI, ABR, SFR, CDPE, CIAS, PA

Here in S. Florida, everyting is as-is. The term of not having the financial ability takes on a whole different meaning.

Nov 09, 2011 03:52 PM #33
Rainmaker
774,827
Bob Miller
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team

Hi Andrea,  I agree.  I usually tell my sellers we will turn it into an as-is based on offer-counteroffer.  A lowball price is as-is.

Nov 10, 2011 11:17 AM #34
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Andrea Swiedler
Coldwell Banker Residential Brokerage - New Milford, CT
Realtor, Southern Litchfield County CT

Thank you everyone! The past few days have been busy with appointments, a closing, issues, etc. I just showed another one yesterday.. "as is", with a possible buried oil tank on the property. After my current fiasco with an oil tank.... this is a sure sign of headaches to come as my buyer liked it.

Thanks again!

Nov 11, 2011 09:03 AM #35
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Wow, how strange. AS IS is very common here. It does not mean that there is anything wrong with the property, actually last year out of my 48 sales ... 48 were AS IS. All our listings are AS IS. And I am very surprised with all these negative connotations.

It is AS IS with the right of inspection. You do the inspection and you may decide to walk away, or reneotiate. the only thing you can't do is force the Seller to do the repairs.

So what?

And often the sellers and buyers find commong ground here as well.

Can it simply be an agent's phobia?

Nov 11, 2011 03:01 PM #36
Rainmaker
679,710
James Quarello
JRV Home Inspection Services, LLC - Wallingford, CT
Connecticut Home Inspector

Inspected an as is property recently, it was a short sale. The buyers agent, whom I do not know, pulled me aside to run over what I would call her rules for the inspection. She made it very clear the property was as is and no repairs would be made. I pulled my buyers aside and told them that not every agent approaches the sale in this manner. Further if I were to discover safety issues, its fair to expect they should be brought to the sellers attention (the bank) and quite possibly addressed.

I found several fairly serious electrical issues and improperly "mitigated" asbestos. 

Nov 12, 2011 01:35 AM #37
Rainer
84,295
janine nielsen
Re/Max Advantage - Redlands, CA
Homes For Heroes Realtor

Everything is negotiable. In So. Cal. the REO's and Short Sales are typically sold "As-Is", and the lender's have been stubborn about repairs. I have found if anything is called out to be repaired in the appraisal and you present it with bids to repair(do the leg work for them), you can typically convince them it is in their best interest(fiscal) to do the work.

Nov 12, 2011 04:06 AM #38
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Patricia Kennedy
RLAH Real Estate - Washington, DC
Home in the Capital

Hey, Andrea!  I included this post in Last Week's Favorites.  Have a great Sunday!

Nov 13, 2011 03:52 AM #39
Rainer
36,991
Jayson Holland
Listings.com - Denver, CO
Jay Holland

Agreed. As-is isnt always as-is. Write the offer, negotiate, come to terms. Sometimes as-is is, sometimes as-is isnt.

 

Nov 13, 2011 03:58 AM #40
Rainmaker
587,915
Susan Neal
RE/MAX Gold, Fair Oaks - Fair Oaks, CA
Fair Oaks CA & Sacramento Area Real Estate Broker

Hi Andrea - Since our Califonria contract forms already say that the purchase is AS-IS, I advise my clients to worry about any repairs or whatever in the negotiations that may take place after the inspections are completed.  If I represent the buyers who want a home but are uncomfortable about the purchase after reviewing the inspection report, they can then ask for repairs to be made by seller, and if they are rebuffed, they can cancel the deal.  Usually the seller will agree to at least negotiate the most serious issues at that time.

Nov 13, 2011 10:51 AM #41
Rainmaker
377,348
Marie Story
Coldwell Banker - Pinecrest (Miami) - Pinecrest, FL
Broker Associate, Pinecrest (Miami) Specialist

Andrea, very interesting points to consider, thanks.

Nov 13, 2011 11:32 AM #42
Rainmaker
374,541
Lloyd Binen
Certified Realty Services - Saratoga, CA
Silicon Valley Realtor since 1976; 408-373-4411

Patricia's list sent me here.  For a long time the California Association of Realtors discouraged using the term "as is" because they felt it was interpreted differently by different people.  About 7-8 years ago they changed the standard purchase agreement to default to "as is" and that has make "as is" sales more common and acceptable.

 

Nov 13, 2011 05:01 PM #43
Rainer
284,068
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

Andrea -- I also found this via Particia's list.  As lender - we recently had REO - with problems: roof leaked, gutter problems, paint basically gone on outsite, plus water marks on sheetrock inside, and couple holes in walls.  Though it was listed "as-is" the bank paid to get those things fixed.

Nov 14, 2011 07:00 AM #44
Rainmaker
484,161
Sylvie Stuart
Realty One Group Mountain Desert 928-600-2765 - Flagstaff, AZ
Home Buying, Home Selling and Investment - Flagsta
I have had sellers want to sell their homes as-is and I gave them the exact same reasoning on why they shouldn't advertise the listing that way. It's definitely a red flag for buyers. Unless it's a short sale, bank owned or probate, because an educated buyer expects it then. ALWAYS get a home inspection no matter what, though!
Jan 25, 2012 12:54 AM #45
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