Avoid Financial Mistakes When Buying a Fixer-upper Home

Dec 6, 2011
Clarice Cook

Low hanging tree branches can damage roofs - Image by Clarice Cook

A thorough inspection process of the roof and foundation can eliminate many financial hardships when buying a foreclosed home, or one need of repair.

Rule One: Never buy any home without inspection. What may be a basic great deal could turn out to be a money pit. Check first the obvious problems.

Inspecting any property, especially a foreclosed or depressed property can be confusing. It is recommended to invest in a professional who can spot trouble that a layman may not notice. However, a potential buyer can detect many problems by observing each component of the house starting from the roof and ending in the foundation.

Bill Zehner of the Kalamazoo Michigan O'Brien Real Estate Agency suggest “take into account the roof and foundation of the house. Everything else is a relatively inexpensive and easy fix, but roofs can cost tens of thousands to replace and to repair the damage caused by their neglect, and foundations...well the sky is the limit!”

The Roof

The Realtor will have information on when the roof was replaced. Depending on the materials used, most roofs will be good for twenty years or more.

According to CVH Roofing.com - How to Inspect Your Roof, a homeowner or potential homeowner should stand on the outside and walk around the house with binoculars and look at the roof.

Look for broken, crumbly or missing material, especially in low slopes’ around chimneys, vents or peaks where snow or wind damage can cause leaks. Are there dark patches? Do the shingles lay flat or do they curl or buckle?
Look at the edges of the roof lines to see if there are many layers of roofing. Many times, roofing is added rather than removed. This is not always a problem, but if there are too many layers, it might indicate a cover up of trouble beneath.
Are there rotting boards supporting the roof or signs of rot anywhere? Sagging or dips may indicate deterioration of supporting beams or supports beneath the roofing materials.
Check for open nail holes, loose or damaged flashing around chimneys and vents, and dried up, crumbling or missing caulking.

Inside the house, check ceilings, walls and joined wall board for water damage. Peeling, flaking, circling stains, and falling plaster may indicate possible roof damage.

If the attic is accessible, check beams and dark circles any where in the wood structure. Look for mildew, rot, blocked soffit areas, rusting metal, or vents that are installed into the attic instead of to the outside of the house.

The Foundation

According to Power Jack Foundation, Warning Signs of Foundation Problems, a potential buyer should walk around the perimeter of the home and check for the following problems.

Are there any trees close by with tell tale roots bulging up near the house foundation?
Are basement walls bulging or cracking from the outside?
Are there any puddles of standing water?

Check around the outside for signs of termite hills or “flying ants”. Look for rotting wood.

Inside the house, are there cracks in the walls, uneven and ill fitting doors and windows. In the basement are the cement walls cracked. If the basement is finished, do the walls have cracks or signs of water damage, mold or mildew. Check the wood support beams on the outside perimeter. Are there signs of deteriorating wood anywhere beneath the top floor?

Calculate the Cost

Research online and with local contractors to estimate the cost to fix any problems. Add that cost to the price of the home.

Compare that calculation to the price of other homes selling in the area.

If the total does not allow for other important potential repairs such as electrical and plumbing, and you still want the property, it might be possible to negotiate for a selling price that will allow for all repairs

Homes sold at short sale or foreclosed through the bank may already be at a rock bottom. However, if repairing the property will send the cost too high and if the seller is not willing to make a deal, walk away and look for another property.