Tips For Wholesaling Homes With Termites
How big of a problem are termites for investors wholesaling homes, and what should be done about them?
Termites are just one of the many various pests and property issues that real estate investors come across when wholesaling properties. However, they are one which often causes a lot of fear and frustration.
Termites carry such a bad reputation because they can cause actual structural damage, whereas most issues that arise are normally purely cosmetic. This not only makes houses with termites a concern for buyers that intend to live in them, but also for home loan lenders that fear that their collateral may be compromised.
Obviously all home buyers, including those wholesaling homes ought to have home inspections done prior to purchasing. As a wholesaler even if you don’t plan to hold onto the property, or care how bad condition it is in, remember your end buyer will and 99% of the time they’ll have a home inspection done. You don’t want to be stuck with a property you can’t flip or see profit evaporate because you have to come out of pocket to fix it first.
Termites really freak out most retail buyers. They are immediately afraid of the worst; believing the property is about to fall to pieces or will costs them many thousands to repair. However, in many areas termites are pretty common. Go to south Florida and virtually all properties may have at some point or another had termites.
So before you panic or back out, first determine the type of issue and extent of it. Is it just a previous but now dormant infestation which has already been remedied, one which is possibly active but no major damage has been done or a live infestation that has been going on for years; there’s a huge difference.
In most cases properties can be simply tented and fogged. Sometimes just spot treatment is required just to be sure. Either of these options are relatively inexpensive and the seller can often be convinced to cover them.
So don’t automatically run from these homes, but know what you face.
If the issue is discovered after you buy and the home inspector didn’t pick it up you should have legal grounds to collect from them.
Similar strategy also applies to roofs and foundations in different parts of country. These properties can be huge profit makers with less competition, but they can bite back if you don’t do your homework.
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