Home Buying in Los Angeles>Question Details

Adlara13, Home Buyer in Islip, NY

offering lower amount... all cash in order to save the seller from fixing alll illegal issues of the property.... there are many! reasonable?

Asked by Adlara13, Islip, NY Wed Feb 12, 2014

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Reasonable to who? If you are the only person interested no prblem, but if there are other buyers interested in the property your low ball approach may put you out of the picture.
2 votes Thank Flag Link Sun Feb 16, 2014
If the seller accepts then the answer is yes! If the seller has another buyer in the wings, your offer may help out the seller in getting a better offer. And by the way, 'not up to code' or 'not permitted' are quite different.than illegal. If illegal, no one will be buying this real estate with a clear title.
1 vote Thank Flag Link Thu Feb 13, 2014
I don't know, what does your REALTOR say? We have no idea what property you're talking about, or what "illegal issues" there are that need to be fixed.

I'm curious what you mean by illegal issues? Are you saying there are items that aren't up to code? There are zillions of homes out there that aren't up to code, because codes change over the years. That doesn't make them "illegal". It's up to you and whether you want to buy a property with issues or not.

Your agent should be doing a market analysis on the home to see what similar homes have been selling for in recent months. If it does need a lot of work, then make your offer and see what happens. They can reject your offer, counter it, or accept it!
1 vote Thank Flag Link Wed Feb 12, 2014
Best advice would be to look at comparable sales of similar size homes in bad condition that also cannot qualify for financing. Figure out how much it would cost to restore the home to make it habitable. Then look at the sales prices of homes in good condition. If you can purchase it and renovate for less than the cost of a move-in ready home, then it could be a good deal for you. The seller is the only one who can decide if your offer is reasonable.
Flag Thu Feb 13, 2014
It isn't about some "work" which it needs.... its about haphazard structures that were used to house many asian illegals who worked for the owner in his restaurant... my husband has been in construction for 340 plus years... the structure in question had no heat... was divided into several compartments the size of a twin bed and the walls do not meet the ceiling... in addition, no way to exit and extremely dangerous... it was placed under the upper story deck which will have to be demolished in order to rid the structre that is not up to code and never will be.... please respond... interrested in your opinion and if i could send pictures i would... by the way...engineers report had so many flaws that prople needing to finance had to back out as they could not get a mortgage from any bank
Flag Thu Feb 13, 2014
Sure,why not,but all depends if seller has multiple bids & you are getting it because you have a cash offer .If you drop the price too much they will usually go with the next offer .Good Luck !
0 votes Thank Flag Link Mon Feb 17, 2014
I understand Cash is King, however the transaction isn't much different than one with a solid buyers preapproval letter.

If the property has something illegal and that would prevent conventional financing, I can see a cash sale as a solution to the problem.

Put yourself in the sellers shoes and if its a mutually beneficial solution, it may work. Low balling may shut the communication channels down.

Good Luck!
0 votes Thank Flag Link Mon Feb 17, 2014
This would depend of the motivation of the seller. Also, was the listing price reasonable? Offering less than asking should be based on value, vs, simply offering less than list.
0 votes Thank Flag Link Mon Feb 17, 2014
Maybe....I would have to look at the property, and the offer. Cash is King, as they say but if the offer is too low, even cash could be rejected. You need a good Realtor to help you structure the offer so that it is accepted.
0 votes Thank Flag Link Thu Feb 13, 2014
Doesn't matter if we think it is reasonable. It matter if the seller thinks it is reasonable. And they are the only ones that know that.

Alex Greer
Loan Officer
NMLS #1056079

http://www.TheMortgageOutlet.com
408-352-5147
AGreer@TheMortgageOutlet.com
0 votes Thank Flag Link Thu Feb 13, 2014
Yes, it is very reasonable and we have clients on both sides who have benefited from this type of transaction. We do this all of the time, especially on distressed assets. There are other factors that you would want to take into consideration for liability purposes but in a standard sale where there are "illegal" or unpermitted structures, etc. offering a lower amount in cash is a reasonable thing to do. If I can help in anyway feel free to message me. Good luck!
0 votes Thank Flag Link Thu Feb 13, 2014
It depends on the list price relative to the comparable sales in the area...if it's already priced at a discount to reflect any issues it may have, the sellers may not want to go any lower. If it's a great deal for the area, you may find yourself bidding against other buyers. Just because a home needs work doesn't mean it will sell for less than list price!
0 votes Thank Flag Link Wed Feb 12, 2014
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