All Forum Posts by: Jesse Petrillo

@Christopher Kolasa, all is fine with the property and its foundation today. I'm keeping an eye on the settlement to make sure it doesn't get worse. 

@Dave Charlton, @Christopher Meis, @Jonathan Jewell, thank you! I'm officially a landlord and feel really good about this first property. Already starting to think about the next one!

@Amy Webber, @Andrew Emery, @Andrew Johnson, @Bob B., @Christopher Meis, @Cody L., @Dave Charlton, @Kevin Coggins, @Kevin Coleman, @Jack Clough, @James Slaughter, @Jonathan Jewell, @Lesley Resnick, @Miniece Richardson, @Robert Bohigian, @Russell Brazil, @Account Closed, as promised I've returned to this thread to provide an update. The seller agreed to pay for a structural engineer. As it turns out, the garage slab was not poured over the house foundation on the left side of the garage. As a result, the poor compaction of the soils on the left side led to severe settlement of the garage slab. The right side of the slab did not settle because it was built over the house foundation. However, the severe rotation of the garage slab (from the settlement on the left side) caused the horizontal crack along the garage (where it is attached to the foundation on the right side).

The garage slab settlement has not damaged the structure of the house. However, the settlement needs to be repaired and the slab re-leveled (as much as possible). The engineer recommending using structural foam or pressured grout, which is basically injected under the garage slab. I placed calls to 10 different foundation companies in the Atlanta area. Only two of them would provide a ballpark quote over the phone based on the engineer's report without seeing the property in person. One of those two companies straight up refuses to work with structural foam, and the other company strongly recommended against using foam as it's only a temporary fix. Both companies recommended the pressured grout, which may not provide as much lift as foam would, but it is basically a permanent fix guaranteed to prevent any further settling.

The quote from both foundation companies for the pressured grout was basically $4,000. The two quotes were very close. The seller agreed to provide a $4,000 credit to cover this cost. Since FNMA will not allow IPCs in excess of 2% of the purchase price, we went with a $1,700 closing cost credit + a reduction in the purchase price of $2,300. The closing happened today. I'll get the property hooked up with my property manager over the next couple days and then have the repair scheduled shortly thereafter.

Thank you everyone for your help and guidance!

@William C., the agent is representing both of us. I was going to wait for the results before I updated this thread, but the seller did agree to have an engineer inspect the foundation at their expense. Since they were agreeable to pay, I was agreeable to let them choose the vendor. At this point, we are waiting for the results and will take it from there. Probably both of us have our fingers crossed it's nothing major. In speaking with my property management company, many times it's not super expensive to correct something like this on a crawlspace foundation. Anyway, I'll be sure to let everyone know what the end result turned out to be - especially since you were all so kind to take the time to provide your feedback!

@William C., it's basically the state's standard agreement that was used. I did not write the contract. The seller has agreed to a 7-day extension. They need some time to review the inspection and decide what they're going to do. In the meantime I did speak with my property management company as others have recommended and was given some solid advice, similar to a lot of advice I already received here, but not too much more they can do.

I'll see what the seller comes back to me with, but I'd like to start with an engineer's inspection to have a professional opinion on what is needed to cure, and then have the seller make the fix or renegotiate the price and I will handle the repair.

I'll let you know how it plays out. I appreciate everyone's thoughts/guidance over the past 24 hours. Thank you all!

@Cody L., @Andrew Emery, @Dave Charlton, @Lesley Resnick, @James Slaughter, @Miniece Richardson, thanks so much for all your feedback and suggestions. It is very helpful. At this point, I'm waiting to hear back from the seller.

@William C., the contract states I have the option to terminate the agreement without penalty by providing notice to the seller of the material defect within 5 days of receipt of the inspection report, but no later than 20 days from the binding agreement date. The binding agreement date was 5/31. Therefore, if I can't come to an agreement with the seller today, and the seller doesn't want to extend my inspection contingency date, then I'm 99.9% sure I'm walking away from this deal altogether before end-of-business today so I can at least get my EMD returned.

@Christopher Meis, thanks a lot. All good feedback! I'll know more tomorrow and will update this thread. 

@Christopher Meis, those are some really great suggestions. Thanks! I don't know how deep the footings go down. This is a crawlspace foundation. 

@Andrew Johnson, if the property was listed, then I would agree with you 1,000% and would have passed on it completely. I meant to say this earlier and forgot to, but this is an off-market sale so the vast majority of people don't know it's for sale. The last time it was listed on MLS was back in 2010.

@Bob B., I agree with that and it's a good point. I doubt I'll move forward with this property if the seller won't pay for an engineer. If they do, and the repair cost is going to be significant, at that point I still wouldn't move forward with this property unless we renegotiated the purchase price to offset the cost of the repair.

Thanks for your recommendation of asking the property manager to check it out for me. I hadn't thought about that yet, only because this is my 1st property and I technically don't have a relationship with them yet. But I would assume they would still be willing to make a trip to the property for me, if they really want my business.

@Bob B., it's under contract for $89K and the current tenant is paying $884/mo. I'll be using Excalibur for property management. Are you familiar with them? Do you have any recommendations? Thanks!