Posted on August 29th, 2013 No comments
I was out on Brokers today and here’s a listing that I liked a lot. 3635 Michelle Drive in Torrance. It’s listed at $849,000 by RE/MAX Estate Properties. It’s in a good location on a lovely street. It has a really nice, homey feel. It has some nice updates but there’s room for more – which always means more equity! This one is worth checking out.
Posted on August 29th, 2013 No comments
So you have fallen in love with a home. You made an offer; the sellers accept it. And now you do your inspections. And you’re shocked by all the things that the home inspector points out that needs to be fixed, replaced, upgraded. All the safety issues; all the concerns.
First I will tell you to take a deep breath. Every house is going to have its issues. Even the cleanest of homes is going to have some things to deal with. You will sit down with your Realtor and decide how to approach the situation. Here are some of your options:
You can ask the seller to make repairs.
You can ask the seller to credit you the cost of the repairs.
You can ask the seller to reduce the purchase price.
You can ask for any combination of the above.
Second, you should know that the seller doesn’t have to do anything. And in the state of California, the seller doesn’t even have to respond to your request. More than likely they will, but keep in mind that they are not contractually obligated to do so.
Third, be careful in what you ask for. I’ve seen many buyers list every single item on the inspection report. I understand that you want to get as many repairs taken care of as possible, but you may also turn off the seller so much that they don’t want to do anything. Many sellers get so infuriated that they no longer approach the Request for Repairs with an open mind. Or you may risk the seller agreeing to do the items on the list that are least important to you and ignoring the ones that are the deal breakers. It’s important for you and your agent be strategic in your request to get the most favorable outcome.
Fourth, there’s a trade off with asking for repairs vs. asking for a credit. If you ask for repairs, the seller will take care of the work, but you may not have control over how the work is done. However, what appears to be a minor repair can sometimes turn into an expensive ordeal. The good news here is that the seller has agreed to do the repair and no matter what the cost, they must fulfill their obligation. On the other hand, if you ask for a credit, you are able to do the work yourself. There will be less risk in getting sub-par repairs. However, if you don’t get proper quotes up front and there are surprises along the way, you may not have collected enough of a credit to take care of the repairs. There is risk in both sides; you have to decide which option works best for you.
Posted on August 21st, 2013 No comments
When you buy a home, your lender requires a copy of the purchase contract. They want to make sure that all the terms are met and their investment is protected. One of the sticking points is often the termite work. Once you include the Wood Destroying Pest Addendum in your contract, the lender requires that the work is done prior to close, and in some cases, prior to funding the loan. Without the termite clearance – proof that the property is clean – the lender will not approve your loan.
Typically, in southern California, the seller agrees to pay Section 1 items and the Buyer will be responsible for Section 2 items. Section 1 items are those that must be fixed, i.e., dry rot, termite infestation, etc. Section 2 items are things that are not a problem now, but may lead to a problem later. These are preventative measures. The lender normally is not concerned with Section 2 items, however I have heard of some lenders requiring Section 2 items to be repaired as well. Consequently, I advise my buyers not to agree to Section 2 items so that the lender doesn’t require they be completed. This is as simple as not checking the Section 2 box on the WPA form.
South Bay – Redondo Beach, Manhattan Beach, Hermosa Beach
In the South Bay, we do come across some challenges from time to time. Due to the fact that we have many properties that have 2 or 3 attached town homes, but no active HOA, a problem arises when the seller of one of the units has termites and needs to tent for fumigation. In order to tent, they have to tent the whole structure which includes his attached neighbor(s). But what if the neighbor doesn’t agree to tenting? You are forced to do secondary local treatment to eradicate the termites, but the lender might not accept this alternative treatment and the loan, and ultimately the deal, could be in jeopardy.
This can also be the case with two detached units that share the same gas line. Because you have to shut off the gas during fumigation, the neighboring unit must agree to this. It can make for a very sticky situation.
If there is no way to convince the neighbor to cooperate with the fumigation, the other option is to remove the WPA from the contract. Once the WPA is not part of the contract, the lender will not require the work. However, as a buyer, you must be comfortable with he fact that the termite work will not be completed and you may need to tent in the future if and when your neighbor is cooperative. You may want to negotiate a credit from the seller for the cost of the fumigation in exchange for removing it from the contract in order to close the deal.
Posted on August 1st, 2013 No comments
Just got an accepted offer on 602 S Broadway, #A! It’s a custom built townhome in South Redondo just a few blocks to the beach and close to Riviera Village! It has 3 beds and 2.5 baths with 2,355 sq. feet. There are 18″ ceilings in the living room. This home is light and bright and feels welcoming the moment you step inside.