Our Real Estate Blog

Jan. 29, 2020

Pre-Qualified vs. Pre-Approved: What’s the Difference?

Pre-qualification estimates how much you may be able to borrow, based on a mostly informal evaluation of your finances. Pre-approval carries more weight and requires documentation.

Pre-qualification and Pre-Approval sound similar, but typically only one Pre-Approval will put you ahead of the homebuying competition.

What is mortgage pre-qualification?

Generally in the pre-qualification phase, you describe your credit, debt, income and assets, although application processes vary by lender. Based on this overall financial picture, the lender estimates how much you may be able to borrow. Some lenders will also do a credit check. You can get pre-qualified over the phone, online or in person. Getting pre-qualified can give you a sense of your financial readiness and introduce you to various mortgage options. It’s often a good step for first-time home buyers who are just testing the waters and aren’t ready to jump in

What is a mortgage Pre-Approval?

A mortgage Pre-Approval takes the process to the next level. Pre-Approval requires you to provide proof of your financial history and stability. The lender will verify your income, employment, assets and debts, and will check your credit report. You’ll provide information in the form of W-2s, a current pay stub, a summary of your assets and your total monthly expenses, and if you already own real estate, a copy of your mortgage statement and home insurance policy.

If you satisfy the requirements, you’ll get a Pre-Approval letter, which states the amount and type of mortgage the lender is willing to offer, along with the terms. You can show the letter to sellers and their real estate agents when making offers on homes. A Pre-Approval offer isn’t a guarantee, but it shows you’re a serious buyer, which can give you leverage in a competitive market. 


Posted in Buying a Home
Jan. 22, 2020

Home Appraisals - What Buyers Need to Know

A home appraisal sometimes comes as a surprise to first-time home buyers. It may not be talked about as much as other parts of the home buying process, but it is an important step. The good news is, there’s not much home buyers have to do during home appraisals except wait. It’s still helpful to know why and how home appraisals happen, so you know how to react when you get the results.

What is a home appraisal?

A home appraisal is an unbiased evaluation of a property’s market value. Mortgage lenders require home appraisals to make sure they’re not giving a borrower a mortgage worth more than the house it’s meant to finance. If that happened, and the borrower ended up walking away from the home, they couldn’t make up for the loss by reselling it.

Who performs home appraisals?

Home appraisals are done by professional, certified real estate appraisers. They must be both trained in appraising homes and familiar with a local area to be able to work there. They also must have no relationship with anyone involved in the home purchase.

How does an appraiser determine a home’s market value?

Home appraisal isn’t an exact science, but appraisers use a lot of data to make as accurate an evaluation as possible. They evaluate the size, floor plan, and condition of the property, recent comparable sales in the neighborhood, as well as other factors that affect the market, such as recent infrastructure investments. Home appraisers also use public property records and other public documents to support their appraisal.

What does the buyer need to do?

Not much. The mortgage lender orders and schedules the appraisal. You’ll be busy scheduling your home inspection around the same time, so you’ll just want to be aware enough of the appraisal process to not schedule your inspection at the same time.

How could the results of an appraisal affect a home purchase?

If your appraisal comes in at or around the price in your purchase agreement, you’re in good shape. Mortgage lenders typically want to lend no more than 80 to 97 percent of the home value, so if your down payment is between 3 and 20 percent, you should be fine, depending on your mortgage lender’s exact rules. If your appraisal comes in higher than the price in your purchase agreement, congratulations. You and your real estate agent negotiated a great deal. If your appraisal comes in too low, that’s when things get a little tricky. If the seller agrees that the appraisal is fair, they may be open to negotiating a lower price. But if the appraisal is just a bit lower than the mortgage lender wants to see and you have put less than 20 percent down, they might ask the buyer to compromise and put down a larger down payment to make up for the portion of the purchase price the mortgage lender won’t finance.

What should a buyer do if they think their appraisal is wrong?

If an appraisal is so far off it threatens your home purchase, and you believe it’s due to an error, you can ask for a reevaluation. Home appraisers are human, and they do make mistakes. You have the right to see the appraisal report, which should be your first step if you think an error has been made. You can check through all the data the appraiser used to come up with their evaluation. If you see a major mistake, a reevaluation may be in order.


Posted in Buying a Home
Dec. 27, 2019

Understanding Escrow

In Escrow

In escrow is a temporary condition of an item, such as money or property, that has been transferred to a third party usually on behalf of a buyer and seller. In escrow is a type of legal holding account for items, which can't be released until predetermined conditions are satisfied. Typically, items are held in escrow until the process involving a financial transaction has been completed. Valuables held in escrow can include real estate, money, stocks, and securities.

