WOT: Termite Inspection, How an I going to pay for this? Options

[PatW]

Great thing about the 914world.com. You can ask just about anything and get answer.

Wife and I are looking to get out of our falling down shack (Condo) in San Jose. Seems that I have water damage in the typical places (bathroom and kitchen, I know! I should have known!). So the Termite inspector today came out and pointed out what's wrong.

So what is my next step?. I'm f'in broke and I'm no Bob Villia around the house. Do I go into Debit and get my place fixed-up before I sell or do I just let it ride and forget about it?

Thanks, Pat

[seanery]

my friend sold her house in Pasadena and went through a similar scenario. I think you should fix it, with the market the way it is in CA, I think you'll get your $ back. That's just my opinion.

[MarkV]

I don't think you should repair it now. You don't want it to look like you are trying to hide anything. The buyer can do their own inspection and the repairs can be paid through escrow at the time of closing.

[Jenny]

Chung may be able to lend you a helping hand if you're looking to repair it. He seems to be quite the Bob Villa in the bay area. (IMG:style_emoticons/default/confused24.gif) I'm not sure about repairs, but he sure can build! (IMG:style_emoticons/default/smash.gif)

Jen

[phantom914]

I don't think you should repair it now. You don't want it to look like you are trying to hide anything. The buyer can do their own inspection and the repairs can be paid through escrow at the time of closing.

Repairing it ahead of time shouldn't raise suspicion. It is done all the time. A lot of buyers won't give the house a second look if it is in need of repairs, so if possible, repair it before sale.

If you are broke, it is quite common as has been suggested to pay for the repairs through escrow from the proceeds of the sale. That is a good idea assuming you do have enough equity to cover the repairs. With the over priced/under supplied market in California, more buyers are willing to work with you on these things.

Andrew

[GaroldShaffer]

(IMG:style_emoticons/default/agree.gif) with MarkV

Just helped my mother sell her house last year. It was in need of some repairs, nothing major kitchen
floor by the sink area needed to replace but still I was not interested in trying to repair it. She listed and sold her home in three days. It was sold as is, she did offer a 1yr home warranty which cost her $135 but it was still much cheaper than fixing the kitchen floor. Just so you know to do the repair correctly I (someone) would have to remove the
sink, counter top, cabinet, cut and replace sub flooring and install new kitchen floor since the old floor was 20yr old vinyl (sp) floor. est cost of material & labor $925.

She got her asking price and the new owner knew all about the floor. My advice just leave it alone. If you are going to go into more debt to fix it to sell then you might as well fix it and live in it. If was just a matter of a quick coat of paint, then maybe but then if I was looking at your place I would be wondering why didn't you paint before you went to sell??

One more example if you don't mind. Our old house had water damage in the upstairs bathroom. I started to remove dry wall and the more I got in to it the worse it got. Ended up replacing three wall studs, 10 X 10 section of sub floor by the tub which lead to new flooring ect... you get the picture. This was not our dream house, we spent $2k on this room because it was just like a 914 while your in there might as well fix XYZ. We decided when we got done that were going to sell. I friend that is a agent said to go ahead and put it up while the bathroom was still gutted, we did, it sold in ONE day
to the 2nd couple that looked at it. I had all the material in the garage, tub, tile, sink ect.. The new owners wanted to add a few things since it was gutted, so the contract read that the tub would be installed 7 working along with the sink, but we were not to install the tile or drywall but was to leave the material in the garage. Had no problems, I think as long as you honest to yourself and the buyer and price according to condition then you should be fine.

- Garold

[PatW]

I don't think you should repair it now. You don't want it to look like you are trying to hide anything. The buyer can do their own inspection and the repairs can be paid through escrow at the time of closing.

Repairing it ahead of time shouldn't raise suspicion. It is done all the time. A lot of buyers won't give the house a second look if it is in need of repairs, so if possible, repair it before sale.

Thats a good idea, thanks... I'll work with my mortage broker on that one. Anyone have any thoughts about getting a Home Impovement loan?. Worth the hassle?

[phantom914]

I don't think it is worth getting a loan. Since you don't have the money, you could list it and gauge the interest and willingness of buyers to work with you. You might be surprised. It is still a seller's market right now. If you find you can't sell it, you can change the plan later with nothing lost.



Andrew

[Mueller]

I'm in the process of selling a house right now (supposed to close on the 9th...going on a shopping spree for my workshop and the 914 !!!!!)

anyways....we had about $650 worth of "damage" that the termite inspectors found....we had to have it fixed even thou the new buyer wanted the house "as-is" with no work done to it, period.....

even with the buyer stating this in the contract, we had to fix the damage, no if's and's or but's...........

[PatW]

Sounds like I should get an estimate from a reputable contractor and decide from there?. (IMG:style_emoticons/default/idea.gif) Add new double payne windows too and sell it for more!. (IMG:style_emoticons/default/cool.gif)

[GaroldShaffer]

Sounds like I should get an estimate from a reputable contractor and decide from there?.

Won't hurt to do that. How bad is the damage?

I have to ask, if you do repair it then why not just stay there? I don't get the fix it to sell idea. If that
was your plan all along and you will make some decent $$$ that's one thing but if you are doing it just to get out and in to something more affordable then just list it the way it is and see what happens. Why spend money if you don't have to?

