Buying a Home "As Is" in Oakley Ca!
I work with a lot of people Buying a Home in Oakley and other communities and the words "As Is" scares the living day lights out of them.
What does "As Is" mean? Does it mean you cannot investigate? Does it mean you are taking a chance? Does it mean the seller will not negotiate?
Although I am not a Lawyer, as I understand it legally it means NOTHING! You cannot deny a buyer the right to do due diligence. In fact we give people so many multiple, repetitive, and laboursly boring to disclosures to read (As mandated by law and common sense) that most people do not realize how much due diligence they can do if they want.
As a practical matter what the seller is saying to a Home Buyer is"Do not ask or expect me to pay for any repairs."
Generally in this market what I tell Buyers is not to expect any repairs. Banks will not do them and certainly people selling the home in a Short Sale will not make any repairs (although sometimes you can get the bank to drop the price on a Short Sale if repairs are needed.)
Then Why do Inspections (and other due diligence)? Well you want to know what is wrong with the place. A good inspector will find lots of small issues and provide you with a guide for future maitenance and things to watch for. Don't sweat the small stuff - know this going in.
Now on occasion the Inspector will come up with a major problem. At this point you need to get the seller to fix it, cut the price, or walk away (if you cannot deal with it). This happens. Sometimes the seller/bank has no idea about the problem and will work with you when they find out how big it is. Especially when considered in light of the rest of the market and now having to sell the house with a known problem.
Another case where the banks will negotiate repairs on an "as is" sale is when the lender requires something to be repaired.
Other than these types of situations do not expect repairs on an "As Is" purchase, but you can always walk away or try to negotiate.
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Good explaination to give a buyer of what a seller means when they want the "As Is" words included in their contract. Thanks for a good post.
Gene, great post and very informative for buyers! --Krystal
Just had this discussion today with another agent. "As is" doesn't mean the buyer can't ask! Our loans are predominantly VA loans so even bank owned properties (the few that we have) may have to entertain making certain repairs they hadn't planned on if they want the home to pass a VA appraisal and ultimatley sell here.
Laural & Krystal - Thanks for the comment.
Ken - VA is where I get the repairs done sometimes. Of course they avoid accepting VA offers.
Hey Gene -
A good explanation of "As is". I don't like having to put that fact in the MLS as I know it's going to scare off many potential buyers that don't understand the term. Maybe if we continue to educate the public to the wording they'll get it and realize it's time to get off the fence and make their dream home a reality.
Best regards from The Q
Gene,
Great explanation of this!
My short sale listings are sold "AS IS".
Hope you enjoy your Columbus Day weekend!
Gene -- Short sales are generally 'as-is' as the sellers don't have the funds to make any repairs. Owners in equity sales who sell 'as-is' may not always be able to get away with it. If a safety or health hazard comes up on the inspection, I always request that they remediate or otherwise disclose. I agree that 'as-is' does scare a lot of buyers.
In your market area, it's very difficult to get the banks to do any repairs on short sales or REO's. It's refreshing to hear from other markets to find out what is typical in their areas. Fewer VA loans in California for this very reason but on the East Coast it looks like it's more acceptable to the bank.
I was gone most of the weekend. Thanks all of you for coming by. It is a misunderstood term.