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(Roof, Termite, HVAC, Electric, Plumbing, Mold, Engineers)

Ask/Set Appointment. Study Comps. 

Start with Tour. Then discuss Net Sheet. 

Exclusive Right of Sale Agreement

Photos/Reel media 

Lockbox 

Yard Sign

MLS / Open House 

Offer amount higher

Emd higher 

Waived financing (cash)

Shorter/Waived inspection 

Waived appraisal

Appraisal gap

Escalation clause 

Offer $ direct toward seller CC’s

Buyer pays Title

Post-occupancy for seller to move out slow

Use Seller’s Lender/Inspector reference 

Personal letter/photo

Just like products have labels, so do houses. Theirs just come in the form of disclosures. And some houses may affect the person living in them's health. Here's some insight, received directly from a licensed home inspector:

MOLD - Moisture is the enemy, and is the life source for mold/spores. A water or moisture leak behind a refrigerator, under the sink, etc. is wet, dark environment that mold grows in. Once the cause of the leak is stopped, the mold can not remain active. It eventually dies. However, both dead and live mold/spores can still be a health issue for some people if not cleaned/removed.

LEAD-BASED PAINT - Back in the day, before 1978, the paint had a highly toxic metal in it which is harmful if ingested. Not smelled. But eaten. Unfortunately, young kids used to eat paint chips from the baseboards, etc. and this was how the problem became known.

CHINESE DRYWALL - During the boom 2001-2006, we couldn't keep up with all the demand for new construction. So we asked China for help. And unfortunately they mixed in their garbage with their drywall pieces, manufacturing this synthetic drywall. While it sounds hazardous, the main victim of this drywall was copper. Primarily, the HVAC systems, and electric panels. The gas from this drywall would turn them black and eventually the HVAC and electricity would malfunction/shut down.

RADON GAS - Comes from the earth, naturally. Picture the earth smoking cigarettes, this is the smoke cloud. However, imagine the earth only takes one puff and puts it out. It's not excessive, and it only becomes a hazard if it can accumulate. Say in a basement or a contained room. But once an outlet or door is opened, the gas escapes into the atmosphere and then there is no more concern. Ventilation, naturally. Not necessary to test for. But everything has warning labels, just in case. 

ALUMINUM WIRING - Was a great idea for conductivity to go with aluminum. However, the devices connected with them weren't originally designed with aluminum in mind (junction boxes, outlets, switches) so a fire hazard presents itself. Most common up until the 1960's. Copper is the go-to now...

GALVANIZED PLUMBING - Another system that became outdated and corroded away. Most homes are using copper, plastic, or PEX (a synthetic combo of metal and plastic). Regardless of the system, most don't last more than 40-50 years....

ASBESTOS - Another method that became known-hazardous and outdated. Building homes containing asbestos. Which is a hardened mineral, that when broken contains millions of microfibers which, once airborne and inhaled became a health concern. Think of it as a sleeping dragon. It's use and trade became restricted by the 1980's. It's removal requires a special hazmat team.

SINKHOLES - Rainwater is the best known culprit. The level of earth beneath our soil, but not quite as deep as the drinking water aquifer we tap into, gets run down with drain water, standing water, or rainwater. And some of the rocks dissolve in that layer, causing them to sink further down, creating the depression in the earth over time. These can be remediated.

One of the most common reasons a deal gets killed is the property's condition itself via inspections/appraisals....   

First and foremost, do note that all INSPECTORS, APPRAISERS, and LENDERS are different. While they all generally <should> follow a similar code, some of them are more relaxed than others.    But where we can improve our own skillset, our own eagle-eye, is by being selective with certain buyers (loans) when our client is on the sell side. And also being selective with certain properties (homes) when our client is on the buy side. This way things align, or at least give you a head start on setting the best expectations you can....   

In a nutshell, FHA/VA Loans are stricter when it comes to the property appraising. Appraisers are trained to focus on all things SAFETY and FUNCTION. Repairs flagged, and are "subject to", must be repaired BEFORE approval/closing. Common repair items the appraiser will look for are environmental issues (gas, sinkholes, etc.), safe and functioning electrical, plumbing, and HVAC systems, at least two years of life on the roof (free of leaks), structurally sound foundation for life of loan, unpermitted additions, defective paint, accessible/clear crawlspaces, free of wood-destroying organisms. Screens in windows.   

Conventional Loans are generally focused on the "4 Point Inspection" being acceptable for an insurance company to deem the property insurable. This of course will likely imply that anything summed as a FIRE/WATER hazard needs to be replaced. Exposed wiring, plumbing/roof leaks, etc. Some lenders will allow repairs be made after closing, with proof of repairs being submitted in order to uphold the insurance policy. But these decisions are up to that appraiser to flag or not and that lender to underwrite or not.    

Side notes:    Mold is a health concern yes, but not a contingent remedy for loan approval. An appraiser will be more concerned with the source of the mold tho - and of course recommend it's removed.   

Appliances do not have to be present. They do however have to be operational. If they are not, their loss of value can be deducted from the overall appraisal amount.   

If you have a listing - it's highly advisable you are able to categorize that property into which loans would "work" or not. This will help your client select the best buyer option, and potentially save them time.   If you have an active buyer - its highly advisable you are able to search and show properties that are more suited to their loan guidelines. This will help your client potentially save time and inspection/appraisal expenses.  

Lastly, get comfortable communicating with the lenders involved, they are the ones ultimately buying these properties, hence the guidelines!

Roofing: Minimum 5 years of life needed to procure homeowners insurance via 4 Point report.