- Garold

PS there is no right or wrong, just what ever makes you happy.

[PatW]

I have to ask, if you do repair it then why not just stay there? I don't get the fix it to sell idea. If that
was your plan all along and you will make some decent $$$ that's one thing but if you are doing it just to get out and in to something more affordable then just list it the way it is and see what happens. Why spend money if you don't have to?

- Garold

PS there is no right or wrong, just what ever makes you happy.

The place is busting out of the seems with all the Sh!t we have acclumiated over the 8years we've been there.. The wife has just filled up every space avaibaile..If I sell the 914 I'm sure she'll have that space filled up in no time..

Also I have to share my Garage/Carport. So there won't be any 914 maintaince anytime soon...

I have around 120-140K in equidity. I figured that I might upgrade to something bigger and keep around the same mortage monthly. (stop laughing) With a 5-to-7ARM. I don't want to stay here in the Bay Area any more than 7-10 years... Its just not like I remember it anymore.

Pat

[dakotaewing]

It all depends on what type of loan your buyer has that will determine if the lender requires the termite/water damage to be dealt with...
If your buyer is going FHA (loan amounts don't excede about 282K in CA), then the lender will require the damage to be dealt with....

Thom

[bperry]

Keep in mind that if you decide to get a equity loan for the repairs,
you CANNOT list your house for sale until this process completes.
This could delay your listing, which may or may not be important.

At a minimum, I would get an estimate for the repairs.
Since you know about the issue/damage, you will have to disclose it
to any potential buyer.
Most buyers or mortgage companies will want the damage repaired
if it is very serious, so it will come down to when and who pays for it.
By knowing what it costs, it allows you to call all the shots.
During final negoations you can make the determination
whether to lower the asking price (if necessary) and by how
much or to just do the repairs prior to the sale,
since you will know what the repair really costs.
There are many ways to play this, you can even write up the contract
such that you have no out of pocket expenses and the buyer closes
the day the repairs are done - Definitely easy for everyone.

Not sure how the market is out there in California, but here in Texas,
many times it is better if you fix the repair PRIOR to selling especially
if there is alot of cosmetic work.
This is because buyers tend to over estimate repairs and discount
offering prices or even worse, move on to the next house.
Buyers, will also bring in expensive estimates to
support their offers.
These often come late in the negotiating process, and you can get
stuck accepting his estimates.

Carpet, paint, water heaters, and roofs are things that fall into this area.
This is because you can put in the cheapest thing that functions and
looks ok and the new buyer will typically love it because it is new.
Example, if you were going to stay in the house, you might put in
a 25 or 50yr roof. But if you are selling, slam in a 15 year roof
and move on.
You can even use that it is new and still has a warranty as a selling point.

The point is that when you have the repairs done vs just
building in the repair costs into the final price, while it is more of
a pain, you get to pick the materials, and you can pick cheaper materials and cut costs, which increases the amount of $$$ you end up with in
your pocket when everthing is settled.


Also, talk to your listing agent. They should be able to help you
do all of this in the best way. - Make them earn that ridiculous %3
that they are going to charge you.

--- bill

BTW,
Not sure about California but Texas has very strict rules regarding
wood destroying insects, and you cannot sell a house that has active
insects (termites/ants).

[MarkV]

If you get a home equity loan MAKE SURE THAT THERE IS NO PRE-PAYMENT PENALTY.

[PatW]

Thanks Guys.. I have more info than I did this morning.... I'll be ready when I receive the report sometime this week..

Pat

[anthony]

Talk with your real estate agent. They should be the best resource on knowing whether this stuff will make a difference in the sales price of the house.

[agentblr]

Hey bperry, dont be slamming real estate agents,that how I support my 914 addiction (IMG:style_emoticons/default/wacko.gif)

[anthony]

The whole 6% standard commision is a load of crap. Now that an average house in the Bay Area goes for $500K it shouldn't cost $30K to sell it. The average person probably works 800-1000 hours to make $30K. Do real estate agents put in more than 40 hours to sell a single house?

6% worked fine when houses were $20K in the Bay Area and then increased in value with the rate of inflation.

[chunger]

I know some good contractors in the area that I've worked with. . . lemme know if you need numbers. There's 2 types i've noticed and I like working with reputable members of both. 1 is the licensed/bonded contractor with insurance, employees and all that stuff. I like using them for big chunks of work even though sometimes it ends up costing a bit more they've got bills to pay, benefits to dish out, and insurance to pay. The other type is the low-ball handiman type. I like hiring them for smaller bits of work. Techincally, they are only allowed to work hourly if the job is over $500.

Oh, and then there's specialty guys like HVAC, electricians, and plumbers. In those 3 sometimes you can get a guy who's not so brite and really screws something up. I can refer you to a some excellent ones and honest folks to boot.

Then at least you'll know what the actual repair cost will be and not get pushed around by the other side's estimates.

Just sold a house in San Mateo that needed minor work. Decided not to do the work and the buyer bought it as-is. If I was the buyer I would have wanted to do many things while I had the walls out so it was better off for them to buy it that way. They did negociate the price down a bit though which was fine for me at the time.

I like building new. . . everything about remodel work scares me (IMG:style_emoticons/default/headbang.gif) 'cause you never quite know what's behind the wall.

-'Chung