utilities not turned on

8 Replies

Hi again - I think my last posting may have been a bit long so I'll make this super short:

Has anyone ever encountered an REO property that had been abandoned and utilities not turned on? We live in a fairly cold climate (except in the past few years) so the house had been winterized. We just wanted to have the utilties turned on and house dewinterized for inspection but the real estate agency selling it says no.

Is this odd or typical?

This is typical, unless you offer to pay upfront for dewinterizing and rewinterizing it's not going to happen. The lender sees it as an expense on the property and a liability in cold climates.

Jim hit the nail on this one. The bank or lender is already eating sh** by holding the property. They don't want to incur any additional expenses if they don't have to.

Hi - thanks for your answers. We did say that we would pay for all of it - the dewinterization, having the utilities turned on and rewinterizing if we had to.

So do you think they are saying no because if something is found to be wrong, tehy would have to disclose it to the next potential buyer?

I'm a newbie, so take this anecdote for what it's worth...

My husband and I put in an offer on an REO prop in CA last month. Same deal - all the utilities were off. We didn't get as far as asking the bank/owner if we could turn them on because we ended up in a three-way bidding war for the house (so much for a slow market). However, one inspector we talked to said that 1) he'd be surprised if the bank was willing to have the utilities turned on and 2) usually when they're off and then on again seals contract and crack and then you get leaks (i.e. water), among other problems so it was not an ideal scenario.

However, it's possible the bank would have allowed us to pay for the utilities to be turned on; in the end, we were outbid anyway - oh well.

good luck - keep us posted!

I personally find it odd that they wouldn't winterize in a cold climate. All you need is one pipe and large amounts of damage can occur. You'd think it was in their best interest to winterize to avoid this.

Under the old VA Foreclosure system where you had your key and bid online I ran across a fellow investor who had a portable generator in his pickup. He would hook it up and made sure the AC, Heater, etc. worked. Of course you could assume nothing works and lower your offer.

My two cents!
Rick
Northern Georgia

Pardon my ignorance, but how do you go about connecting the heater to a generator? I actually have a generator, but unless you are testing an appliance that plugs into the wall, I don't see how you could do it. Aren't most heaters just hard-wired into the house's electrical system? It would also need to be one heck of a generator, since the heater would pull a ton of current (more than I think my generator could handle). Also, you'd be out of luck if the house were heated with gas (though I guess you could still check the blower).