26 answers

Home Owners Please Help!

We are buying a house and are first time buyers. So what do we need to do? The man is owner financing bc we had a very bad period for a little while, but things got better. Do we need to have it inspected? There is a little work we have to do to make it how we want it, but nothing we cant get fixed soon.We are so scared and not sure. We think its to good to be true! He seems like a great man and has left us with all the appliances. He said he just had a renter move out back in feburary so they have had to do a few things, but nothing major! What should we do? After a couple days to think about it, we think its just because within the past 6 months we have had 3 people tell us we could get a house and then something happened! We are still going to get it inspected and appraised, but the strange feeling is gone. We are already excited about what we are going to do now. We have picked out colors to paint and flooring we want to change and so much, but we are putting some to the side for any repairs. Also we are going back over there in a couple days to look around again (like the 4th time) and we have a lot to get in order. I am contacting the county records office tomorow and an attorney. I am also contacting him again to ask a few more questions. I think he is a realtor, he has his own website and company through them on top of him working at a local company. He has sold a few houses in this area and a few other areas as well and I am going to see if I can find out who they are and ask if they had any problems (would the county office know that or could I get the information from someone?) I am also asking a few realty agencies if they have heard of him and if he is legit, bc he has been doing this awhile. Thanks everyone!

What can I do next?

Featured Answers

Always get a home inspection, paid for by you. Next, I would have a legally binding agreement drawn up by a lawyer for "owner financed homes." I did this when I first moved here. It is a contract stating basiclly that you are buying the home at $$$ payment for so many years. This protects you in case he dies or something else like that. Always have legal paperwork done, if he is not willing to do that then it is too good to be true. If the expense is what makes him balk, offer to split the lawyer bill. CB

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Yes. You need to get an inspection, it's well worth a couple of hundred $$, it could save you thousands. Depending on your area, you may also want to consider having termite and insect inspection (it's usually not included with the house inspection).

You also need to get a lawyer to review your contract. Read the contract carefully and make sure you understand it. Don't be afraid to ask questions.

Congratulations!

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I would get the house inspected, but also look into a home warranty for at least the first year. We got one when we moved into our old house and it worked out great because our washer machine broke in the first month.

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Hi there! I work in the real estate genre in KS, and ALWAYS get an inspection if you are putting cash down, especially 3-5% or more, you will save a lot of time and heartache! If you are only putting down the equivalent of a security deposit, there isn't as much risk to you, but you do want to make sure you look around and make sure you don't see any black mold, or fresh paint on ceilings, etc...

Make sure you use official contracts, not ones he types up. You can pick these up at any for sale by owner shops...

If you have an agent friend in area, have them check the history on property to see how long on market, any pending sales that were cancelled, etc. Cancelled pendings could be a sign of a bad inspection?

Make sure all terms are specified. How long will he owner finance and at what %? Will it balloon after 1,2, or 3 years? If so, you really need to make sure you are in the position to secure traditional financing, or he can raise your rate down the road. You may want to get it appraised too, as if he is asking too much for home, and down the road it doesn't appraise as high as he is asking for, you will not be able to get a traditional loan without bringing more cash to the table (which is a waste, unless this is your forever home). Find out who will get the tax deduction!

It is normal for him to charge a higher %'age on owner finance, as he is carrying the "risk" on the loan.

There is less negotiation with owners when they are carrying the loan, but he should make repairs to any significant items found to the home.

Check out FSBO sites, and there is a checklist I am sure that is more detailed that you can make sure your bases are covered.

But VERY much buyer beware. There could be a reason it hasn't sold with a traditional buyer? But also, the market is so tough, sellers have to get more creative to get a buyer sometimes too.

He may be nice, but get EVERYTHING is writing. Good luck!! =)

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you need to get the place inspected. That should also include an inspection of the fondation as well.You can not always see that the roof needs repair or past water damage to the house. The could also have dangerous wireing or plumbing problems just waiting to happen. I am concerned about the owner financing the house for you. you would need to hire a lawyer to look over the paper work and terms of the loan for you. The lawyer should also set up escrow services that include a title company. A title company would check to make sure theat the man does not have any tax or other leans or loans against the house. if the man has a loan against the house or a tax lean and you buy the house, you could be responsible for it.

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First, yes you need an formal inspection. You want to make sure you know what your getting. A good inspector will give you an idea how soon the major appliances, and roof will need to be replaced. Even if that is five years from now knowing so you can save and plan is helpful.

Second, you want to select a lawyer to review the paper work. Important -- You need to pick the lawyer, and the lawyer needs to be paid by you. The owner-financing guy holds all the cards. You could get scammed. You need someone who knows real estate law in your area to make sure it goes right, and that your rights are protected. A couple hundred dollars for you lawyer to review the deal and do the closing willl be well worth it. You'll be less scared if you do these two things.

Manson was a nice, well dressed man.

