Do yourself a big favor when you start buying fixer upper houses. Pay for a home inspection before you sign the paperwork. Unless you are a certified contractor, you won’t be able to look beyond the cosmetics of a handyman special to see hidden damage. There could be all kinds of problems like termites, structural damage, water leakage and even dry rot in the support beams of a home. Little things like these overlooked when you purchase fixer upper houses, can lead to big money lost in the future.

Imagine looking through a potential handyman special on a dry and sunny day. The house looks a little worn down, in need of paint, floors, windows etc. but on the whole it’s not going to cost you a lot of money to get the property fixed. Then, about three weeks into the rehab you get a few day’s worth of heavy rain. Suddenly you find out the basement leaks, and not just leaks, but actually floods! That’s going to cost a lot of money to fix. Money that you didn’t place in the budget when looking at this particular rehab property. Money that is going to eat into your profits.

Home Inspections and Mortgage Companies

Many mortgage companies usually require that the home be inspected before they release funds for the purchase of said property. So, the homeowner or the homebuyer will have to pay around $400 for an inspection of the property. This may seem like a hassle, but in the long run can potentially save the buyer thousands of dollars, disappointment and lots of hassle.

However, a home inspection is not necessarily required for the real estate investor. They may be paying in cash or with a private hard money loan from other investors. Yet, I strongly advise shelling out the $400 for a home inspection even if it isn’t required on your fixer upper houses. In order to create a proper budget ensuring profits in the sale of your handyman special, you’ll need to know everything that is wrong with the property!

Before the Home Inspection on Your Fixer Upper Houses

If the homeowner of your potential handyman special offers to bring in and pay for the home inspector, make sure you both agree on and pick an outside party. In fact it would be best if you got permission to pick your own home inspector and pay for the inspection yourself. Many kinds of real estate fraud have relied on the use of a fake home inspection or appraisal to lure in a buyer, such as yourself.

If the homeowner refuses to allow your hand picked home inspector to look over the property you might as well walk away from the deal. Something is either wrong with the property or the homeowner is just going to be difficult throughout the deal and it’s not worth it to bother.

You’ll also, of course, want to let the homeowner know when the home inspection is after you’ve made the appointment. Also, be sure to tell the homeowner if you plan on being present for the inspection too. You may also want to pass along any instructions the home inspector gives concerning preparation. He or she will want to be able to look into every area of the home and along the walls. So, the homeowner should be sure to clear out blocked areas and clean out closets for the inspector’s visit.

What Happens During a Home Inspection?

When you bring in a home inspector to look over any fixer upper houses, you are allowed to be present during the inspection. The homeowners are also allowed to be present, so the both of you will know exactly what is going on with the property.

You are allowed speak with the inspector about various aspects of the property. Ask him or her any questions you may have about the structure, exterior, roof and so on. They will answer your questions and point out any extra damage or deficient areas that have been over looked.

The home inspector will look over the property from the top to the bottom and from outside to the inside. They’ll want to go up into the attic to inspect the roofing and make sure there aren’t potential leaks, mold, and pests and so on. Then the inspector will work their way down through the house going from room to room performing a visual inspection of the property. Finally, they’ll check out the basement, looking for cracks in the foundation, leaks, signs of water damage, settling of the building, and pests.

You can take notes as the inspector points out problems with the fixer upper houses, but he or she will be marking off a checklist of their own and making their own notes to give you at the end of the inspection.

A home inspection is an excellent way to ensure your handyman special won’t come with any extra surprises. It’s relatively cheap and quick, and will save thousands of dollars in the long run on your fixer upper houses.