Understanding In Escrow

Escrowed items are most commonly found in real estate transactions. Property, cash, and the title to the property are often held in escrow until all specified conditions, outlined in the escrow agreement, are met, and transfer of ownership can occur.

An escrow agreement outlines the conditions and terms between the parties involved in the transaction as well as the responsibilities of each of the parties. Items placed in escrow are managed by a trustee called an escrow agent. The escrow agent, which is typically a lawyer, holds the assets until predetermined contractual obligations are fulfilled. Once the agreement terms have been satisfied, the escrow agent releases the funds or property held in escrow to the appropriate party.


  • In escrow is a temporary condition of an item that has been transferred to a third party usually on behalf of a buyer and seller.
  • Valuables held in escrow can include real estate, money, stocks, and securities.
  • In escrow is often used in real estate transactions whereby property, cash, and the title are held in escrow until predetermined conditions are met.

Real Estate in Escrow

While property is held in escrow, the buyer cannot take possession of or occupy the space. Real estate deals must clear a series of stages during the escrow process. Below are some of the typical conditions that might need to be met and why assets might be held in escrow.


An appraisal of the property must be conducted on a property before its sale. Issues could arise if the appraised value of the property is lower than the agreed-upon purchase price. Banks will not lend money for the amount property if the asking price is above the appraised value. The buyer could try to find funding to cover the missing portion of the agreed purchase price for the property or ask the seller to lower the price. If the buyer can't fund the difference while the real estate is in escrow, the transaction could be terminated.

Home Inspection

A buyer might agree to purchase a property with the condition that the home passes a home inspection. The funds for the purchase would be held in escrow until the inspection has been completed. Once the conditions of the offer are satisfied, the buyer or seller will then be obligated to purchase or sell the property.

Financing and Insurance

The real estate transaction could be held in escrow whereby the sale wouldn't be completed until the buyer obtains financing or a mortgage from a bank. Also, the buyer could have difficulty securing the necessary insurance and other policies needed to complete the transaction. If the buyer doesn't get approved for the mortgage or obtain the needed insurance, the escrow agent would nullify the offer to buy.

Title Search

Before purchasing a home, a title search is performed, which is a process of checking public records to determine the ownership of the property. The title search helps determine if there are any liens and other claims attached to the property. An outstanding lien means that the property was used to guarantee the repayment of a loan. A clear title—meaning there are no liens—is required for any real estate transaction to go through properly.


The buyer may have wanted the property for a use that does not match current zoning regulations. The seller might seek a variance while the property is in escrow to allow the buyer to proceed with their intended plans upon taking full ownership of the real estate.


The purchase might have included guarantees that the seller would address needed repairs to the property. This could include the removal of landscape features such as trees or the reconstruction of part of a building. If the seller does not make good on those promises while the property is in escrow, then the deal might fall through.

The funds in a real estate transaction can be held in escrow even on the date of the sale and won't be released until all parties—the buyer, seller, and the mortgage company—agree that all of the conditions in the escrow agreement have been satisfied. The intention of keeping property in escrow is to assure all parties that the mutual responsibilities outlined in the escrow agreement will be fulfilled.

By JAMES CHEN Updated Aug 4, 2019

Dec. 19, 2019

What Are HOA Fees?

What Is a Homeowners Association Fee?

A homeowners association fee (HOA fee) is an amount of money that must be paid monthly by owners of certain types of residential properties, and HOAs collect these fees to assist with maintaining and improving properties in the association. HOA fees are almost always levied on condominium owners, but they may also apply in some neighborhoods of single-family homes.

For condominium owners, HOA fees typically cover the costs of maintaining the building's common areas, such as lobbies, patios, landscaping, swimming pools, and elevators. The association may also levy special assessments from time to time if its reserve funds are not sufficient to cover a major repair, such as a new elevator or new roof. HOA fees can also apply to single-family houses in certain neighborhoods, particularly if there are common amenities such as tennis courts, a community clubhouse, or neighborhood parks to maintain.

What Do HOAs Do?

In addition to taking care of maintenance and repair issues, HOAs also create rules related to parking or the use of common areas. In neighborhoods of single-family homes, the HOA may create rules on how often members can paint their houses, which types of fences they may have, how they must maintain their landscaping or related issues.

What Happens If Someone Doesn't Pay HOA Fees?

If an owner of property governed by an HOA does not pay the required monthly or annual fees as well as any special assessments, the HOA can take action against the delinquent homeowner. The actions depend on the contract between the HOA and the homeowner. Some contracts dictate that the HOA can charge late fees to the homeowner, while others allow the HOA to initiate a lawsuit, place a lien on the property, or foreclose on the owner's property to collect the delinquent payments. If a member fails to remit payment to the HOA, it affects the other members of the community. Common areas may suffer due to lack of funds, or other members may be assessed special fees to cover maintenance costs or other expenses.

