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Old 02-27-2013, 06:37 AM
 
1,125 posts, read 1,337,455 times
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Default 1) Home (not REO or short sale) sold as is; 2) one name on mortgage pre-approval, two on deed

-Home is not a foreclosure or short sale, but an investment property (current owner bought it in August -- at forexclosure, I believe--for $270k, put some money into it and put it upf or sale shortly afterwards for $354k). Unusual? Pest inspection has been done and owner would fix any items shown on that, but otherwise would make no repairs, though agent says they'd "probably" fix anything a full home inspection we paid for brought up (e.g., problem with a/c). Is this unusual for investment properties? We're gun-shy about as-is proprties.

-Pre-qualification for mortgage has only my name on it, since I used only my income (wife's income is foreign income; she's a foreign citizen though has permanent residency status in the US). We do want both names on the deed. This wasn't mentioned as a problem when we pursued a short sale in another state last year (ended up backing out). Is this a problem because of California law, or maybe just this particular seller?
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Old 02-27-2013, 07:31 AM
 
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A home inspection is for your informational purposes only. It's to tell you what potential problems may or may not exist .Your choice to decide which ones you can live with.

No home seller has to fix anything that is found on a home inspection. All homes essentially sell "as is".
Don't anticipate having a home inspection done and handing a list of things to a home seller and expect them to fix every single that may show up on it. It doesn't work that way.

You not buying a new home, you're buying a used home. No home is perfect. Some things are trivial, some are major. Hopefully a home seller may be willing to fix any major problems or negotiate something to be done about it. But they don't have to. That's the chance you take when you make an offer and have inspections done. They are to inform you so you can make an informed decision whether to proceed or not. They are not binding on the seller.

As for the names on the deed. In a community property state such as CA, you and your spouse are one legal entity. She can be liable for your mortgage debt whether or nor she is on the deed. You also need to talk to your lender. A name on a deed gives one certain property rights to the property. The lender may not want to deal with some one not on the mortgage in case they have to foreclose.

You need to speak to both an attorney and your lender about who gets on the deed and the financial implications of that.
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Old 02-27-2013, 09:59 AM
 
Location: Mountain Ranch, CA The heart of Calaveras County
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Your spouse will be asked to sign an interspousal transfer deed at closing. This will result in her not being on record as an owner as far as the lender is concerned. After closing, grant her whatever interest in the property you want, via a quit claim deed.

While CA is a community property state, you will be the one on the hook for the loan and the original grant deed will say something like ABC, a married man as his sole and separate property.

In a purchase money mortgage in CA, the lender's sole recourse is against the property via foreclosure.
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Old 02-27-2013, 10:58 AM
 
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I have bought homes before, and realize that no seller is obligated to pay for repairs (other than perhaps to make the place habitable), but it's usually a matter of negotiation, with the inspection being for the buyer's information-- and they can then pay for any repairs themselves, negotiate with the seller for sharing of expenses or walk away. In this case, the seller has said in advance that they won't pay for any repairs.

Thanks for the tips on the deed, etc.

Not sure we'll pursue this particular place, but the info in the above posts would be useful in any other purchases, whether in California or even Oregon (other option).
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Old 02-27-2013, 11:03 AM
 
1,125 posts, read 1,337,455 times
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I have bought homes before, and realize that no seller is obligated to pay for repairs (other than perhaps to make the place habitable), but it's usually a matter of negotiation, with the inspection being for the buyer's information-- and they can then pay for any repairs themselves, negotiate with the seller for sharing of expenses or walk away. In this case, the seller has said in advance that they won't pay for any repairs.

Thanks for the tips on the deed, etc.

Not sure we'll pursue this particular place, but the info in the above posts would be useful in any other purchases, whether in California or even Oregon (other option).
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Old 02-27-2013, 11:25 AM
 
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The seller is obviously flipping the house. Bought it, put some money into it and is now reselling. Pretty common. The thought is to make a profit. Selling it " as is", means he's not really willing to put much more money into it than he already has.

That should not scare you off. Treat it as any other home purchase. As a seller he may not want to be nickel and dimed to death on minor items that could show up on a home inspection, like missing switch plate covers, staining a deck, additional insulation or a buyer who wants a storm door in addition to a regular entry door, etc. Some people think a home inspection entitles them to a fully renovated and remodeled home !

But any seller knows they have to basic mechanical systems have plumbing, heating, cooling ( if any),electrical in acceptable / decent shape or no one will buy the home.

If you're a serious buyer and not just kicking tires, the right house to buy is the one that suits your pocketbook and finances. Who owns it and their motivation in selling it is the least of your worries. Investor or regular seller, it really makes no difference.

If something really major comes up on a home inspection, even an investor will work with you .If it comes up on your home inspection, it's going to come up on any other home inspection too so sooner or later it has to be dealt with

Good luck.
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Old 02-27-2013, 01:38 PM
 
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I'd dig a little further about what repairs were done as well. I looked at a house that I was interested in that had been rehabbed and was done well. I thought the price point was a bit high, and found out they had done some repairs to the foundation... Which might have been fine, or been a continuing problem, so I walked.

Something to keep in mind when you buy in CA, with Prop 13, is you will always pay extra taxes for that bit of work the seller did. If you can find a home that costs less with just cosmetic issues, it's better to do it yourself and keep your tax basis lower.
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Old 02-28-2013, 09:31 AM
 
Location: Mountain Ranch, CA The heart of Calaveras County
6,032 posts, read 10,944,567 times
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Quote:
Originally Posted by Litlove71 View Post
Something to keep in mind when you buy in CA, with Prop 13, is you will always pay extra taxes for that bit of work the seller did. If you can find a home that costs less with just cosmetic issues, it's better to do it yourself and keep your tax basis lower.
What? Assessed valuations under Prop 13 are based on the sales price. If a seller pays for repairs in escrow, that value isn't added to the tax basis.
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