Checklist For Cash Buyers
Here in Atlanta,Georgia when you are purchasing a home using a lender, much of the “investigation” is done on your behalf by your lender. Of course, if they are loaning you money on a home, the want to make sure they know as much about it as possible.
But, suppose you are a cash buyer. Who’s looking out for you? Well, your real estate broker can assist you to a certain extent based on law, but much of the due diligence now falls directly on YOU.
So, what should you be looking for? Here’s a list of items to keep in mind. Keep in mind that some of these may or may not apply, depending on whether you are purchasing a Single Family home or a condominium.
- Owner’s Title Insurance — This is MUST have, especially if you are buying a foreclosed or short sale property. This insurance does just what it says…protects you from any title issues that could come up in the future.
- Termite Inspection — May or may not be needed in a condo, but certainly in a house. This would be an issue in a condominium if it is a community that has ground floor units, is older or has significant wood in its construction. The homeowners association should have coverage for this, another thing you want to verify.
- Water Bills — Again, more for the single family home. A significant monthly bill could mean you have a leak, and it may be underground where you can’t see it. A costly repair later on if not found now.
- Flood Zone Determination — Again, for a condominium, this would be important if you are on a first or second floor, and there is any type of stream even remotely close to the community or your building. A flood in the Atlanta area this past year damaged homes that were NOT in a flood plain, and without insurance, the homeowners were not able to get insurance to pay for the damage.
- Hazard Insurance — In most real estate contracts, there is a clause that covers what happens to the property AND the contract should the home be damaged. But you want your own insurance coverage the moment you close on the property. If you were using a lender, this would of been covered as part of your loan payment, but not when you purchase with cash!
- Home Inspection– A must for ANY property, condo or single family home. Simply do not purchase a home without first having this done. Even new construction can have issues you may not see and an inspector will. Better to resolve before you buy than after.
- Appraisal– Just because you are paying cash does not mean you should not know exactly what the property is worth!! Another wise investment prior to your purchase to make sure you are not paying more than you should.
- Survey– Not necessary in a condominium, but a MUST in single family or multi-family homes. You want to know where the property lines are, and if there may be any easements that you are not aware of. (Just try to put in the new pool if there is a sewer line running through your back yard and you never knew it!)
- Homeowner’s Association– First, you want to know if one exists (single family) and then you want to know the rules and any membership fees there may be. Also, are those fees mandatory (for sure in a condominium, possible in a single family home) and how much are they and what do they cover. Are there any pending assessments from the Association that you could be responsible for? How stable is the association and do they have monies in reserve for bad debts, repairs, etc.
These are the major items you want to keep in mind if you are paying cash. If you have questions about your Atlanta Real Estate purchase, give me a call!