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Squid, Home Buyer in Los Angeles, CA

Insurance and Mold

Asked by Squid, Los Angeles, CA Sun May 10, 2009

I am putting an offer on a house -REO bank owned. There is some mold along the base of the back wall of the house, where the back wall meets the basement. This looks to be due to water damage -- the house has hilly terrain behind it and it looks like water has beeb allowed to drain into the back of the house. My real estate agent has explained to me that if I purchase this house I would need to hire someone to fix the issue and install a drainage system to prevent the house which am willing to do. But I wonder if the mold could create problems in getting the house insured in a timely manner, and could that impact my ability to close a loan and escrow, etc? I realize it probably depends on the extend of the mold, but I'm trying to understand worst case scenarios. Thanks for any advice.

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Hello Misslivvy,
This is one of the scary parts about buying an as-is foreclosure. You should definetely hire a certified mold inspector to take a look and assess the extent of the damage. Don't look for a general home inspector, but an actual mold inspector. Sometimes they can be both. You should be able to arrange for an inspection even if you aren't in conract yet. Ask your agent about it. If the mold has entered the house/basement then there could be much more damage than meets the eye. There are several different types of mold, and many are very bad for your health. Also, go ahead and try to secure an insurance quote on the property. If there is an extensive history of water damage and possibly several past insurance claims due to this, then you may have trouble insuring the property, and therefor securing your financing. Your mortgage company will definetely have to document insurance on the home before they give final approval. Good luck!
0 votes Thank Flag Link Sun May 10, 2009
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