Flipped homes are increasingly enticing. Rehabbed rooms, new appliances and freshly landscaped yards are the norm for these gem properties. However, there are a number of questions that you should get the answers to before buying a flipped house. Here are six important questions to ask:
1. Are There Any Liens Against the Property?
After a homeowner puts their house on the market, there may be hurdles. If one (or more) of the contractors used in the home’s remodel haven’t been paid, there could be a mechanics lien on the house for outstanding balances due.
2. Is the Home Located in a “Full-Disclosure” State?
Some states, like Texas and California, require sellers to disclose all information they know about the house to potential buyers. When looking to sell, you may need to provide evidence of inspection and proof that work is up to code. Some repairs may signal potential ongoing problems with the home. For example, if the basement has been remodeled several times in the past few years, there could be issues with seeping ground water or flooding.
3. Was Proper Paperwork Pulled for the Remodel Work?
If there’s a paper trail of permits from the city, the upgrades done to the house are more likely to meet the city’s safety codes and standards. If there are no records of building permits, the work was probably a do-it-yourself project, and may not be as thorough or professional as you’d like. Consider hiring an independent home inspector to evaluate the quality of work. Remodeling work that is not up to code can limit your financing and insurance options when buying a flipped house. Plus, when looking to sell down the road, you may need to provide evidence of inspection and proof that work performed is up to code.
4. Does the House Come With a Home Warranty?
Since the remodeling work was done quickly, and most likely by spending the least amount possible, some problems may have been masked or hidden. Buying a home with a home warranty can give you peace of mind that the main systems in the home can be repaired or replaced on a budget by the warranty provider.
5. Did the Sellers Live in the Home During the Remodel?
To save even more money, some sellers will camp out at the property. This can actually be a good thing because the new plumbing fixtures will have been used a number of times. Many flipped homes experience water leaks or clogs in fixtures that have never been tested or used regularly, such as a basement floor drain, shower drain and piping under the sink. Ask your real estate agent if you can test these fixtures by turning on the shower, filling up the sink or bath tub and then watching them drain.
6. Who Was the Contractor on the Job?
Finally, ask the real estate agent to find out who the seller hired to handle the project. Then go to that business and make sure the home you’re considering buying was the one they actually performed the work on before you investigate further. Are there any complaints lodged against the contractor via the Better Business Bureau? Is the company known for quality work in the community? Asking these questions before you sign on the line can help you in the long run.
Are you in the market for a new home? There are some questions you should find the answers to before buying a flipped house. Follow this advice, and when you’re ready to start your search, head to Owners.com for the listings and resources you’ll need to be successful.
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