Apr 15 2008
Two Scary Words, and how they apply in Real Estate
Potential home buyers might be inclined to run screaming from two small words: “As Is”. This phrase can signal anything from a house that’s falling apart to one where the seller is just not in a position to make disclosure on an otherwise perfectly good property. An article by Dian Hymer attempts to take some of the fear out of this tiny phrase.
“As is” can have several different meanings. It could be the property was inherited and the heir is unable to inspect and make disclosure on the house. The label on an inherited property is put there to protect the heirs from liability.
A bank foreclosure is usually sold “as is”, as the bank is not in a position to inspect the house. However, a homeowner who has not been able to make mortgage payments, may not have had the funds to keep up with maintenance either.
It could also be subject to regional regulations. California, for instance, advertises most homes in “as is” condition. This only means the seller won’t warrant the condition of the property and it’s strongly suggested that the buyer retain a professional inspector.
It could also pertain to a property that needs major repair. In the current buyers’ market, the purchaser is not as willing to accept the “as is” condition without a significant drop in price.
The bottom line is a potential buyer could get a good deal on an “as is” home, but he or she should conduct a thorough, professional inspection of the property and be prepared to make what could be major repairs. Buyers are also encouraged to make sure they have the option to withdrawal from a sale without loss of deposit should the property need more attention than they’re willing to give.
