If you know your home has foundation issues, but you're on the brink of selling, what should you do? For some, the answer is simple, but if you don't have the money to fix the foundation problems outright, or you have a long list of items to repair, it may not always be the first choice. Here's what you need to consider before you list your home.
Fixing The Foundation is Usually Best
There are a few reasons that fixing the foundation is usually the best route to go. First and foremost, it will be very difficult to find a buyer who is willing to pay the full market price if an inspection turns up foundation damage. Furthermore, once an appraisal is done, the home may not come back at the proper value to qualify for the loan. Once a bad appraisal is on the records, it can take more than six months to have a fresh appraisal done that brings it back up to value. Even if the damage is not significant, some home buyers will not stick around to find out. At the first signs of foundation damage, they will exit your home and never look back. So, fixing your foundation issues upfront is a really good way to get the highest number of fully qualified buyers bidding on your home, and ensure smooth sailing through the appraisal process.
If you're really unsure, the best thing to do is call in a foundation specialist ahead of time and have them do an assessment on the damage. They may come back and tell you that the damage is minor and will only cost a few hundred dollars to repair. This is the best-case scenario.
When to Sell As-Is
For some homeowners, the prospect of doing a major foundation repair is simply too costly. In fact, many homeowners feel that they are forced to sell when foundation damage becomes a hazard and it is no longer safe to live in the house, but they also can't fix it right away. In these cases, an as-is sale is better than nothing at all. Of course, many investors will swoop in trying to pick the house up for rock bottom prices so they can flip it for a profit. In other cases, buyers may ask for a concession for the repair out of the house of the price. This might be a good resolution if you want to get the most for your home but you don't have the cash to pay for the repair immediately. Again, if the buyer is interested in negotiating over the price to include the repair after they close, it is best if you have already had the foundation damage assessed by two or three companies. Coming to the table with quotes in hand will allow you to make a fair deal without giving up too much.
As mentioned above, if an appraisal or inspection mentions foundation damage, you may find that lenders do not want to lend on your home. In this case, the price you set will need to reflect the fact that only cash buyers will be able to come to the table.
As always, repairing foundation damage before it reaches the point of disaster is always best, but if you find yourself in a sticky situation with budget concerns and a need to move, it is possible to sell as-is. Just be prepared to take a slightly lower price for your home, and make sure you have accurate estimates on the repair cost from Allied Foundation so you can make the best negotiations possible.