Real Estate Q&A: Protect Yourself, Especially When Buying Foreclosure FORT LAUDERDALE, Fla. – Sept. 20, 2013 – Question: We are buying a house from an investor that buys homes after foreclosure and fixes them up. Is there anything extra we need to do to protect ourselves? – Kay Answer: Yes. This is a popular investor strategy in South Florida and other areas hit hard by the housing crash. This can work out very well if it is properly done, resulting in a profit for the investor and a reasonably priced, newly upgraded home for you. You as the buyer, however, are smart to be extra-cautious, considering the dangers of both buying a foreclosed property and construction in general. You will need to carefully review the title insurance commitment to make sure that the foreclosure was performed and concluded properly and that all issues have been cleared up. You will need to go to the city and county and make sure that all permits were properly obtained and closed out, both from this renovation and from the previous owners. Make sure there are no code enforcement issues and that the homeowners’ association is paid up, and the renovations are in compliance with community guidelines. Pay particular attention if there are any additions to the house, making sure that they were permitted and are up to code. When the renovation is complete, ask for proof that all of the contractors and subcontractors were paid in full. Have the property inspected with extra care and detail by an experienced inspector, making sure that all of the renovations were properly done with quality materials and that no problems were just covered up. Watch for mold, because the home may have sat empty for months during the foreclosure. Speak to several neighbors about the history of the house. That can be a good way to find any potential problem areas. About the writer: Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program. The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction. Copyright © 2013 Sun Sentinel (Fort Lauderdale, Fla.). Distributed by MCT Information Services.
Posted on: Sat, 21 Sep 2013 16:34:24 +0000
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