I am huge on inspections, wanting to know as much as possible about a house before I put down any money. In general, I have a professional inspector go through the entire property.
Recently I've come across some renter occupied wholesale properties. One of them, I let go because I couldn't get in and do a thorough inspection.
For those that have experience buying renter occupied wholesale deals, how do you handle inspections, given that this is sometimes touchy?
Does anyone have experience buying wholesale renter-occupied properties? I'd love to hear about you experience, especially in regards to inspections.
Ideally, you would get the renter's information, contact them, and ask when in the next few days or so would work for their schedule. Legally, the owner of the house has to give one day's notice for an emergent/urgent repair, or three days for non-urgent, at least in Washington State. It's not your fault the owner is selling, so they should be courteous to you even though this situation may potentially be a hardship for them. Treat them as such, and hopefully they will respond in kind.
This is one of the things that if the wholesaler was honest with the owner would be easily handled; however, since most are not, they owner is confused and so is the tenant as to why someone is parading around multiple people in the property.
I am surprised that the wholesaler even has a contract with an inspection clause in it. If the contract has an inspection period then the owner must honor it. Have the wholesaler arrange with the owner and tenant an inspection date. Then you show up and do the walkthrough along with the wholesaler.
I have also found that most owners do not want to share with the tenant they are selling. Even if a right of first refusal may exist in some states, some owners neglect to tell the tenant. Be careful with that as well and that is why inspections can be difficult with occupied rentals.
Thank you for the replies. As usual, this is great information. @Tyrus Shivers This is not really an issue of the seller not telling the tenant here. Also, there is no inspection clause, it's inspect before you sign. I'm going to go out with a professional inspector to go over the major items and check permits since the square footage is not as listed with the property appraiser. I know some may consider it overkill, but like I said, Im big on inspections.
No problem. I understand now. So you pay the inspector each time you see a property from a wholesaler? That is good practice, but could get expensive quick. If it works for you great, I am a fan of inspections as well.
Only the ones I want to buy :)
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Get the Ultimate Beginner's Guide
Sign up today to receive the popular eBook for free!