5 Tips on Buying a Foreclosure in Chester County
Filed under Buyers · Tagged: bank owned chester county, bank owned properties in downingtown, bank owned septic system, chester county foreclosure buying tips, chester county foreclosures, downingtown foreclosures, downingtown reos, failed septic system bank owned, phoeniville foreclosures, phoenixville foreclosures, phoenixville reo, reo and septic issues, reo chester county, reo failed septic, tips on buying a foreclosure, west chester pa bank owned, west chester pa foreclosures, west chester pa reo
Part II of the 5 Part Series, 5 Tips on Buying a Foreclosure in Chester County
It’s a bright spring day in Chester County, and my client and I are cruising through a quiet, well kept Thorndale neighborhood on our way to see the REO listing that is priced roughly $100k below the comparable homes around it.
Sounds good……a little too good.
As we approach the home, it looks like it needs a little TLC, but nothing too major. “It’s not as bad as I thought it might be,” I remark to my client. He nods his head in affirmation as we hop out of the car and make our way towards the front door. I fiddle with the lockbox for a few seconds, manage to extract the key, & then crack open the door. Immediatley I’m greeted by a pet odor that packs enough punch to make me take a few steps back wards before I can muster up the courage to move forward again.
As we head into the “living room” (I term I use lightly, since any living thing that enters this room certainly won’t stay that way for long), the carpet is matted with massive amounts of thick white fur. It’s easy to identify the corner of the room in which the poor dog had been trapped, abandoned for who knows how long.
There are holes kicked into the drywall every few feet, the heater is rusted out, the garage walls have sunlight streaking through them, and the hardwood floors are buckled from an obvious moisture problem coming up from the basement. As we head up to the second floor, I notice that most of the drywall on the ceiling is riddled with small, roughly-cut holes. “What do you think that’s all about?” I ask my client.
“Squirrels…..they somehow made their way into the attic and chewed through the drywall to get into the house.”
Not every foreclosure is a complete rehab. In fact, I sold one in Valley Township a few months ago that was in move-in condition, and another one in Glenn Mills that needed a little “sugarcoating,” but nothing too major. But my experience has taught me that if you are looking for a foreclosure, you better be prepared to roll your sleeves up and get a little dirty.
Be advised that if you are buying a foreclosure, you are buying it “AS IS.” What does that mean? It means you can do inspections until you’re blue in the face, but if there is a problem, the bank aint fixin’ it!
Here are some of the most common issues that I see with bank owned properties that any buyer should be aware of:
1. Watch Out for the Failed Septic System
Any Realtor will tell you that the single most expensive thing that can go wrong during the inspection period is for the septic system to fail. A new septic can cost anywhere from $7,000-$30,000+ (depending on how quickly, or how slowly the soil on the lot is able to drain water).
When a home goes through the foreclosure process, often times it lies vacant for several months before it is put on the market. Many people don’t realize that in order for a septic system to function properly, it needs to be used on a regular basis. It a home is vacant for more than 1 month, the septic inspection company will recommend that a hydraulic load test should be performed. This test costs approximately $850, and takes 2 days to complete. During the hydraulic load test, the system is flooded with massive amounts of water. The drain field is then probed to see how effectively the system is able to disperse the water.
If the septic system fails, you can try to negotiate some kind of concessions with the bank, but it is unlikely that they will give in.
Stay tuned for my next Post, “This Property Has Been Winterized”
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