What is, "as is"

By
Home Inspector with Final Analysis Home Inspections

You Know what "as is" means, But what does it mean in regards to the property your buying. Some people think that because it's "as is" there's no point in getting a home inspection. Not true. As is does not mean you don't have the right to be informed. A Home inspections plays a key role in determining exactly how "as is" can impact your purchase. We're seeing more and more bank foreclosures, short sales, etc. and typically these are sold strictly "as is". Meaning the title holder of the property plans to do nothing in repairs or upgrades. It's what I call the Sergeant Schultz Syndrome. Remember the chubby gestapo guard on Hogan's Hero's who coined the phrase " I - Know - Nothing! "? It was his way of claiming ignorance and shun responsibility. A bank would prefer to remain ignorant of property conditions because they just don't care and don't want to know. They just want to dump the property from their inventory without a whole lot of complications. 

So how can a home inspection help? Well you at least need to know what "as is" is. A home inspection put into true perspective what your true cost may be in a property. maybe it needs a roof or furnace. That's fine as long as those cost don't increase the price over market value. Then maybe it's not such a good deal and you can elect to pass on the purchase. Conversely the bank may concede to a price reduction so you can cover these cost. Moreover, I've seen times when a bank will relent and decide to fix certain items because they realize a buyer in hand is better than two in the bush and they now realize form the inspection discoveries that there are things about the property that need to be fixed if they are going to sell it to anyone at all.

A good inspection will also lead you to obtain more specific expertise on suspected problems and associated repairs.  Fore example, may you just learned that you have old iron pipes buried in the concrete slab and the bathroom drains are backing up.  A good home inspector will disclose this and recommend further invasive inspection by a plumber who will run a camera through those pipes and find that they are collapsed from internal corrosion and it will cost $8,000 to repair. You can either walk away or you can present these findings to the bank and negotiate repair cost.

Final word. It's very important that you hire a competent, thorough inspector who will generate a detailed comprehensive report. A professionally prepared report will give you the leverage you need in showing the bank that there are legitimate, bon-fode issues that need to be addressed. The bottom line...If they stick to their guns about selling "as is", then you can walk away at least knowing that "as is" turned out not to be a sound purchase.

Remember BUYER BEWARE

Comments (15)

Dinah Lee Griffey
Windermere Peninsula Properties - Allyn, WA
Managing Broker Windermere Peninsula Properties

Great point. I always let my clients know how important an inspection is, even for HUD homes. It is what you know that counts, and helps you decide what to offer. I love pre inspections!

Sep 27, 2008 03:37 PM
Tina M. Haugen
Simply Vegas #1 for a Reason - Henderson, NV
REALTOR, CFAC, SFR, RRG

this such a wide view, as is to what they ask.

Sep 27, 2008 03:37 PM
David Saks
(retired) - Memphis, TN

A few bucks well invested in an inspection can prevent a bad headache and a dramatic depletion of resources in the days ahead.  Fine post, Dan

Sep 27, 2008 03:39 PM
Susan Neal
RE/MAX Gold, Fair Oaks - Fair Oaks, CA
Fair Oaks CA & Sacramento Area Real Estate Broker

Seems to me that a home inspection would be even more important for an "as is" purchase.  I'd rather see my clients back out and lose a little bit of money than go in blindly and find they have purchased a disatrous money pit.

Sep 27, 2008 03:42 PM
Sherry Peckhoon Sim
Sims & Company - Cayucos, CA
Broker/Owner, Covering the Beautiful Central Coast

I agree with the above comments. I have always recommended a professional home inspection, especially on an 'as is' property. 

Sep 27, 2008 03:45 PM
Shane OnullGorman
Eau Claire Realty, Inc. - Eau Claire, WI
Eau Claire Wisconsin, Real Estate Agent & Realtor- Buy or Sell

in my state wisconsin there is no such thing as "sold as is" A condition report must be filled out if the seller has lived there.

Sep 27, 2008 03:52 PM
Sergio Rebollo Jr.
Real Estate TeamMates - Miami, FL

You can never go wrong with a home inspection.  The last buyer did one and the seller had to spend $4000 in repairs pointed out by the inspector.

Sep 27, 2008 04:00 PM
Mike Butson
The Davis Company - Austin, TX
Realtor & Sales Trainer

Good points. It is always best to know what "as is" is..isn't it? 

Sep 27, 2008 04:04 PM
Kevin Pierce
Cascade Builder Services - Tacoma, WA
New Construction Warranty Management

Daniel, great post and very nice website.

Sep 27, 2008 04:06 PM
Deidre Berry
WOW Real Estate - Florence, AL
Realtor - Florence, Alabama

Alabama is actually a "buyer beware" state...no seller's disclosure required except for known health/safety issues or latent structural defects.  Home inspections are at the top of my to do list for buyers, especially on "as is" properties...even though I still have buyers that insist on saving a few bucks and don't get an inspection!  

When I first started in real estate, I had a more "experienced" agent try to tell me that the buyer I was representing didn't need a home inspection because the property he had listed was "as is" and no repairs were going to be made.  I told him I understood that, but the buyers needed to know what they were getting in to.  Long story, but the buyers eventually pulled their offer because it got to be such an ordeal with this agent during the negotiating process.  Hmmm....makes you wonder what was wrong with that house! 

Sep 27, 2008 04:13 PM
Sharon Alters
Coldwell Banker Vanguard Realty - 904-673-2308 - Fleming Island, FL
Realtor - Homes for Sale Fleming Island FL

We always recommend inspections - even with new homes - but our contracts that are "as is with right to inspect" have a sole discretion clause giving the buyer an out with deposit returned if they see anything that makes them uncomfortable, regardless of the cost to fix it.

Sep 27, 2008 04:21 PM
Susan Peters
Dove Realty Inc. - Seattle, WA
The Better it Looks the Better it Sells

Hi Daniel,

Whenever  I see "as is" I think it might be a good idea to get two inspections.

                                  No inspection? No way!            

Sep 27, 2008 04:48 PM
Anonymous
Anonymous

Daniel,

Good post. Home buyers should view the inspection as a bit of an insurance policy especially with an "as is" purchase. I am sure that you have done inspections for clients who "know it all" and then are quite surprised what you found and what they didn't see. A good inspector is worth there weight in gold.

Sep 28, 2008 01:29 AM
#13
Louis Agudo
Home Sweet Home Inspection Services - Roswell, GA
Roswell Home Inspector

Daniel,

I posted the previous post on your blog

09/28/2008 08:29 AM
  and my info did not come up. Very odd indeed. Good info.

Sep 28, 2008 06:41 AM
Hank Spinnler
Harmony Home Inspection Services of GA - Hoschton, GA
Atlanta Home Inspector

As the response from an anonymous individual wrote "I am sure that you have done inspectons for clients who "know it all" and then are quite surprised what you found and what they didn't see." 

I get a kick when the opportunity arises to demonstrate, educate, and possibly even amaze a client with the inspection process and discovery of the actual condition of the inspected property.

Don't let Uncle Charlie do it unless he has been properly trained and schooled in the art of home inspections, and performs inspectiosn regularly!

Oct 08, 2008 01:12 AM