Apartment with mold??

[Ki Lee]

Hey BP,

I'm considering a MF investment in the Ohio area that has pretty solid bones and good potential.  It's townhouse style garden apartments, 2bd 1ba in a C+/B- area.  Definitely not war zone, but lower working class neighborhood.  I found out that some of the buildings had leaking roofs in the past which caused some molds in ceilings and walls and basements of a lot of the units.  The roofs have been fixed since, but I'm trying to see what this will do for my eligibility to get covered for insurance, to qualify for a loan, and also how much resale value is affected?  Is this a big can of worms for potential liability, too?  Obviously, an inspection is required and there are different degrees, but I want to know if this is generally a big red flag that's going to be a massive headache in the future.  What's your experience?  Do I have to immediately address all mold issues before qualifying for loan/insurance, etc?  The issue is that it spans across many units as the units share walls and ceilings.  fixing the issue for all affected units sounds like a big project. 

Thanks.

[Michael Ablan]

@Ki Lee -  This can range from no big deal, to F*$K, my deal is dead.

1.) Identify where the moisture/humidity is coming from.

2.) Find out how much mold growth there actually is.  You normally have to remove 4ft of drywall & insulation in all directions from where mold is found.

It's no big deal if you can  eliminate the water intrusion, cut out the sheetrock, and replace it.   It becomes a nightmare if you have to hire professional mold remediation companies, because most of the time they have the gut the house.  Now you have to pay them to gut it, treat it for mold, AND you get to start building it new.