Have you ever seen such a great deal that you could not resist buying it? Do you want a great deal on a house? The exact style you want, the correct color, everything the family loves, almost brand new and the price is unbelievably great.
I just bought a sparkling cub cadet lawnmower for a killer price. It is one year old, self-propelled, mulches, every new feature, and I think you get the idea. It was just like buying a house in this down market. Great deal, clean and neat, right color, big, sparkles. Well not everything is as it seems all the time. Sometimes there is a reason for the low price that is not as obvious to the untrained eye.
As a full time investor I look at lots of houses. I look at hundreds of homes. I have heard just about every story and seen most types of sellers’ peddling their houses. The Georgia Real Estate market I know but lawnmowers I do not know. Do not get confused this story has a point.
The shiny, new looking, bright yellow lawnmower I got such a great deal on does not work. Why doesn’t my great deal look so great now? Well, let me tell you. I drained the gas, put in new gas, looked at replacing the spark plug, and looked at the air filter to see if it was clogged. Next I took the top of the case off to check the magnetos and electrical connections. I turned my lawn mowing machine over to see if it was bound up or hung up, then pulled on the rope starter 75 times until I was out of breath and my arm hurt.
Nothing worked and I thought maybe I just got taken. Well as an investor, and buyer of Real Estate in Georgia, I have learned to always have a way out or exit strategy. Never buy any home at such a high price that you cannot sell it as a fixer upper and get out of the deal if you do not want to keep the house.
I thought with this lawnmower project I had the secret weapon…. I could not go wrong. If I could not get it to run quickly my son could he is and engineer, a forensic engineer to be exact. He can fix anything given enough time. He was coming home and I would get him to look at this little project of mine. I have seen him modify a Mecedes Benz, completely rebuild a 7.3 liter diesel engine, change out a truck rear end and transmission, and rebuild an entire F250 truck. He even made a car rotisserie for a car repair shop once and custom designed and built scales for a race car driver that runs around the Atlanta Motor Speedway. This little lawnmower problem I thought if I can’t make it work he can.
We spent his birthday working on my little lawnmower project. He got it started but it would not stay running. He took it and the carburetor apart. It needs parts. It needs a new carburetor. The ethanol gas had rotted and clogged it up. My secret weapon had done his part, but now I need to spend some big money to replace the problem parts. My great deal is now a deal with a lot of work invested, a lot of time invested and extra expenses. So much for my story, here is the conclusion.
Buying a HUD home could be a great deal. Let the buyer beware. Just remember, a foreclosed home is often a neglected home. If the home owner who lost it, could not pay the monthly note, how could they afford the upkeep and maintenance? Bank owned usually means no one bought the house at the foreclosure auction. Low cost may mean the copper pipes are gone and the septic tank is plugged or broken.
You may get a fixer upper house or you may just help stimulate the economy by buying a home for too much money and spend days, months, or years before you can live in it or sell it for a fair price. You may be the lucky one and get a great deal and it is “move in” ready with no problems. Do not hold your breath for this deal.
If you need a good deal on a home now, there are places to look and deals already on the books. A O Home Solutions has a list of home owner and investor deals already under contract. Most of these homes come with a home warranty and a warranty deed. The HUD homes I have seen come with a limited warranty deed and no home warranty.
You now get to decide on the possible yellow lemon deal or a safe and sound deal? See your safe choices at www.sellorbuyhouses.com
Mon, Jan 30, 2012
Houses for Sale, Life and Family, Real Estate Investing