Put in an offer for a house....

[KSpan]

16 minutes ago, hepcat said:

Update: Owner sent us a message that he's still considering our counter offer. Says he might offer a fixed amount to help cover closing costs. Also hasn't given us an actual yes or no so he could still reject it. We're backing out should he say no. I have three vendors on call waiting to do an inspection should this go through - Regular home inspector, mold tester, and a foundation company coming out to do a level test and possible estimate of any needed repairs.

Reading through this thread, I echo everyone who is telling you to bail. Foundation/water/termite damage is bad enough, let alone all 3, and you can and likely will be in a world of financial hurt/if when they open things up for repairs and find things worse than anyone 'suspected'.  Not trying to be a Debbie Downer but as someone who's had to spend over $50K out-of-pocket for house repair nightmares I'm imploring you not to go into this situation voluntarily.

[Anybodyhome]

On 1/29/2019 at 9:43 AM, hepcat said:

"...some issues we'll have to deal with the whole time we live there."

Even if there was no foundation issue, no flooding issue and no termite issue, there is no reason to believe any house you buy should have "issues we'll have to deal with the whole time we live there."

That's not normal and not acceptable unless you make a conscious decision to purchase a house with chronic issues. That's like buying a car after the seller tells you it never starts when it's below 40 degrees. It's not normal. 

[hepcat]

Posting the sellers disclosure for everyone's reference. Aside from seeing the house twice in person before making our offer this is what I'm working with

Seller's disclosure edit.pdf

[Squirrel]

Ac is going to be need replaced shortly. All the other issues is one corner of the house at the master bedroom. Does seem like they have done corrective work but you wont know til inspection. 

 

I hate when owners try to drag out a offer hoping for a better one.  After a week I usually move on. 

 

 

 

 

 

[hepcat]

Update: they countered with a flat amount to help with closing costs. We accepted and are going into the option period for inspections. Wish us luck!!

[thefuzz]

43 minutes ago, hepcat said:

Update: they countered with a flat amount to help with closing costs. We accepted and are going into the option period for inspections. Wish us luck!!

Good luck...and please please please remember to do, or depending on how you look at it don't do anything with your credit until you have closed and recorded.

I have seen dozens of real estate transactions go south because someone went to Ashley Furniture and got a store card to furnish the house....or closed an old credit card, bought a car during due diligence period...etc.

Cannot stress this enough, do not touch your credit during this time, and do not use your credit cards at all if possible.  Also, if you have any strange transactions or deposits to your accounts, you need to start sourcing those now.

 

[Inimicus]

The first house my wife and I bought was one purchased on emotion.  We offered, they accepted and we were on cloud 9.

Inspector found some standing water under the house, a single floor joist showing some rot, and a windowsill with some rot.  Everyone told us to walk away.  Parents, friends, co-workers, everyone but the RE agent.  We had the seller fix the joist and a 5k allowance for the window and to have a drain installed in the crawlspace.

We should have listened.

Before we sold it we had to have the entire back of the house rebuilt.  The floor joist that we had fixed was the tip of the iceberg.  The rot there was not the beginning of the problem but just the furthest the rot had progressed.  What we discovered years later that the origin of the rot was actually the flashing around the chimney.  The only thing holding up the chimney box was the metal flu inside of it and the external siding.  the windows that flanked the chimney were only being held up by the top plate and the studs nailed in from the top.  The lower parts of them had rotted almost completely away and the bottom plate was almost non existent.  Total cost of the fix was north of 20K.

My point...

Be damned sure of what you're getting into.  Lots of warning signs here and inspectors can only see so much.  They cant open walls to see the true extent of the damage and contractors will low ball you at this point so that you buy the home and then they can hit you with a "well its worse than we thought and so its gonna cost more".

I know its exciting to have a house under contract but this is not something to be emotional about.  Be smart.  You're putting yourself on the hook for a lot of money.

[hepcat]

3 hours ago, Inimicus said:

The first house my wife and I bought was one purchased on emotion.  We offered, they accepted and we were on cloud 9.

Inspector found some standing water under the house, a single floor joist showing some rot, and a windowsill with some rot.  Everyone told us to walk away.  Parents, friends, co-workers, everyone but the RE agent.  We had the seller fix the joist and a 5k allowance for the window and to have a drain installed in the crawlspace.

We should have listened.

Before we sold it we had to have the entire back of the house rebuilt.  The floor joist that we had fixed was the tip of the iceberg.  The rot there was not the beginning of the problem but just the furthest the rot had progressed.  What we discovered years later that the origin of the rot was actually the flashing around the chimney.  The only thing holding up the chimney box was the metal flu inside of it and the external siding.  the windows that flanked the chimney were only being held up by the top plate and the studs nailed in from the top.  The lower parts of them had rotted almost completely away and the bottom plate was almost non existent.  Total cost of the fix was north of 20K.

My point...

Be damned sure of what you're getting into.  Lots of warning signs here and inspectors can only see so much.  They cant open walls to see the true extent of the damage and contractors will low ball you at this point so that you buy the home and then they can hit you with a "well its worse than we thought and so its gonna cost more".

I know its exciting to have a house under contract but this is not something to be emotional about.  Be smart.  You're putting yourself on the hook for a lot of money.

We have the inspections tomorrow. I'm not hell bent on buying this place, if we back out now we're only out the cost of the inspection and a $150 contact fee. Definitely going to make an informed decision and not end up with a money pit

[hepcat]

Inspections are complete. Started off positive with the home inspector saying that for a house built in 1964, the house is in pretty good condition. There are minor issues with some roof shingles and some flashing around the chimney, some leaks in the duct work in the attic, but structurally the house is in good condition. Copper wiring and an updated electrical system.

