4 Cautions Of A Fixer Upper – Think You’ve Got What It Takes?

4 Cautions Of A Fixer Upper – Think You’ve Got What It Takes?

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4 Cautions Of A Fixer Upper

 

Do-it-yourself projects always seem easier on television, in stores or on the radio…

We even hear friends say that it was easy to do. But when was the last time you ripped down a wall for new cabinets, tore out plumbing for a new bathroom…?

How about building a roof, laying new carpet, remarciting a pool or even replacing your water heater or air conditioning unit…?

These common repairs found in most fixer-uppers in today’s marketplace…

And allocating enough money for repairs, inspections, permits and surprises in your adjusted repaired value price is crucial in buying a fixer-upper if you intend to make a profit…

First you must decide, “what can I can do myself “and what will need to be subcontracted out to certified plumbers or electricians, if needed.

So if you’re extraordinary with your hands, given the right permits, electric and plumbing can be done by yourself today (check with your local code enforcement agency)…

But the next question along that list do you have the time or resources to do the work. Sometimes it’s better to subcontract out the work and let the professionals handle the job…

Getting three to four bids usually is all it takes to be on your way.

 

 

 

 

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Getting an accurate cost of repairs for remodeling before making an offer is recommended…

“It is normally routine for conventional financing loans but for those dilapidated owner financing deals you’ll need an expert in home, termite and sometimes pools inspections to point out the work ”…

Built in inspection contingencies are the greatest asset to the buyer. But if you’re short on time, bringing a contractor along with you for a small fee accomplished the task just as good…

Always remember to cushion in approximately 10% of adjustments on repairs with or without that inspection…

Especially for structural work that might need experts from engineers to excavators on retainers…

These are big ticket items that can also set you back months costing you thousands later.

 

 

 

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From sweat equity partnerships to home equity loans, funding repairs for a project need the following to be successful. Make sure the deal contingent on getting approved for both loans if going for an equity loan. Also using programs, i.e., USDA or 203k loans will allow you to wrap the repairs inside the loan…

Always share the cost of repairs with the seller when purchasing your fixer-upper for a better deal, in the long run…

And finally the most important, make sure the comps are adjusted accordingly on your appraisals, broker price opinions or comparable market analysis…

Often overlooked and cost the buyer hundreds of dollars that could have financed a new bathroom or closing cost.

“And always consult your Realtor, Broker, inspector, attorney and handyman before making any major decisions”…

 

 

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About the Author: I’m Michael Kevorkian and I am a real estate broker and investor in the Chicago area. I own New Market Realty Inc. a residential real estate investment brokerage in the Wicker Park neighborhood.  My blog is here to help spread the word and love for real estate to all who care to know more. Realtors & investors alike, if it’s real estate and it’s good… You can bet I’ll get it on my website to share the awesomeness with you! You can follow me on , Twitter, and Facebook.

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