Inheritted home with long term tenants

Karen (name protected for privacy) inherited her biological father’s home in Lakeland. She was very blunt, and told us that her father was nothing more than biological, and she never had a relationship with him. He had passed away two months ago, he did not leave a will, and Karen was his only biological child. Karen lived in northern Georgia, and had no desire to travel all the way to Lakeland to see the mess of a house that was left to her.

Karen had a friend, who was local to Lakeland, drive by the house to take pictures. There were multiple inoperable cars in the front yard. Piles of trash almost covering up the view of the house, and people that Karen didn’t know sitting in the front yard. Karen told us that it was an absolute mess. All she wanted to do was sell it “as-is” and not deal with it, she wanted the money, but nothing else.

Karen had already filed the probate with an attorney to get the house from her father’s estate into her name. She had been contacted by hoards of investors, which is typical once probate is filed. It is public record, and many investors send marketing (mail, calls, texts) to the personal representative, or executor, of the probate case. She already had an offer on the table for $120,000, as is, paying all closing costs.

Realistically, that was a great offer. There was just one issue with it, the investor wanted a 15 day inspection period, and 30 days to close on the property.

When buying a property “as-is”, a 15 day inspection period means that the investor can “cancel” the contract within 15 days, and receive a FULL refund of their Earnest Money Deposit. As a seller, what that meant for Karen was that an investor could waste 15 days of her time, decide they didn’t want the property due to whatever reason, cancel the contract, and Karen would be back to square one.

Our offer to Karen was $97,000, closing in 21 days, with no inspection. This meant that as soon as we deposited our $3000 earnest money, if for any reason we canceled the contract, Karen would take our $3000 for wasting her time. We like to put our money where our mouth is.

Unfortunately, Karen did end up accepting the other investor’s offer at $120,000. We wished her well, and told her to reach out to us if she needed anything.

Fast forward two weeks later, we received a text from Karen asking if our offer of $97,000 was still valid. We told her as long as the home was in the same condition, yes. She explained that the investor at $120,000 asked for a price reduction on the last day of their inspection period. Not a small price reduction either, but a $30,000 price reduction due to the “condition” of the property. All of a sudden, their offer was $90,000, which made our offer of $97,000 more appealing.

Just a side note here for anyone with a property in similar condition to Karen’s - Investors are notorious for asking for price reductions on the last day of their inspection period. A higher offer amount is GREAT, but only if there is NO INSPECTION period. Don’t get fooled!

We spent the day going over our process with Karen, who was very grateful that we’d be able to close prior to the holidays. There was one last thing she forgot to mention to us - The house had two long term tenants that she knew of, and they’d come with the house. Karen said we’d need to evict them if we didn’t want them.

Side note: I’ll do everything in my power NOT to have to evict a tenant. Communication is key, and serving a tenant with eviction papers is the opposite of “communication”.

We were able to get their contact information, and ask them about their rental experience, and how much longer they wanted to stay. Turns out, they actually didn’t like the house very much. Karen’s father hadn’t done much maintenance for years, and things were falling apart. There were holes in the roof, when it rained outside, it rained inside. The home had electrical issues, outlets would spark when kitchen appliances were used. On top of all of that, the home had horrendous plumbing issues due to a collapsing main drain line.

When we asked the tenants if they wanted to say, they said NO! They had been there for two decades, and wanted out. We offered them cash for keys, and one month paid rent at their next house or apartment. They were extremely grateful and gladly accepted.

The tenant issue was solved, and two weeks later we closed on the house.

Karen got her $97,000 as promised, minus a code violation lien that had been applied to the house. Her net profit was just over $96,000.

On closing day, a registered notary went to Karen’s workplace during her lunch break. Karen provided her ID and a voided check to the notary, signed closing paperwork (about 12 pages in total), and the notary sent the paperwork to the title company handling the closing. By 4pm, Karen received her wire directly to her bank account. She texted me “thank you, I was so anxious throughout this entire process, but you made it easy, and most importantly, kept your word the entire time.”

We love making life easy for sellers like Karen. Although we had the lower offer to begin with, we were confident in our offer amount, and didn’t “change our mind” like the other investor did.

If you’re a seller and you have multiple offers from buyers, and the house is in “as is” condition….make sure to ask each investor if they are “waiving the inspection period”.... Also known as doing a “Zero Day Inspection”.

If your investor needs an inspection period…always ask why!