Now for the bad. The foundation was assessed by a professional, and its looking about a 2.5 inch drop from the highest point in the NE corner to the lowest point in the SW corner. Now if no foundation work had been done to the house since 1964, this would be excellent. But it’s clear that some work had been done and more will likely have to be done. We were given a $10k quote to repair this, but I was planning on getting a second opinion. Honestly the house is structurally in good condition per the home inspector and I agree, so I don’t see the foundation as an absolutely urgent issue.

Now for the terrible. I had a plumbing company come out and send a camera down the drains in the house. The sellers disclosure said the main drain line had been replaced with PVC. That is true, from about 2 feet out from the foundation to the city line. Underneath the house....the cast iron pipes are completely rotted away into the dirt. Quite literally, sewage is seeping into the dirt under the house. Undoubtedly this issue is in conjunction with the foundation issues. The quote to fix the plumbing was $28k, which seemed wildly excessive. But it’s still a significant problem.

Needless to say the plumbing issue has given us some pause. We’ve gone to the list agent and owner of the house to see if they’d be willing to get the cast iron pipes replaced, or knock off the cost of repairs to the asking price. In all likelihood we’re moving on unless the price comes down. I’d say it’s likely we’re walking away and I’m only out of pocket about $1000 in inspection fees and document fees. But we did our due diligence, and we can get through our wedding without worrying about this. 

I’ll give another update should the owner be willing to work with us for a repair or if something drastic happens. As it stands with our current offer we are backing out.

[OHYO]

41 minutes ago, hepcat said:

Inspections are complete. Started off positive with the home inspector saying that for a house built in 1964, the house is in pretty good condition. There are minor issues with some roof shingles and some flashing around the chimney, some leaks in the duct work in the attic, but structurally the house is in good condition. Copper wiring and an updated electrical system.

Now for the bad. The foundation was assessed by a professional, and its looking about a 2.5 inch drop from the highest point in the NE corner to the lowest point in the SW corner. Now if no foundation work had been done to the house since 1964, this would be excellent. But it’s clear that some work had been done and more will likely have to be done. We were given a $10k quote to repair this, but I was planning on getting a second opinion. Honestly the house is structurally in good condition per the home inspector and I agree, so I don’t see the foundation as an absolutely urgent issue.

Now for the terrible. I had a plumbing company come out and send a camera down the drains in the house. The sellers disclosure said the main drain line had been replaced with PVC. That is true, from about 2 feet out from the foundation to the city line. Underneath the house....the cast iron pipes are completely rotted away into the dirt. Quite literally, sewage is seeping into the dirt under the house. Undoubtedly this issue is in conjunction with the foundation issues. The quote to fix the plumbing was $28k, which seemed wildly excessive. But it’s still a significant problem.

Needless to say the plumbing issue has given us some pause. We’ve gone to the list agent and owner of the house to see if they’d be willing to get the cast iron pipes replaced, or knock off the cost of repairs to the asking price. In all likelihood we’re moving on unless the price comes down. I’d say it’s likely we’re walking away and I’m only out of pocket about $1000 in inspection fees and document fees. But we did our due diligence, and we can get through our wedding without worrying about this. 

I’ll give another update should the owner be willing to work with us for a repair or if something drastic happens. As it stands with our current offer we are backing out.

28k WOW!  How many feet of the main sewer pipe runs through the slab? If it runs the length of the house it would be costly to jack hammer the path in the slab it runs and then patch  concrete and replace or repair flooring.

[hepcat]

39 minutes ago, OHYO said:

28k WOW!  How many feet of the main sewer pipe runs through the slab? If it runs the length of the house it would be costly to jack hammer the path in the slab it runs and then patch  concrete and replace or repair flooring.

I think I overheard about 18ft. That included the kitchen drain as well. 

[thefuzz]

14 hours ago, hepcat said:

I think I overheard about 18ft. That included the kitchen drain as well. 

That's a high quote, but I would not be interested in this home were I you.

Keep looking.  And more importantly....keep saving.

[hepcat]

17 minutes ago, thefuzz said:

That's a high quote, but I would not be interested in this home were I you.

Keep looking.  And more importantly....keep saving.

I've looked into a few alternatives to fix this drain issue and discovered a "trenchless" drain fix where they essentially send a balloon/drill down the pipe and behind it pull a new pipe made out of an epoxy/resin composite that forms to the mold of the old pipe. These pipes might be too far gone for this option but we might run into this for another house so it's good to know the solutions.

Unless the owner comes back and says he'll get this problem fixed or knock a significant amount off the price to get it fixed, we've decided to move on.

[thefuzz]

51 minutes ago, hepcat said:

I've looked into a few alternatives to fix this drain issue and discovered a "trenchless" drain fix where they essentially send a balloon/drill down the pipe and behind it pull a new pipe made out of an epoxy/resin composite that forms to the mold of the old pipe. These pipes might be too far gone for this option but we might run into this for another house so it's good to know the solutions.

Unless the owner comes back and says he'll get this problem fixed or knock a significant amount off the price to get it fixed, we've decided to move on.

Likely the correct call.  I will say this though, even if they knock off that amount to get it fixed, you will need to have that full amount in cash to fix it correctly.  Back in the day you could get a 2nd mortgage to do stuff like that....much much harder for that type thing these days.