Monday, May 24, 2010

Caveat Emptor

If you’re on the market looking for a property for private residence or for an investment, now may be an ideal time to bid on foreclosed properties. On average, these properties are offered at 5% below market rate and because of recent economic downturns, it is much easier to find a better quality home that has unfortunately suffered a foreclosure. However, the foreclosure process isn’t always a quick one, so homes may not always be as “quality” as they seem-in other words, Caveat Emptor. Caveat Emptor simply translated means “Let the buyer beware”, a handy Latin phrase that’s been used in the real estate world for years when it comes to the sale of real property. This phrase is essentially used as warning to anyone purchasing that there may in fact be unforeseen problems with the property. And what is best when it comes to actually taking this principle into consideration during your search for foreclosed homes? Ordering an inspection. A walkthrough of a foreclosed property by you and your spouse will not be enough. Buyers need to order a thorough property inspection done by a licensed professional to get full results. Although your personal inspection may reveal minor issues such as poor air quality or other defects resulting from long vacancy, it’s the latent defects which are invisible to the naked eye that an inspector will expose. For example, a blocked pipe is a concealed defect that will most certainly reveal itself down the road. Other problems, like a broken window or worn out carpeting are types of physical deterioration that can easily be cured. The primary cause for inspections, on the other hand, is to discover hidden property defects such as electrical, plumbing or system component problems. In addition, prospective buyers order home inspections to unveil health hazards, such as the presences of asbestos, radon, mold or if the home was built before 1978, lead-based paint. There are certain signs that may indicate the presence of mold, such as swelling walls or musty odors, but it is still best to leave the inspection up to professionals. Home inspection fees fall within a wide range and vary depending on factors like property size, property value, time spent, etc. Many inspectors provide buyers with a free quote once they have received a specified amount of info on the subject property. For buyers looking to purchase foreclosed property, it is money well spent. Inspections have both a reparative and preventative purpose so it’s a win-win for buyers. Don’t let yourself fall victim and order an inspection for your own sake. Three hundred dollars spent now may save you thousands down the road.


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