The sellers job is to make money and protect himself. You need to protect yourself. If he was so great you wouldn't be this scared. You gut is telling you something. Listen to it.

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A $200 inspection can save you a $50,000 problem later on.

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Yes, get it inspected. It can make all the difference in the world. I know a very reputable inspector in the Dallas area - I can see if he knows a company in your area to refer you to. Let me know if you want me to ask him. Good luck!

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Do not let the "owner Financing" get in the way of getting a quality house. The insurance company will make you get an inspection of the house and make sure that their "investment" as well as yours in sound before they will insure you.

Get the inspection, survey and everything else you would need as if you were using a traditional lender. This is your house and it should not even be a question. You need to know everything that you are getting into.

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Pay for the inspection by all means! This is protection for all involved and you really cannot tell many issues unless you are a pro (ie foundation, electrical and plumbing). It does not cost that much and it will provide helpful info at the very least and possibly save some serious trouble in the future. Good luck!

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Never buy a house without a house inspection. You could leave yourself open to so many problems you wouldn't believe. Make sure you check this guy out. If you have a gut feeling that it is too good to be true it usually is. Make sure the title is actually in his name and not someone elses and he is who he says he is. Good luck.

L.

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Absolutely you need an inspection AND an appraisal before you agree (in writing or not) to ANYTHING. If is sounds to good to be true it usually is, so please protect yourself. I think there are some free, state/federal agencies for homebuyers or talk to your bank even if they aren't financing for recommendations of inspectors and appraisers. It will cost money, but will be money well spent. You may want to talk to an attorney as well to review the contract before signing.
A home is a wonderful thing to own and feels like a real sense of accomplishment, but don't get roped into a money pit and a bad deal.

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Get the home inspection! Also in California, when you purchase a home you can buy a type of insurance yearly. It covers all the appliances in the house, including the water heaters, ac/heater, and more. It was like an extra 300 dollars a year, but totally worth it. We had to have our AC fixed right after we moved in, it only cost us a 55 dollar deductible because we have that insurance. If you want my companies name you can message me in private and I will look for it. Since its home owner financed you will probably have to purchase by yourself, or have the title holder purcahse it for you.
Also, you might want to either hire a realtor yourself, or find an escrow company to go through and pay the extra fee's. You need to find out if there's any property violations, illegal structures, fines, back taxes, leins, etc. It's a lot of work to do on your own, which is why having a realtor really helps, but it can be done on your own. Good Luck!

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Please make sure you go through an escrow company to make sure the mortgage is paid. The escrow company can go over figures for you to make sure what the owner said is correct. I say this because many owners have taken the money and run leaving the new owners in much debt. Also pay for an inspector to go over the house and give it the okay. If you feel that there is something not quite right up til you sign the documents, back out. Yes, you might loose a few bucks but it will not be a money pit. Remember there are other homes on the market. Just make sure that you know that home ownership is just not the mortgage and utilities it is also putting money aside for all the upcoming repairs that might "spring" up unannounced. So do run the figures. Good luck to you. The other S. and former realtor.

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Get someone to help you with this, do not rely on the seller!! If there is a lean of any kind they will come after you (if work was not paid for 10 years ago they can get that $$ from you). Go to a reality company. We bought our house from the owner, but used Residential mortgage firm to walk us through the paper work and be sure we had all the inspections and such that we need. I would be very worried about someone knowing your inability to get a main stream loan and taking advantage of you.

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Get a home inspection! The few hundred dollars is worth it more than some new paint or carpeting. And make sure the title is clear! Find a closing agent to look out for YOUR interests.

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I would never purchase a home without a reputable realtor. The seller doesn't have to have one, but you sure need one to protect your interests, especially since you've never purchased a home before. You are not out of pocket for the realtor's expenses, so it doesn't hurt you to have someone working on your behalf. And yes, you should get a home inspection anytime you buy a home, no matter how old or new the home is.

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HIRE A INSPECTOR!!! they check pipes,roofing,and all sorts of things that we have no idea about. termites...ah things can go VERY bad. always ALWAYS get an inspector.

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Always get a home inspection, paid for by you. Next, I would have a legally binding agreement drawn up by a lawyer for "owner financed homes." I did this when I first moved here. It is a contract stating basiclly that you are buying the home at $$$ payment for so many years. This protects you in case he dies or something else like that. Always have legal paperwork done, if he is not willing to do that then it is too good to be true. If the expense is what makes him balk, offer to split the lawyer bill. CB

1 mom found this helpful

Yes get it inspected, it is your responsibility as the buyer. The owner may not even know some of the things that could be wrong with the house and then it's all your problem. Also be careful with the owner doing the financing, there are all kinds of different ways to mortgage a house and alot of those have ungodly interest rates so be careful.