How Much Are HOA Fees?

HOA fees vary drastically, but some estimates claim these fees are between $100 and $700 per month, with roughly $200 as an average. However, fees vary based on what the HOA provides. Generally, the more services and amenities, the higher the fees. In some cases, owners face higher fees if the reserve fund is not managed correctly. Because of that, a potential homeowner should investigate the efficacy of a particular HOA before agreeing to buy a home in that community. Additionally, the buyer should add the cost of the fee into their prospective budget when determining whether or not they can afford a property.

By JAMES CHEN Updated Apr 25, 2019

Posted in buy house
Dec. 13, 2019

6 Reasons to Avoid Private Mortgage Insurance


PMI typically costs between 0.5% to 1% of the entire loan amount on an annual basis. You could pay as much as $1,000 a year—or $83.33 per month—on a $100,000 loan, assuming a 1% PMI fee. However, the median listing price of U.S. homes, according to Zillow, is $279,000 (as of Feb. 28, 2019), which means families could be spending as much as $233 a month on the insurance. That’s as much as a small car payment!

No Longer Deductible

Up until 2017, PMI was still tax deductible, but only if a married taxpayer’s adjusted gross income was less than $110,000 per year. This meant that many dual-income families were left out in the cold. The 2017 Tax Cuts and Jobs Act ended the deduction for mortgage insurance premiums entirely, starting in 2018.

Your Heirs Get Nothing 

Most homeowners hear the word “insurance” and assume that their spouse or kids will receive some sort of monetary compensation if they die, which is not true. The lending institution is the sole beneficiary of any such policy, and the proceeds are paid directly to the lender (not indirectly to the heirs first). If you want to protect your heirs and provide them with money for living expenses upon your death, you’ll need to obtain a separate insurance policy. Don’t be fooled into thinking PMI will help anyone but your mortgage lender.

Giving Money Away

Homebuyers who put down less than 20% of the sale price will have to pay PMI until the total equity of the home reaches 20%. This could take years, and it amounts to a lot of money you are literally giving away. To put the cost into better perspective, if a couple who owns a $250,000 home were to instead take the $208 per month they were spending on PMI and invest it in a mutual fund that earned an 8% annual compounded rate of return, that money would grow to $37,707 (assuming no taxes were taken out) within 10 years.

Hard to Cancel

As mentioned above, usually when your equity tops 20%, you no longer have to pay PMI. However, eliminating the monthly burden isn’t as easy as just not sending in the payment. Many lenders require you to draft a letter requesting that the PMI be canceled and insist upon a formal appraisal of the home prior to its cancelation. All in all, this could take several months, depending upon the lender, during which PMI still has to be paid.

Payment Goes On and On 

One final issue that deserves mentioning is that some lenders require you to maintain a PMI contract for a designated period. So, even if you have met the 20% threshold, you may still be obligated to keep paying for the mortgage insurance. Read the fine print of your PMI contract to determine if this is the case for you.

How to Avoid Paying PMI

In some circumstances, PMI can be avoided by using a piggyback mortgage. It works like this: If you want to purchase a house for $200,000 but only have enough money saved for a 10% down payment, you can enter into what is known as an 80/10/10 agreement. You will take out one loan totaling 80% of the total value of the property, or $160,000, and then a second loan, referred to as a piggyback, for $20,000 (or 10% of the value). Finally, as part of the transaction, you put down the final 10%, or $20,000. By splitting up the loans, you may be able to deduct the interest on both of them and avoid PMI altogether. Of course, there is a catch. Very often the terms of a piggyback loan are risky. Many are adjustable-rate loans, contain balloon provisions, or are due in 15 or 20 years (as opposed to the more standard 30-year mortgage). 

The Bottom Line

PMI is expensive. Unless you think you’ll be able to attain 20% equity in the home within a couple of years, it probably makes sense to wait until you can make a larger down payment or consider a less expensive home, which will make a 20% down payment more affordable.

Investopedia, Investopedia Staff
Posted in Buying a Home
Nov. 27, 2019

Tips for selling in the winter

Selling This Winter? Here are Some Great Tips to Make Your Home More Appealing to Potential Buyers.

Clear a Path

Continually shovel a path through any snow, even if flakes are still falling. Footprints on freshly fallen snow will turn to ice if the temperature is low enough, so scrape the walk and steps periodically, and sprinkle a layer of sand or salt over them. Remember to open a path from the street to the sidewalk so that visitors aren't forced to crawl over snowdrifts. Put a rubber mat by the front door or a container to hold wet umbrellas and shoes.

