Repairs before closing

[Jackie Sawyer]

Hello Biggerpockets Community! I am currently under contract to purchase a townhome with owner financing. There is no bank or HUD involved, I am dealing directly with the owner. There is a bit of work that will need to be done; new roof, cabinets, drywall repair and painting etc. and seller has requested a longer escrow period (2 months); . It is currently not occupied and looks like the last tenant pulled a midnight move out. I know there is risk involved, but I would really like to do some of the work during this escrow period. I'm pretty sure owner would agree its ok, but do you have any suggestions for me to help minimize my risk? My best chance to rent it before summer is the same week I'll be closing.

[Benjamin Aaker]

Hi Jackie,

First, you need to find out why the seller wants to close in 2 months. Sellers usually want to close tomorrow if they can. The fact that the tenant is gone, might make the seller want to close more quickly. I don't recommend paying for any work in that place prior to closing. You could lose that money or something could go wrong with the repairs and there will be a fight about who owns the problem.

If you insist on getting work done while in escrow, then you should increase the sale price by the repair costs and have the seller do the repairs pre-closing, contingent on your satisfaction with the repairs at the walkthrough.