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You DEFINITELY need to get an inspection. There are lots of things that inspectors are trained to look for that you would not see on your own. Buyer beware, so do your homework on this one. It's way too big of a purchase to just trust him because he seems nice. I also am not sure what you mean by owner financing, but I would run everything by a lawyer to be sure it is on the up and up. They shouldn't charge you that much to run through the legal/financial paperwork with you, but it will be totally worth it to be sure you don't get into something you don't understand. Good luck! Sometimes if it sounds too good to be true, then it might be, so proceed with caution, but I hope it all works out for you and your family.

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I would have a termite inspection for sure. In Naples FL the contract specifically reads that if there are termites present - the SELLER shall have and pay for the treatment/removal and repairs of termites and their damage. How old is the home? If it is relatively new - and it hasn't been in any hurricanes etc.... and the roof is less than 10 years old - I would say if you need to save $ - don't pay to have that inspected unless you see something that is bothersome. As far as a "home inspection" - get some quotes - they vary wildly in our area. (price & what they include). You can kind of negotiate what you want to have inspected. There is no real science to how they check certain things and you could maybe do some of them yourself. 1) turn the stove on - do the burners work? 2) throw a thermometer in the oven and set it to 350 - come back and check it in 20 minutes or so - is it accurate? 3) Turn the sinks on, and look underneath while they are running hard. See any leaks? 4)Drop a little food coloring in the tank of the toilet and leave it for 1/2 hour or more. Is there color in the bowl? If so - there is a leak. Flush the toilets,.....any leaks when that happens? 5) Is the hot water hot? Has the water to the house been turned off? If so.....was the hot water heater unplugged - or left to boil dry and burn up? 6) Set the dishwasher and turn it on. Does it sound like it's running? After awhile - open the door - is everything in there wet - or is it just humid with a puddle in the bottom? Are there any leaks? Then - you can have an inspector - check the A/C, foundation & the attic for any obvious signs of leaks, infestation etc. Have them check the electrical and see what else they suggest and go from there.
Oh yea - and regarding the termite inspection. I don't know what your contract says - but in Naples it says "the buyer may at the buyers expense have the real property inspected for termites". SCAM. The termite companies ALL charge real estate BUYERS $75 - $100 for the inspection. A concerned HOMEOWNER can have an inspection for FREE! I called them out on it and was told "we have to file paperwork with the bank"....."Oh yea? There is no bank, it's owner financed"......"we have to file paperwork with the state"......."no you don't"........"we do it for homeowners for free BECAUSE if we find an infestation - we use the opportunity to bid the job" DING DING DING!!! Property in Florida can't be sold with an infestation - so if you inspect for a BUYER and the SELLER has to take care of any problems that are found....don't you think that you'll be bidding the job? I had 1 company tell me that they would come out and inspect for my buyers "this one time". From then on - I crossed out the "Buyer may at Buyer's expense" clause and wrote in "Seller to have termite inspection, and provide Buyer with a written copy of termite inspection within X# of days of effective date of the contract" "If termites or other wood destroying organisms are found - Seller to notify Buyer of intentions to treat property within X# of days and provide Buyer with receipt and proof of treatment prior to closing". If the SELLER does not treat the property and there is a live infestation - the buyer may or may not terminate the contract at their discretion and are entitled to all escrow $ that had been paid. GOOD LUCK!

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ALWAYS get an inspection when you purchase a house. You need to know if there is anything wrong (especially if it is major) that you will have to pay to correct.

You should also have a structural inspection done. I once was in the process of purchasing a home. I had an engineer do a structural inspection. There was damage that the homeowner did not want to fix. If I had not had the structural inspection done, I would never have known and it would have been so expensive to fix.

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First, yes, get an inspection.

Second, I suspect that this is one of those deals where you don't really "own" the house in the same context as those of us with a traditional mortgage are considered to be owners. I am sure that there are some things where you are fully liable. Those things would include homeowners' insurance and property taxes.

But, PLEASE BEWARE. You mention that you had "a very bad period for a while." Well, there is a business that exists. And that is people who are in the business of "selling" homes via owner financing to people in just such situations. They consider all previous "buyers" to have been renters, because that is essentially what they have been doing - plus paying insurance, taxes, repairs and maintenance on the property.

Be sure that you can afford all the things that are not typical in a rental situation - the mortgage, insurance, taxes, repairs and maintenance. Plus any utilities and water bills that you are not accustomed to paying.

The point is, there are people whose entire living is made of "selling" and then "foreclosing" on such properties repeatedly.

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From a realtor, you need an inspection and you need an attorney to draw up the papers to protect your interests.

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I don't like your comment that "he worked out the numbers." Please seek legal counsel and don't just go along with this guy. At a minimum hire an agent.

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Yes, get the house inspected. I don't think it matters how much you trust the guy. Once the house is yours, you are stuck with all the problems. You could be digging yourself in a major hole if you don't spend the $ for an inspection.

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