If you are a short sale specialist, you know that negotiating with the bank to set an acceptable sale price can be tricky. The bank may not want to reduce the price of the house enough to make it attractive to potential buyers. In that case, you may be stuck doing a lot of work and simply not being able to close a deal.
Occasionally, there may be a benefit to having a house inspected early on when you are trying to arrange a short sale. Texas is one state where this might be particularly beneficial. That’s because homes in locations like DFW often have lots of hidden damage that reduces the value of the property. Here are a few examples:
· Foundation trouble from the constantly shifting clay soil
· Hail damage to the roof
· Water damage in the attic from a leaky roof
· Termite or carpenter ant damage to wooden materials in the home
· Mold in ducts, behind drywall or under carpet from high humidity
The homeowners may be unaware of these problems and therefore not able to disclose them as required by law. If they are aware of any issues that lower the value of the home, make sure they provide you with a complete list during your consultation.
Sometimes Less Means More
Typically, it makes sense to wait for a prospective buyer to pay for an inspection. After all, they are the ones who stand to gain from the information in the report. But if you want to get the house on the market at a lower price to ensure it sells fast in a tough market, you and your client might decide it’s worth it to have an inspection done earlier. It sounds counter-intuitive since you’re used to trying to ensure that a house sells for as much money as possible. But in the short-selling business, sometimes you really do want to (ethically) drive the selling price down to benefit your client.
Why do this ASAP? Lenders may not want to make last minute adjustments to the agreed-upon sale price. If a buyer finds out about serious problems that impact the value of the home late in the game, they are likely to want to revise their offer. Getting concessions from the lender on the sales price up front may mean less delay and less chance of a buyer walking away.