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Walk away or no?
Hi ladies, I'm a long term lurker on this board, but first time poster.
FI and I have been house hunting for the past 6 months. We finally found our dream house! The house had been on the market for about 3 months when the seller lowered the asking price 10K. THis is when we decided to look at it. We put an offer in, and after lots of back-and-forth, the seller lowered the price another 15K. We had said that the roof is original (20 years) but it had a 30 year roof with 30 year shingles. We had expected to get at least 5 years out of it. Fastforward one week and we get the inspection. It needs a new roof because the granuals are off the shingles, the roof is lifting, and there is one small spot of water damage in the attic. We revised the contract asking for help with the roof and she could obtain estimates. Well she is saying no because she already lowered the price due to the original roof. Again, we thought we had 5 years,not tomorrow, to fix the roof.
I guess I'm asking (and also just venting) if we should walk away if she doesn't offer to do at least half? It will be a 8-10K job, which we just don't have the money to put down and to be comfortable with it... Its so hard to walk away. We love it so much!
Re: Walk away or no?
RIP Dr. Irving Fishman - 10/1/19-7/25/10 - thank you for holding on for me.
You made my wedding day complete.
Yah, I would go back and get the estimate of what it would cost to fix it. If she doesn't want to fix it, try to get her to give you seller's concession at closing. That way you will leave the closing with some cash in your pocket that you will be able to use for the roof fix. Remember add some 20% to the estimated price of the fix that you get - something always goes wrong and it may cost you a little more in the end.
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If you do not have an emergency fund in place after closing, moving and start up costs --I would question your financial readiness for home ownership.
You could easily wind up with other surprises after moving in.
(When are you getting married? I highly discourage couples buying a home while engaged, unless one of you can afford the mortgage on their own.)
I would walk away. If you know that there is water damage to the roof/attic area you should be careful. We are having our roof replaced and we already received our estimate - the same as yours. But, we were told that if there is damage (and we suspect that there is) that they can't know until they take the shingles off and look at the wood underneath It's $60 per panel. So, there is a small area of unknown there.
I only say walk away because you aren't comfortable with it financially and you never know if or what else could happen an if you do not have the money for the roof, you'd be in a bad position if anything else unexpected occurred.
I'm not sure anyone can get a mortgage on a home that needs a new roof. It will certainly affect the appraisal of the home. Has an appraisal been done yet?
If you have the money for the new roof and really love the house, your next step is to find out if the home is worth investing the extra money -- that's where the appraisal comes in.
The seller will have to decide whether she can get a higher offer than yours, knowing that whoever buys it will be facing the cost of an immediate roof job. It doesn't really matter if she already came down on her price. The only right price is the one that gets a buyer.
What does your real estate agent say?
WALK
You don't have the money. Walk away.
Houses are money pits (my opinion, after buying a fairly new, well-maintained house) - you don't want to start off on the short end of the stick.
As an additional advantage, showing the owner that you are indeed ready to walk will work in your favor if any further negotiations should take place.
Thanks for all the advice! We haven't had any formal estimates yet. I think the plan is that we'll get estimates and plan for the final price to be 20%+ of the quoted price. We'll ask the seller for half of the price or walk away if we have to.
Sisgual - we are getting married in April but for other reasons, we have it set up so that FI can afford mortgage on his own!
I am unaware of a statutory reference in my state that says you can be charged for selling a house with a roof leak (absent fraud which is not the issue here).
Anyway, the house is either worth it or not. Does the price reflect that the roof is older or was the price for a home that wasn't in need of imminent repairs? What's the market like? How desperate is the seller?
As for pricing, you need to look at comps in the area - what comparable homes are selling for (not homes that are still on the market). Your REA should do this for you. If the seller has already gone $10k, then another $15k under that threshold, then I don't blame them for not wanting to go any lower.
That said, ditto PP that if $8k is going to break you, you're not in a financial position to buy a house anyway.
DS1 born June 2008 | m/c at 9w March 2011 | DS2 born April 2012
I also think there's a difference between having an e-fund and having 8-10k on top of an e-fund to replace a roof.
I bought my house, I had an e-fund, but I can tell you there's no way I would have been able to put a new roof on my house AND pay for the other start up costs and still have money in the bank.
First, it's not illegal to sell a house with a leak, it's illegal not to disclose that. Second, a roof that needs work does not automatically mean it leaks, just that it needs work. So the sellers could sell to someone else with the roof needing replacement as long as it was disclosed.
I think getting estimates is good, but also having the sellers look into getting the roof replaced under their current home owners insurance. Many roof issues are from hail or wind damage and lots of roofing companies can submit to the homeowners so you only pay the deductible. Maybe you could just come down their deductible amount and they would do that - like $1,000 to $1,500.
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