Buying a Home Sight Unseen
February 8, 2021
In the era of COVID-19, some real estate blogs report an increase in transactions where the buyer and seller negotiate the sale of a home without the buyer ever having set foot on the property.
Sometimes referred to as buying a house sight unseen, these transactions involve a participating FHA lender, the buyer, and a seller along with an FHA fee appraiser and other professionals typically associated with a home loan.
Housing market website Redfin.com reports that in 2020, almost two thirds of those who bought real estate in 2020 had not seen the property in person--that’s “the highest share since at least 2015, according to a Redfin-commissioned survey in November and December of more than 1,900 homebuyers across 32 major markets. That’s up from 32% a year earlier, and 45% in July, which was previously the high point.”
But the professional you absolutely must never do without in a situation like this? A qualified and experienced home inspector to perform the process known in the industry as a home inspection.
The home inspection is NOT the appraisal. The appraisal is nowhere close to an inspection and anytime you purchase a home without an inspection you take a gamble on finding a serious, undiscovered issue with the home only after you have closed the loan and moved in.
And this is a situation that happens more commonly than you might think. We get reader questions all the time asking, "I bought a home and soon after I moved in we discovered a leak in the roof” or “After we moved in we discovered problems with our foundation."
When we ask “Did you pay for the optional home inspection or did you rely on the appraisal alone even though the FHA and HUD warn you not to?”
The answer is very commonly, “We didn’t pay for the optional home inspection.” And the reason they are angry about their homes now has EVERYTHING to do with the failure to have the property inspected before agreeing to (or as a condition of) purchasing the home.
No matter HOW you choose to buy a property--with no in person walk through or with an in-person tour of the property--the home inspection is a crucial part of the purchasing process. The FHA and HUD warn borrowers never to purchase a house sight unseen by a home inspector.
You may personally choose to buy the home sight unseen; this makes the home inspection even more important. The same way people should never purchase a car without test driving it first? That’s how important the home inspection is.
If you need to be one this year’s version of the some 63% of people who bought real estate last year without personally visiting it, you’ll definitely need to get familiar with the home inspection service providers in your area and book your inspection as early as possible.
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RELATED VIDEOS:
Understand the Reasons for Private Mortgage Insurance
Carefully Read Your Closing Disclosure
Buying a Home With a Co-Borrower
Sometimes referred to as buying a house sight unseen, these transactions involve a participating FHA lender, the buyer, and a seller along with an FHA fee appraiser and other professionals typically associated with a home loan.
Housing market website Redfin.com reports that in 2020, almost two thirds of those who bought real estate in 2020 had not seen the property in person--that’s “the highest share since at least 2015, according to a Redfin-commissioned survey in November and December of more than 1,900 homebuyers across 32 major markets. That’s up from 32% a year earlier, and 45% in July, which was previously the high point.”
But the professional you absolutely must never do without in a situation like this? A qualified and experienced home inspector to perform the process known in the industry as a home inspection.
The home inspection is NOT the appraisal. The appraisal is nowhere close to an inspection and anytime you purchase a home without an inspection you take a gamble on finding a serious, undiscovered issue with the home only after you have closed the loan and moved in.
And this is a situation that happens more commonly than you might think. We get reader questions all the time asking, "I bought a home and soon after I moved in we discovered a leak in the roof” or “After we moved in we discovered problems with our foundation."
When we ask “Did you pay for the optional home inspection or did you rely on the appraisal alone even though the FHA and HUD warn you not to?”
The answer is very commonly, “We didn’t pay for the optional home inspection.” And the reason they are angry about their homes now has EVERYTHING to do with the failure to have the property inspected before agreeing to (or as a condition of) purchasing the home.
No matter HOW you choose to buy a property--with no in person walk through or with an in-person tour of the property--the home inspection is a crucial part of the purchasing process. The FHA and HUD warn borrowers never to purchase a house sight unseen by a home inspector.
You may personally choose to buy the home sight unseen; this makes the home inspection even more important. The same way people should never purchase a car without test driving it first? That’s how important the home inspection is.
If you need to be one this year’s version of the some 63% of people who bought real estate last year without personally visiting it, you’ll definitely need to get familiar with the home inspection service providers in your area and book your inspection as early as possible.
------------------------------
RELATED VIDEOS:
Understand the Reasons for Private Mortgage Insurance
Carefully Read Your Closing Disclosure
Buying a Home With a Co-Borrower
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