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They accepted my offer on the as-is purchase, contingent on appraisal and inspection.
My realtor thought bank would have water turned on before inspection which is scheduled for Monday. REO wants 30 day close.
Realtor advised me this morning when I went to sign the contract that REO bank wants me to pay $250.00 to have antifreeze removed from pipes. Realtor said this would be conveyed in an addendum to the original contract. Is this SOP? Should the realtor have known?
The state of the plumbing and septic system are my main concerns, so I may be stuck. I will have to do it anyway if I buy the house.
Opinions? Once I agree to the "addendum" and sign the contract, can they come up with any more charges?
Am I being petty? The realtor was also surprised. REO bank has to approve plumber doing the work, which doesn't seem unreasonable. Its a small amount in the scheme of things, but I would like to avoid any more surprises.
I don't know if it is SOP, but it isn't that uncommon. We've had buyers have to pay to have a house unwinterized (and, if they don't close, then rewinterized), in order to do their inspection. We've also had buyers have to pay utility deposits in order to get the utilities turned on in the buyer's name for the few days for the inspection (HUD deals). If they aren't asking you to do that, you have come out ahead on that side.
If the utilities are currently off, the agent should have known to at least ask more questions earlier in the process, and should not have "assumed" anything. Now there may not be time to have everything on by Monday.
Bottom line, though, it sounds like you already assume you are going to have to do work on the plumbing. Are you going to close regardless of what the inspection finds? Or would the $250 be worth it for you to have the opportunity to back out if something really scary is found with the plumbing.
I don't know if it is SOP, but it isn't that uncommon. We've had buyers have to pay to have a house unwinterized (and, if they don't close, then rewinterized), in order to do their inspection. We've also had buyers have to pay utility deposits in order to get the utilities turned on in the buyer's name for the few days for the inspection (HUD deals). If they aren't asking you to do that, you have come out ahead on that side.
If the utilities are currently off, the agent should have known to at least ask more questions earlier in the process, and should not have "assumed" anything. Now there may not be time to have everything on by Monday.
Bottom line, though, it sounds like you already assume you are going to have to do work on the plumbing. Are you going to close regardless of what the inspection finds? Or would the $250 be worth it for you to have the opportunity to back out if something really scary is found with the plumbing.
Thanks for your quick reply. I just told my realtor to agree to pay. The electricity is on.
I'm not really worried about anything, but if I was, it would be the plumbing/septic. It would be worth the $250 to find out if there are major issues. I would rather pay to do that and skip the inspection, but I am too old to crawl under the house
The fact that it is an addition to the contract makes me think that both sides dropped the ball, but I am happy with my realtor. We will both be wiser next time.
Just be very aware that septics can be a major expense if it needs to be replaced. Also, have your realtor check with the state for the septic plan. My house was pre-the date of that law and no one had any clue as to where the septic might be found. We found it once the water was turned on and luckily there was no issue, other than having it pumped.
Not sure of the practices in your area, but here, a listing agent will often turn the utilities on in *their* name and pay any associated fees to pass inspection/appraisal & close the deal. Banks sometimes cut their own throats by insisting on low-commission deals. I guess it also depends on price-point, here a "cheap" house is $200k, so there's often a $5-$6k commission check waiting on a successful close.
Not sure of the practices in your area, but here, a listing agent will often turn the utilities on in *their* name and pay any associated fees to pass inspection/appraisal & close the deal. Banks sometimes cut their own throats by insisting on low-commission deals. I guess it also depends on price-point, here a "cheap" house is $200k, so there's often a $5-$6k commission check waiting on a successful close.
Thank you! I think your post may explain why this information was an addition to the original contract. My purchase is indeed "cheap". Neither the bank nor the agent want to incur the expense.
My home inspector says that part of the de-winterizing process is fixing any leaks. I know I am going to buy, so I don't mind paying.
Before you pay to have someone come out to "de-winterized", make sure that utilities can be turned on. A lot of foreclosed property also have their water shut off for non payment. The last foreclosed home I purchased, I had to request an extension for inspection since they couldn't de-winterized until the water is turned back on by the water company. I didn't have to pay for either but it did require an addendum to the original purchasing contract. I still closed on the original timeline but inspection timeline was pushed about 2 weeks back.
Before you pay to have someone come out to "de-winterized", make sure that utilities can be turned on. A lot of foreclosed property also have their water shut off for non payment. The last foreclosed home I purchased, I had to request an extension for inspection since they couldn't de-winterized until the water is turned back on by the water company. I didn't have to pay for either but it did require an addendum to the original purchasing contract. I still closed on the original timeline but inspection timeline was pushed about 2 weeks back.
I am not having the work done. I just have to pay for it at closing. The bank is arranging for the work to be done.
Why did it take two weeks to have the water turned on? or maybe it took that long to reschedule your inspection?
I think Zippyman has the answer. The bank doesn't want to pay for the work and neither does the agent since the profit is going to be small.
No problem. I trust the bank to get a reliable plumber since my only contingency is the inspection.
I hope I don't have to wait two weeks for the inspection even if we close on time. It was scheduled for today and I was looking forward to it.
Why did it take two weeks to have the water turned on? or maybe it took that long to reschedule your inspection?
Cause the bank needed to figure out what is needed to get water on.
Here is how it went for me.
Purchase contract signed with usual X days for inspection, mortgage, etc..
Agent and FNM knows it's winterized (cause they did it) so agent told me to wait for FNM to de-winterize the property before scheduling inspection. Fine... one week went by and no words. Mind you I already have my inspector waiting to schedule a date. Agent put request to field off for FNM. Still no words but now I am getting close to my inspection contingency timeline. I was not going to wait so I requested addendum to contract to extend the inspection timeline.
When a previous owners are deadbeats and have unpaid bills, the utility companies isn't going to just come out and turn the water back on with a snap of the fingers. They have to work out who is going to be responsible and even though FNM is selling the property, things are doing with their field service company.
If you are not scheduling the de-winterizing, don't worry about it.. Not your problem.. Just make sure you have enough time for your home inspection.
Cause the bank needed to figure out what is needed to get water on.
Here is how it went for me.
Purchase contract signed with usual X days for inspection, mortgage, etc..
Agent and FNM knows it's winterized (cause they did it) so agent told me to wait for FNM to de-winterize the property before scheduling inspection. Fine... one week went by and no words. Mind you I already have my inspector waiting to schedule a date. Agent put request to field off for FNM. Still no words but now I am getting close to my inspection contingency timeline. I was not going to wait so I requested addendum to contract to extend the inspection timeline.
When a previous owners are deadbeats and have unpaid bills, the utility companies isn't going to just come out and turn the water back on with a snap of the fingers. They have to work out who is going to be responsible and even though FNM is selling the property, things are doing with their field service company.
If you are not scheduling the de-winterizing, don't worry about it.. Not your problem.. Just make sure you have enough time for your home inspection.
Thank you. The bank has already set the closing date at Oct 1st or before, so I hope they will proceed in a timely manner. Financing already in place and home inspector seems amenable to working me in as soon as the bank says "go". I am trying to stay calm.
Can you explain this " Agent put request to field off for FNM" ? and perhaps clarify your last paragraph.
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