It is common to come across the phrase “as is” when looking at real estate listings. It’s a term that may evoke two different visions. One is a money pit that any sensible person would have knocked down and started over. The other is fantasies of buying a diamond in the rough and turning it into a smart investment. Buyers may even alternate between the two scenarios on a day-by-day basis.
Tips for navigating it
Here are some helpful strategies for those who see a real estate listing or contract with the words “as is” in it:
- The property may be fine: It is best to be suspicious whenever a real estate deal seems too good to be true, but it really may be a matter of the seller saying that they will do no work on the property to close the deal.
- Inspections are helpful: While you can’t ask for repairs, it is still useful to hire an inspector (be wary if the seller won’t allow an inspection) to identify all the work necessary to make the place livable.
- Do the home inspection before making an offer: The seller may say “as is” and have a firm asking price, but the buyer should do their due diligence. The buyer can use the inspection to figure out the additional costs for that work. They can then determine a price they can afford by factoring in the fixes.
- You can walk away: There is no obligation to buy a property until you sign on the dotted line. You can even get your deposit back as long as you back out within the prearranged time frame.
- Don’t use it yourself: Sellers should avoid using the words “as is” because it scares away potential buyers. The seller is legally bound to disclose any serious problems with the property that they are aware of, and you may need to negotiate a price based on issues the buyer uncovers. Still, real estate agents and attorneys can help hammer out these details during negotiations.
Lawyers help protect your “as is” investment
Real estate lawyers can be invaluable when trying to close a real estate deal. This includes negotiating the price and recognizing potential problems that could be a much larger issue than they may appear at first. This may even mean walking away to avoid making the big mistake of buying that money pit.