Let in the Light

Pull up the blinds, open the shutters, push back the drapes on every window (unless the view or outdoor scenery is particularly undesirable). Turn on every light in the house, including appliance lights and closet lights. You can further brighten dark rooms with few windows by placing spotlights on the floor behind furniture.

Make Everything Sparkle

Washing the windows enhances the precious daylight hours. Clean out cobwebs and dust furniture, ceiling fan blades, and light fixtures. Bleach dingy grout and, if necessary, recaulk tubs, showers, and sinks. Polish chrome faucets and mirrors. Clean out the refrigerator; it probably needs cleaning anyway. Wash or polish floors, and vacuum daily; if you have plush carpeting, vacuum in one direction. Empty trash and recycling bins every day.

Turn Up the Heat

You want the temperature inside to be comfortable and to give the buyer more incentive to linger, especially on a cold day. So pump up that thermostat. It's better to heat the house a degree or two warmer than usual and then set the temperature at normal; this prevents the heat from kicking on when the buyer is present (some HVAC systems are loud). If you have a fireplace, light it up, but be sure to open the damper, place a screen in front of it, and don't leave it unattended for very long.

Create a Mood

You want rooms to appear especially warm, cozy, and inviting. Make your living room romantic by placing two champagne glasses near a champagne bucket on the coffee table; toss afghans or throws across the arms of your sofa. Dress your dining room table for a dinner for two. In the bedroom, set a breakfast tray on the bed containing a coffee cup and saucer, napkin, and reading material. Turn your bathroom into a spa by hanging plush robes on the door, placing washcloths and towels in baskets, arranging a grouping of soaps, lotions, and shampoo. Evoke a sense of summer. Place vases filled with flowers around the house. Display photographs showcasing flower gardens and lush green lawns.

Turn On the Sound

Don't neglect the aural ambiance. Have soft music playing throughout; light jazz or classical music is always soothing. If it's the festive season, nonreligious holiday music is a nice touch. Stream your tunes from a computer or tablet, using iTunes or a service like Spotify, so that your music will be continuous. 

Ease Up on the Scents

Many people are allergic to certain scents and deodorizers, so don't spray the air or plug-in air fresheners. Don't burn candles or spray perfume in the bedroom for the same reason.

Use Technology

Plug indoor lamps into a timer to automatically turn on at times you're showing the house. You can also use timers to show off how amazing the property looks with holiday lights! Consider using motion sensors that light up in the evening when a buyer approaches your doorstep.

Posted in Selling Your Home
Nov. 22, 2019

Advantages of Selling in the Winter


Although the weather is getting cooler, it doesn’t mean people will stop house hunting. Spring and autumn have been labelled the busiest time for buying and selling with large sales numbers, however, there are plenty of advantages when listing your property in the Winter.


In the spring, sellers flood the market. There is considerably more competition, giving buyers more homes to chose from. In contrast, your house has a relatively bigger buying pool during the “off” season.


Most people looking for a home during the winter are serious buyers. They may be up against a deadline (expiring lease, job relocation, etc.) or have been battling against other buyers during the peak real estate season and are ready to snag up an available property. In short, buyers in the winter are more motivated to buy and less likely to be curious lookie-loos or tire kickers.


People are generally more inclined to make offers at or over the asking price. This stems from the previous benefits – more serious, motivated buyers and fewer homes to choose from. They may also be the buyers who missed out on property in the Spring market, and desperate to find a place to call home.


Your realtor, including yours truly, most likely has a lighter load during the winter. Therefore, he or she has more time to devote to you and the motivation to make you a top priority.


By taking a different marketing approach, you can stop your property from looking dark and dreary. Advertising in winter is the perfect opportunity to present the property in a different light. Features such as heating, a roaring fireplace, insulation, and lighting can help show off how warm and inviting your home can be.


With fewer people buying, mortgage companies are able to process loans more quickly. Like realtors in the offseason, they have more time to devote to their borrowers, and more motivation to close as soon as possible! In fact, everyone involved in the process, such as home inspectors, appraisers, handymen needed for repairs, title companies, and insurance providers, generally are less busy and more able to spend time on your transaction to ensure a smooth and quick closing. If you’ve been sitting on the fence about listing your home during the winter, why not take advantage of these benefits and list now?

