Our 1st Deal: Lakefront Short Sale Near Downtown Gilbert, AZ

[Ty Wightman]

Hi BP! My wife and I are about to start the inspection process on a SFR about a half mile from the quickly developing downtown Gilbert area outside of Phoenix. The house sits on one of the many artificial lakes here in the desert, and was built in 1993. Our plan is to live there for a year or two and then buy another distressed property to live in, and rent this one out.

Comparable homes in the area are selling for around $305k - $320k after renovations, and the seller's lender (Wells Fargo) accepted our offer price of $275k but will not make additional concessions for any repairs. Aside from the paint and carpets that need to be replaced, I noticed a crack that runs along the grout that may be indicative of foundation heaving - something we are going to have several foundation experts look at before we hire an inspector for the rest of the house. The way I see it, if the foundation repairs cost less than $10-15k this could still be a good deal if there are no other major repairs needed.

Wells Fargo is currently waiting for HUD approval, which they say could take a couple weeks, but we are planning on starting our inspection period early next week. Any thoughts or advice for us newbies? Thanks in advance!

[Minna Reid]

This is why I always have inspections happen right after contract, and ideally before BPO. That way everyone starts off with the same knowledge of condition issues and you are less likely to have a value problem later.  However, If you can document other necessary repair items, the listing agent can compile a value dispute for the lender, which may or may not result in them lowering their value.