As we continue in this cycle of short sales, foreclosures, and other distressed property transactions "As Is" sales are becoming more and more common. Banks and other lending institution who acquire a home through foreclosure usually have no idea what the property looks like and whether there are any material defects that should be disclosed.
When this occurs, the institution usually offers the property for sale in "As Is" condition. This means that the seller makes no warranty to the buyer either expressed or implied as to the condition of the premises, the zoning of the premises, or the premises fitness for any particular use or purpose. However "As Is" does not relieve the seller of the legal obligation to disclose all known material latent defects to a buyer.
An individual considering the purchase of a property in "As Is" condition should proceed carefully. Upon negotiating a contract, the buyer should conduct an independent inspection and investigation regarding the premises. Upon completion of the inspections and any other investigations, the buyer can ask the seller to repair those items that may be health or safety issues. However most institutions who are conducting a distresses property sale will be reluctant to make repairs as they are likely losing money on the transaction.
In Arizona, members of the Arizona Association of Realtors use an "As Is Addendum" which is included with a listing contract. The real estate agent representing the seller will have included it in the listing agreement and a buyer must sign that they acknowledge the risks associated with buying such a property. I have posted a sample of the addendum here.
My best advice is to enlist the services of a competent realtor if you decide to purchase a distressed property in "As Is" condition. You will be glad you did.
Comments(0)