Buying a fixer with cash

5 Replies

@John Plonty Your due diligence period mainly consist of two things -

#1 Make sure it does not have any unpaid taxes or judgments or liens. However, that should be covered in the normal title process.

#2 - Unless you are certain about the repairs needed, make sure you have an inspection clause saying that you have a certain amount of days to walk through the property with your contractor.

Between those two things, you should be fairly certain about what you’re getting into. Good luck!

@John Plonty The process is basically the same as when you buy with a loan, except some things become optional.

For example, you no longer are required to to get an appraisal, flood insurance (if in a flood zone), or even basic home insurance. Now, all of these things are generally good ideas, and you might choose to still get them. There’s just no lender to require it.  

You should also still close though a title company to make sure any existing liens are taken care of so you end up with clear title, get an owner’s title policy (obviously you won’t have to buy a lender’s title policy though), get any necessary inspections (e.g. home, roof, pest), etc. 

If you have an agent, they can help guide you through most of this. But if you don’t have an agent, and there’s also no lender to require these things of you, it’ll be on you to know what you need and request/obtain them. 

@John Plonty

If you have a savvy escrow officer ask them as many questions as possible. Do not rely solely on the real estate agent or the escrow officer. An escrow officer who knows what they are doing can be very helpful.