• Home
• Buy
• Sell
• Statistics
• Neighborhoods
• Loans
• Search Tucson MLS
• About Tucson
• Blog

What’s the Risk of Buying As-Is?

July 23, 2007 | By Kelley Koehler | Filed Under Home Buying 

I’m working with a nice couple trying to buy their first home in Tucson, and we’re in negotiations currently for a property.  They’re faced with a counter offer from the Seller, with an “As-Is” clause.

First, “As-Is” doesn’t negate a Buyer’s right to thoroughly inspect the property, at least as far as Tucson real estate is concerned.  The language a local Tucson agent would use to make a home purchase “As-Is” clearly states that the Buyer has not only the right, but the obligation to do inspections on their own.  Also, if a Buyer were to find a problem with the house that would make them not want to buy it, then the Buyer can give proper notice and walk away from it with their earnest money.

(…unless you’ve got some kind of crazy language written in – if you’re in an “as-is” transaction, go ask your agent for specific advice regarding your contract.)

Also, the Seller is still obligated to disclose every material fact that they know about the property.  The Seller doesn’t get to hide any known information.

So what’s the risk?

Well, a typical concern for an “as-is” home buyer is that there are major problems with the house.  This may, or may not be true.  Remember, the Seller is obligated to tell you about the issues and defects that he knows about, so he shouldn’t be hiding anything.

There are myriad reasons why a home might be sold “as-is:”

• the house might be owned by a lender or relocation company
• the house might be in foreclosure
• the Seller may not live in the area, so it would be difficult to coordinate repairs
• the Buyer may take a house “as-is” to get a discounted price for the house
• the sale might be an estate sale, where the Seller hasn’t occupied the property and doesn’t want to warrant the house systems
• the Seller may not have enough funds from the sale to pay for any repairs
• and yeah, at times as-is sales involve run-down homes in bad repair.

If you’re considering buying a house “as-is”, just know that you need to go into the transaction with open eyes, you need to thoroughly inspect the house so that you are comfortable with the condition and are making confident decisions.

Comments

Search this Site

Other Information That Might Be Helpful

• Buying Short Sales and Foreclosed Homes in Tucson (April 1, 2009)

  Been discussing this quite a bit recently with my home buyers.  Two very different situations if you’re trying to buy short sales and foreclosed houses in Tucson.
  A foreclosed home – also called bank owned or an REO property – is one where the lender has completed the foreclosure process and now has taken it back [...]

• When You Can’t Just Throw Money At The Problem (July 21, 2008)

  Last week, we talked about buying a home with little or no money down.  Here’s another aspect we didn’t cover in that discussion, from a Seller’s perspective.
  Here’s the common scenario: let’s say you just accepted an offer and agreed to pay 3% in down payment and an additional 3% in closing costs to the Buyer.  [...]

• Proposed Rule Change for Short Sales in the Tucson MLS (December 20, 2008)

  Landed in my inbox today, a proposed rule change, if I understand the message correctly:
  MLS Rule Change for Short Sales
  Section 3.18- Short Sales:
  As used in these rules, short sales are defined as a transaction where title transfers; where the sale price is insufficient to pay the total of all liens and costs of sale; [...]

Copyright © 2010 Tucson Homes, Neighborhoods, and Real Estate from Housechick.com