Flipper/Rehabber · Long Beach, CA · Member since 2017 · 155 posts · 118 votes
Im about halfway through escrow period structural damage was found during the inspection. My inspection contingency window closes in two days. What should my next steps be?
FYI
This is a tri plex in downtown Riverside, CA
517k purchase price via FHA 5% down
+36k seller carry back. Balloon due in 5-7 years with $150/month payment.
B class neighborhood
Historic buildings all around. (This bld is not in historic registry to my knowledge)
Built in 1929. No estimate on cost to repair damage.
The floor on the second floor is not level due to the structural issue with the foundation.
Please advise. I want to ask for a credit back on the carry back however this was done via promissory note.
This is a house hack deal and the location is perfect. The day we went into escrow a rehabbed comp was listed on the market for 880k. I’m worried if I ask for the credit the seller will look for any reason to get out of escrow and put this back on the market.
I got this off market.
Let me know what you would do.
You will probably be abandoning this property, unless the seller is willing to pay for the repairs. Is your lender aware that you are using owner financing to help purchase the property, because if not they need to know this. FHA won't let you buy something unless structural issues are handled or you are buying with FHA 203k. A lot of those things in downtown have major hidden issues and multiple Mickey Moused add- ons
Your can hold him liable for the correction. Assuming you can prove he was aware of the structural damage and willfully withheld the disclosure.
A SfR stem wall foundation with interior supports run about 18.00 a square foot. However you may find that a mud jacking company can solve the problem for much less. After all you do have a foundation.
p.s. - post and pier foundations like yours are easier to level than foundations with concrete slabs. You can pour new temporary footings next to the existing ones in order to jack the beams up to where they need to be, then replace the existing posts with longer ones. Or decommission the old footings with new footings & posts next to them along the beam line (your footings might be undersized for the soil).
I had a similar situation with a post & beam foundation and it cost about 9k for new footings & to level 4 posts in a crawl space.