Trupeck, Home Buyer in Cincinnati, OH

The house is AS IS. What if the bank refuses to have power turned on citing repairs that need to be made to do so?

Asked by Trupeck, Cincinnati, OH Fri Mar 7, 2014

Previous owners or thieves removed electrical fixtures and switches leaving bare wires exposed. When requested power be turned on, bank sent pics if bare wires and leaking plumbing under a sink. They will not do repairs to make inspection possible. Can you get bank financing with inspections and appraisal limited like this?

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Lucinda Tkach, Agent, Scottsdale, AZ
Sun Mar 9, 2014

You could get a 203k loan on a home. Contractor is paid at closing and home financed when repairs complete.

If you would like more details how these loans work I can set you up with the right lender.

Feel free to contact me direct. I have 10 years of experience with lender properties and distressed homes.

Sincerely, Lucinda
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Karen Peyton, Agent, Chandler, AZ
Sat Mar 8, 2014

Unfortunately "as-is" often means what it says. FHA 203K or cash (aside from a hard money loan) are your financing options as mentioned by all below. However, your agent is the best source of information to the question for which you seek an answer. My thought is - if you're requesting utilities "on" and the bank is sending you pictures of bare wires and leaking plumbing under the sink, you already have a contract on the table. If I am correct, what financing terms did you propose? What is your closing date? The bank will have to agree to changes in financing and any contract extension. An FHA 203K loan is possible but it will take time. If you don't have any, it's a moot point. Did you even see the house? Missing light fixtures, switches, and exposed wires are easily noticed.

Again, go back to your agent who will know best. Best of Luck!

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Vivien L Big…, Agent, Scottsdale, AZ
Sat Mar 8, 2014
Hello Trupeck,

You need to work with an Lender that is experienced with the FHA 203k Loan programs. Contact me and I will give you his information.

Have a GREAT weekend!

Viviven L Biggs PLC
Prudential Arizona Properties
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Shahla Mentha, Agent, Scottsdale, AZ
Sat Mar 8, 2014
I have sold several lender owned homes in AZ. These homes are sold in "As Is" condition and most often without any repairs. It sounds like you would have to buy it cash or get 203k loan, but in your state your Realtor is the best person to ask.

Good luck
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Byron Hebert, Agent, Ormond Beach, FL
Sat Mar 8, 2014
Not sure about foreclosed homes in OH, but in FL while many of these properties sat empty for years prior owners, and other thieves ransacked many of these homes. The most popular item of theft is anything that has copper in it. I have seen lots of foreclosures with all of the electrical wiring stolen from the walls, attic, and crawl space. Ac systems stolen, plumbing pipes stolen, you name it. As others mentioned above if the bank refuses to turn on water or power that should be a big clue to the condition of the home. Experienced investors with cash buy these kind of homes all the time, because they know what it costs to fix and usually the bank already has these homes at a huge discount. Keep in mind most investors can't even get insurance on these homes until the repairs are made and the home is livable, other than a expensive fire policy only.

Going forward I wouldn't waste your time trying to get the bank to repair the home. The Bank is not going to do it because there are plenty of other buyers who will purchase the home as is. Even though these homes can seem like a great deal, they usually are the best deal for investors, not owner occupiers. Hope this helps and enjoy the home hunt.
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Annette Law…, Agent, Palm Harbor, FL
Sat Mar 8, 2014
T in Cincinnati.
"AS IS' means as is.
The price may be reflective of the condition. Your REALTOR can answer this.

Such a house should only be purchase by those EXPERIENCED in home rehabilitation. These folks DO NOT rely on a home inspection and know how to assess the costs involved. $3,000 for an electrical panel won't distract them a bit. The know the cost of kitchen appliances, water heater and HVAC. They have folks who will redo the outlets and wiring and install the contemporary ceiling fans. They even have folks to address the roofing and plumbing AND KNOW THE COSTS.

To compete in a distressed house marketplace, you really need to have the same skills.
What will happen depends on the value the house represents, cost of repairs and the offer on the table. This is the situation where CASH IS TRULY THE KING.

An FHA 203K from Wells Fargo will not hold a candle to a 70% cash deal.
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Doug McVinua, Agent, Gilbert, AZ
Sat Mar 8, 2014
The options for financing a home without power or water are going to be limited. Options exist depending on the circumstances, who owns the property, your available cash, credit etc.

Please make sure you have an experienced Realtor representing your interests and searching for the best possible situations for you moving forward.
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Jennie Miller…, Agent, Phoenix, AZ
Sat Mar 8, 2014
You will want to speak with a lender and your Realtor about the condition of the home and the financing that you have lined up. It is common for lender owned properties to need some work before they are habitable. The lender that you are working with might offer renovation financing and that will allow for a home to be purchased that needs some done on it. Do you have a Realtor that is representing you?
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Jeff Fisher, Agent, Scottsdale, AZ
Sat Mar 8, 2014
Paying cash or a obtain an FHA 203K loan for repairs. Always consider this when making an offer and plan for the worst for as-is homes.
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Suzanne MacD…, Agent, Morristown, NJ
Sat Mar 8, 2014
You will either have to pay cash or use an FHA 203K loan to get the repairs done. You will also have to buy the house with a limited inspection, so base your offer on the worst case scenario. Appraisals can still be done, FHA does them all the time for their 203K product. Talk to your lender. 203K is a great way to go for a house like this, their inspectors and appraisers are used to working with these kinds of houses and you may be able to get a really good deal if you are willing to do the work.
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Ronald Reyes, Agent, San Diego, CA
Sat Mar 8, 2014
Hello , I am sorry you are going through this situation. In all sincerity this is where your Realtor comes in to bat for you. Communication and better yet negotiation is key. Either we convince the bank who has possession of it to provide the inspector what is needed to do his job or they reduce the price substantially so the lending bank can make a decision. Remember where everyone is coming from the current bank does not want to lose anymore money and the new bank does not want liabilities. Effective communicator will let the bank know how this may influence the sale in either case. You could also submit an offer where both parties meet half way. A lot depends on type of loan and the lender. Your Realtor can talk this through and submit an offer stating upon passing of inspection you will pay a fair amount. Hope this was helpful and if it was please provide feedback for my profile. Thanks a million!
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