I was talking to a potential client yesterday that brought up some valid concerns about buying a short sale home. I answered her questions, but then started thinking about other buyers that may not know to ask these questions. They are important facts about short sale/foreclosured homes being sold as-is, that buyers need to be aware of so they know going in what to expect when buying a short sale or foreclosed home.
Of course the majority of the time, not "all" but majority these issues have to do with vacant short sale/foreclosed homes.
Besides the visual items that can be seen, for example; missing kitchen cabinets, missing hot water tanks, missing furnaces, missing doors and, the latest, which I could not believe, missing brick paver patio.
There are items that cannot be seen, these I believe are most costly, and therefore especially important for a buyer that is buying an short sale/foreclosed home not to overlook, because in the long run the short sale/foreclosed home might not be the "great deal" after all. [Remember the Money Pit?]
1. Winterization - If the short sale/foreclosed home has not been winterized before the temperature falls below freezing, there can be major issues. When a home has been winterized the hot water tank has been flushed and the pipes have been cleared of all water. If the home has not been winterized, what happens is that freezing water expands causing damage to the pipes and when the water thaws or is turned back on, the chance of the pipes leaking is very high. A sign to look for - look at the toilet tank/s, if the toilet tank/s is cracked, then the home was not winterized in time.
2. Mold - Big cost here. I cannot stress strongly enough to have the short sale/foreclosed home tested for mold. If mold is found in the home and depending how much mold, the cost to have the home re-mediated [mold removed] can range from $1500 - $20,000 or more.
3. Special Service Area or SSA - Areas with new homes that were originally priced lower and did not have the infrastructure cost [i.e. streets, landscaping,water lines and sewer systems ] built into the cost of the home. This is an assessment that is added to the tax bill. Depending on the home, the assessment can range from $1000 - $3000 per year and stay with the home for a period of 20 - 30 years. I see it over and over again, knowing for a fact that subdivision has the SSA but it's not disclosed on the short sale/foreclosed listing.
Lesson here is to always, always, always have a home inspection, even if the short sale/foreclosure home is being sold as-is, the buyer has the right to have an inspection done and the result will let them know whether it is a "great deal" or not.
Second, if the buyer or buyer's agent is not familiar with the area, research, research, research.
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Maria Mastrolonardo is a Realtor Associate with RE/MAX of Naperville and has been assisting home-buyers and home-sellers since 1997. Maria can be reached at (630) 248-6077 or email: mmastrolonardo@gmail.com
Servicing the towns of: Naperville, Aurora, Lisle, Plainfield, Bolingbrook, Warrenvinlle, Wheaton, Woodridge or other surrounding areas.
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