Re: Property Tax Confusion Post


Old 08-19-06, 11:48 AM
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Join Date: Feb 2006
Posts: 5
Re: Property Tax Confusion Post

Another question related to my post about property taxes. The property (see Property Tax Confusion) has been inspected for termite and wood rot and the cost to cure averages $80,000.00 (range is $40K to $110K) according to several bids by contractors. The loan we are obtaining doesn't demand Section 1 findings be cured, although I could get a better loan if the house were brought up to FHA standards. Since the seller is usually responsible for any pre-sale repairs, I think that at least 2/3 of the cost to repair should be taken into consideration when I determine what my offer to them is for their shares. Whether that amount should be taken off their asking price, or some other method of compensating me, I don't know. Do you have any ideas about this issue?
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Old 08-21-06, 11:31 AM
Join Date: Jun 2006
Location: USA
Posts: 110
Some fairly obvious stuff here, but:

A piece of property is worth only what someone is willing to pay for it. A property not in good condition will generally be "worth" (more or less) its [undamaged fair market value] minus {cost to repair}. It's up to the potential buyer to make an informed and accurate estimate of what that sum is. The potential buyer must also take into account such factors as:

Do I want this particular property enough to pay more?
Do I think the seller might be willing to take less?
Am I competing with other potential buyers who might offer more?

You are certainly free to use your knowledge of the condition of the property to try to negotiate a lower price. But the seller(s) are equally free to refuse your offer and seek buyers elsewhere, or simply not sell at all at this time.

No one is going to "compensate" you for damage to a property you purchase, as long as you were aware of the damage beforehand.
Old 08-22-06, 10:41 AM
Join Date: Sep 2005
Location: Where the cows roam, CA
Posts: 2,204
I do believe FHA has another type of loan you can do. It's a 203K which repairs can be done after close but it's a longer procedure and I'm not sure a lot of lenders offer this program but it does exist. I haven't processed a 203K for 5 years or so!

Here's some info about it if you're curious:
Old 08-23-06, 01:44 AM
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Join Date: Feb 2006
Posts: 5
Re: Property Tax Confusion Post

Thanks for the replies; they are valuable and much appreciated. Whether of benefit to me or not, having the correct information is always a plus. Thanks again, CMGith

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