Hey BP, I need help!
Quick details, sorry for length. I’m under contract on a house and my inspections and appraisal just came back. Appraisal value is 120K with comps around 135K+ & the current purchase price is 105K. Great area for rentals with new Amazon Distribution center opening next summer 10 minutes away. (1500+ new jobs)
Inspection came back with minimal major issues aside from the large crawl space foundation issues. I got a foundation expert to come check it out and he estimated around 11-12K in repairs.
Basically the back corner is cracked and water is coming through the other end and washing out the support over time and is creating a problem. His quote was to completely waterproof seal the entire crawl space & jack up/repair the back corner & I think possibly 3 new support beams on that end.
I don’t necessarily have that kind of cash to pay in full, but he said I could possibly roll it into my loan/finance? Am I taking on more than I can handle? Should I get a second quote and renegotiate the sale price minus the cost of repairs?
I don't know if you can tack that onto your loan, I doubt it, but someone else might say otherwise.
As for the repairs, just go back to the seller with them. You could ask for cash back to pay the repair or partial while you keep your offer price the same. Or ask that they contribute that price towards closing costs that way you can use your cash on repairs instead. I think they would go for that since they don't have to come up cash that way either.
You should always get multiple quotes. At least 3. Foundation issues are tricky... Be advised that jacking up the home may cause cracking and other issues inside the home. The price you were quoted seems a little high to me. We just remediated a sinking joist for just under $2k.
water is coming through the other end and washing out the support...
You have a drainage problem outside the crawl. Solve that and repair the foundation. If needed, add a crawl french drain, sump pump and 6 mil vapor barrier. I would not seal the crawl on a rental.
@Terrell Garren I believe that’s what he suggested. He did say something a pump that pulls the water out of the crawl space and like a pool liner type material. I may have misunderstood
@Trenton Miller I have a couple more quotes coming, this was just the first one. It just alarmed me as I didn’t think it was as bad as it was. Once you went under the crawl space it got a lot worse than just a crack outside. Unfortunately I only have 3 more days for due diligence and figure out my game plan
You can use this as an opportunity to renegotiate with the seller. “There is an additional 11k in costs here that exist right now”. Also, there are ways to incorporate this into the price such that the loan covers it. A great agent should be able to help you out.
But at the end of the day, stick to your criteria. If the seller won’t budge on price, but it still makes sense, then move forward. If not, then walk. Don’t be afraid of losing any deal to walk away from a bad deal.