Home Buying in 55405>Question Details

Kate H, Both Buyer and Seller in Minnesota

if I am sell my personal residence to a friend "non mls" who is going to fix it and flip it do I need to have a Truth in Housing inspection

Asked by Kate H, Minnesota Wed Jul 11, 2012

done?

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A city of Minneapolis Truth In Housing report needs to be done by an inspector on the city of Minneapolis approved list. For a list of approved inspectors for Mpls see the link below.

Make sure you check out what the inspectors will look for and make those repairs BEFORE inspection. Otherwise you will have to pay a $75.00 reinspection fee. The most common repairs found in TIH are basic repairs that cost less than $25.00 in parts (but some repairs will require a licensed plumber or electrician).
0 votes Thank Flag Link Thu Jul 12, 2012
Really a great point Michael!
Flag Fri Jul 13, 2012
Hi Kate,

Yes, you need to provide a TISH prior to closing. The TISH is posted online and is public information. If you have any equity in the home you may be able to get a HELOC and have the work done yourself (and profit from your situation). Please call anytime if you have questions. You probably will need a professional Realtor to facilitate closing of the transaction.
0 votes Thank Flag Link Thu Jul 12, 2012
HI Kate,

You have received a lot of good information and some a bit harsh. The short answer is, yes, you will need a TISH report. There are a number of qualified inspectors that will do the report and necessary paperwork. That being said, the TISH is only one area where expert advice is needed in navigating a successful sale of a home. There are different types of representation in Real Estate. In your case, the, since you have a buyer, your best option is a facilitator. This person would provide you and your buyer w/ all of the necessary paperwork and legal documents needed for a successful close. There is a fee for this service that can be negotiated and is significantly less than the typical commission. Once you have the paperwork complete and signed, you will need to select a title co that will do the proper title work required to change the ownership.

As you can see, there is a lot that goes on in typical real estate transaction that isn't always apparent to a typical buyer/seller. If you would like to give me a call, I would be happy to show you what you will need and help you to make the best decision for your home.

I hope this was helpful and wish you the best of luck.

Mary Myhre
Re/Max Results
612-387-0047
0 votes Thank Flag Link Thu Jul 12, 2012
Kate,

You have your answer. It is unmistakably a YES. I recommend talking to the city of Minneapolis because they have rules on when you have to have this done before actualy engaging in a sale. So be very careful to follow the rules and avoid any fines.

And, as has been suggested, make sure you either have a competent realtor draft all the documents or have an attorney do so. Using a realtor will be simpler and cheaper. Whatever you do, treat the transaction with a lot of legal respect. There are a lot of things that can come back to bite you later.

Mark
0 votes Thank Flag Link Thu Jul 12, 2012
Huh well everyone has answered your question and indeed the answer is yes. I don't know who will help you draft up the purchase agreement, along with all the required disclosures like some others have pointed out. I will do it for very cheap if you want on a flat fee, or hopefully you are going through an attorney.

Really what caught my eye with this question is why are you letting your friend take advantage of your money? Are you two going to do some type of profit sharing in the end?

It just seems weird to me that you are going to sell your property somewhere at 65% of market value just so your friend can make money off of you. I thought the whole point of not using realtors was to save on commission and your bottom line, but if you sell even lower either you don't like money or just don't understand what you are doing.

And who knows maybe your friend does not know to flip a house either so the numbers are not as bad as I think they may be. All I am saying is that if it were me I would do a equity partnership at the very least. Even my best friend of 25 years would not so easily get my money!

Because Fix it and Flip it means your friend should make 20-25k on the property, and really closer to 30k if they understand.
0 votes Thank Flag Link Thu Jul 12, 2012
In Minneapolis, the seller is required to proide the buyer, even if it is a friend for family member, with a Truth in Housing inspection before they accept a purchase agreement. The buyer can assume required repairs, and would do so by signing the waiver that is accepted on the city of Minneapolis site. Or, you couldl provide a Certificate of completion once repairs are done.

If who ever you are selling to intends to flip it, they would have to clear the required repairs and provide a new Truth in Housing to potential buyers. They cannot resell without a new TIH.
0 votes Thank Flag Link Thu Jul 12, 2012
That depends in which city you live. If you are in Minneapolis, Richfield, St. Louis Park, St. Paul or other close in areas the answer is yes. If the house is in a third tier suburb, the answer is possibly 'no.'

You can find the answer by contacting the city government.
0 votes Thank Flag Link Wed Jul 11, 2012
If your property is located in Minneapolis, the answer is generally "yes". There are rare exceptions. Even if you and your friend have reached a verbal agreement, there are things that should be done. A truth-in housing inspection is just one of the things. There are a number of disclosures that you are required by law to disclose. I can provide you with all the necessary forms and help the two of you to go through all the necessary steps between now and closing. If you'd like help, call me. 763-228-2967
0 votes Thank Flag Link Wed Jul 11, 2012
I forgot to mention that it is in mpls
0 votes Thank Flag Link Wed Jul 11, 2012
Then yes, you do need a "Truth in sale of housing" report done by a qualified inspector. Only certain inspectors are able to legally do these.
Flag Thu Jul 12, 2012
Kate,
It depends on what city the property is in. If you would like, I can email you a list of each cities requirements.
Dan Warnest
dgwarnest@cbburnet.com
Web Reference: http://www.danwarnest.com
0 votes Thank Flag Link Wed Jul 11, 2012
Yes-unless it's a qualifying condo/multifamily dwelling. If you are looking for a great inspector, Richard Olson of Danrich is great! 952 920 1360. Happy flipping! (btw, I'd love to see before/after pix as I have people looking all over MPLS for great homes! tcrealtor@gmail.com)
0 votes Thank Flag Link Wed Jul 11, 2012
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