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Let's face facts...buying a foreclosure isnt exactly a simply process. In fact, some would say the entire process sucks.

But, it can actually be even worse than you thought originally for your client without recognizing these 10 simple red flags. Knowing what to look for can save your clients thousands of dollars in the long run...

1. Air Quality: The air quality inside will tell you a lot about the over-all condition of the home. Musty or dirty smells can mean mold and mildew has developed. Perhaps a water leak...perhaps a leaky roof. Make sure you include air and surface testing in your home inspection. Yes, it costs money. But, that is a few hundred dollars well spent.

2. Peeling, bubbling or discolored paint: 9 times out of 10 this is caused by moisture...moisture that can cause mold. Swelling in walls or ceilings or a musty odor immediately point to water damage. Make sure you check the major surfaces in all areas around the kitchen and bathroom and UNDER these same rooms as well.

3. Missing sinks or other fixtures: We have all seen the news stories of disgruntled home owners that have been foreclosed on tearing out kitchen cabinets, toilets, sinks, etc. Make sure that, if the home you are looking to buy is missing these things, that they were removed properly and not simply torn from the wall or floor. That is the difference between replacing a toilet and replacing a wall, a floor, some plumbing, and a toilet.

4. Unheated during the winter: If the home was winterized properly, you have nothing to worry about. But, if not...there is plenty to worry about. Without it, water in pipes can freeze cracking seals, cracking pipes (both inbound and outbound) and potentially causing major water damage. Check all water lines leading to and from water heaters and all fixtures and the drain lines leading to the main sewer line until it leaves the structure.

5. Fungus growth: Fungus requires water to grow. If you find mold, there was or is water there. However, water flows downhill. So, look for the source of the water above where you find the mold.

6. Blocked drains: Blocked pipes will cause any number of potential issues including a sewage backup. Make sure all of your drains work properly and toilets flush with no issues.

7. Older homes with lots of renovations: Check with the city. Hopefully, these major renovations are tracible by being able to pull permits for the work that was done. Many older homes had asbestos (either in the insulation or in the tiles used). Make sure that any disturbance to this type of material was handled by trained professionals and that they potential risk is eliminated.

8. Excessive painting: Any "fresh" paint is subject to inspection. Especially if they felt the need to paint the molding, doors, even the wood floors. This is one of the main ways that people try to cover up the existence of mold. Out of sight, out of mind, right?

9. Discolored subflooring: When you are inspecting the basement, make sure you look up. Check out the subfloor above your head. Make sure you look for any evidence of discoloration or darkening stain residue. Also, look for holes in the subflooring that moisture could gather and create potential hazards later. Inspect those well to ensure they are dry and dont contain mold already.

10. Dingy walls or black cobwebs: If the walls have a dingy grey film on them or the light fixtures have a thin black cobweb-type appearance, you may be dealing with soot damage. Soot damage would be from several potential sources: a previous fire; a plugged chimeny associated with a wood stove; maybe even a malfunctioning furnace. Have your chimneys professionally cleaned and make sure that the furnace is tested by people that know what they are doing.

Yeah, you can get a great deal on a foreclosed home. But, knowing what to look for when in the buying process is the difference between getting a great deal...and buying a money pit.

 

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I wear blue jeans and casual shoes that are made of cloth and can go in the washer.  To some people, they may think I lack professionalism but if they could encounter what I encounter, as we never know what treasure we will find when we open a door, it will all be forgiven.  Walk a mile in my shoes and learn what to wear (and what you will may encounter) while shopping what is termed "Distressed Property" (REO, Foreclosures, Short Sales.)

From tip toe-ing through pigeon turds & cockroach carcasses and breathing in mold in between (let's not forget elements too) here is a guide on what to wear when searching for an REO or short sale:

Don't bring children if you don't have to!  It would mortify me if brown bear or blannie touched the floor in some of these homes - and I am not the best housekeeper in the world.

Dress for the Elements!  Make sure you are dressing appropriate for the weather.  Distressed property may lack heating or air conditioning.  I would say it is socially acceptable to wear shorts and tank tops in the summer for now while searching for homes.  Bring water in your car to stay hydrated.  In the winter, even though we don't see severely cold winters, make sure you layer up with sweaters and extra pairs of socks.

Be aware of potentially hazardous situations (while this isn't "the norm":)

Squatters:  This does not happen as frequently as it used to.  For the most part, with the market being extremely hot and homes receiving multiple offers + list agent checks and weekly preservation checks, odds of running into a squatter are a little less what they were even a year ago!  Active listings are generally getting multiple visits per day. 

Smells:  Sometimes smells in vacant homes can be overwhelming.  Many times it is due to the fact that someone used the toilet when the water is off.

Mold:  Persons highly allergic to mold should bring face masks when looking at homes to avoid breathing in mold spores. 

Pests:  If cockroaches bug you, you shouldn't be living in Las Vegas!  Many times pest control has been called in after the foreclosure so usually there are just dead bugs everywhere.

Water Damage:  Wear non-skid comfortable shoes. 

Lights Out:  It isn't safe to look by flashlight in homes that do not have electricity.  It is important to schedule appointments during daylight hours.

Trash:  I see it a lot pre-list but now agents are doing a better job at cleaning out their properties but it is still possible (although more rare) to find personal belongings in REO properties.  You will run into trash if you are looking at short sales.  Sometimes the property hasn't been cleaned in years.  There are some that I wonder if they were ever cleaned since they were built.

Green Pools:  Stagnant water sources breed diseases and most notably become a great breeding ground for mosquitos that could bring a concern for West Nile Virus.

More than ever, it is important to work with real estate professionals who know this market to help spot potential hazards because you never know what is hiding behind that closed door!  

 

  

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