Posted in Selling Your Home
Nov. 15, 2019

Oil vs Gas

The Pros and Cons of Oil and Gas Heating

You want to feel warm and cozy when the temperatures drop. At the same time, you don’t want to take a deep hit to your bank account when the power bill arrives. When shopping for a new furnace, it is wise to consider the fuel sources they use. While some swear by gas furnaces, other contest that oil is best. In the end, both types are good at making your home feel comfortable. Knowing the advantages and drawbacks of each will help you make an educated decision based on your needs and budget.

Efficiency Ratings

In the U.S., heating and cooling costs account for nearly 50 percent of the energy use in a home, according to the U.S. Environmental Protection Agency. Before shopping for gas or oil furnaces, keep in mind that the Annual Fuel Utilization Efficiency (AFUE) rating is one of the most important factors when selecting a heating system. The rating indicates the efficiency of the furnace’s combustion. Furnaces with higher AFUE ratings are more efficient. An appliance with a 60 AFUE rating will not yield any energy savings, while those with a 90 AFUE can save about 29 percent on heating costs. Bear in mind that in addition to AFUE ratings, gas and oil prices also affect energy costs.

Gas Furnaces VS Oil Furnaces

Gas Furnaces

Cost: Gas furnaces are generally 10 to 25 percent more expensive than oil furnaces. Installation prices are similar for both types of appliances. If a municipal gas line does not already run to your home, you must pay to install one.

Efficiency: Most new gas furnaces have AFUE ratings of 89 to 98 percent. Gas is a clean-burning fuel and the cleanest nonrenewable energy source. The full environmental implications of hydraulic fracturing remain unknown.

Space considerations: If you don’t have a chimney in your home, you many need to install one. Alternatively, you may need to purchase a furnace that you can install near an exterior wall so it vents directly outside, bypassing the chimney.

Size: Gas furnaces have a smaller footprint than oil furnaces because they don’t require a fuel storage tank.

Safety: Without proper maintenance and monitoring, gas furnaces carry a risk of leaking dangerous carbon monoxide into the home. Gas leaks endanger occupant health and are explosive.

Lifespan: Up 25 years with proper maintenance.

Ease of maintenance: The furnaces tend to be simpler and less expensive to maintain than oil furnaces because they stay cleaner during the heating season. The heat that gas furnaces produce is not as hot as oil furnaces when measured in British thermal units.

Other considerations: Gas furnaces hook up to a municipality’s infrastructure via an underground pipeline. Not all neighborhoods have gas lines in them. Natural gas is highly available and less volatile than oil in regards to cost.

Oil Furnaces

Cost: Oil furnace units tend to cost less than their gas counterparts do, but oil prices tend to be more volatile than natural gas prices. Oil also tends to be more expensive than natural gas because it is often imported.

Efficiency: Most new oil furnaces have AFUE ratings of 80 to 90 percent, but generally produce fewer emissions than gas furnaces.

Space considerations: Because oil furnaces manage high temperatures well and get hotter than gas furnaces, they heat large spaces evenly. Incidentally, they are great for homeowners in regions with frigid temperatures that dip into the single digits. Like with gas furnaces, if you don’t have a chimney in your home, you many need to purchase a furnace that you can install near an exterior wall so it can vent directly outside.

Size: Oil furnaces require an on-site storage tank in an accessible area of the home and regular oil deliveries. As a result, the heating system has as larger footprint than a gas furnace.

Safety: An oil furnace does not leak carbon monoxide into the home. While it is flammable, oil is not explosive.

Lifespan: Up to 30 years with proper maintenance.

Ease of maintenance: Gas furnaces tend to require more maintenance because of soot and dirt buildup. In addition to maintenance, you will also have to pay for the cost of oil deliveries, oil changes, and oil filter changes.

Other considerations: If the furnace heats water, you will have to run it year-round. An oil furnace may be more convenient if you live in a remote area because it doesn’t require a direct connection with local utilities. Oil-fired furnaces may be noisier than gas-fired ones.

aaa heating and cooling
Posted in Buying a Home
Oct. 30, 2019

How To Move When You Have Too Much Stuff

Are you planning on moving in the next 6-8 months? Don’t let your belongings take ownership of you. As consumers, we tend to accumulate a lot of “stuff” over the years. After spending 5, 10, or 20-plus years in one home, this can amount to more than some of us can handle. Do you have more than 4 sets of dishes? How about piles of toys & board games from when your kids were younger? And then there are those passed-down antiques that no one in the family seems to have use for, yet no one wants to throw away. Rather than rush while packing and having to take the whole mess with you to your next home, consider starting the process early! You can categorize your belongings into the following groups:




Throw it away

It may be hard to discern which category an item goes in. This is why it’s a great idea to solicit help when you’re moving and downsizing your piles of stuff. An outsider can be a bit more objective to help you see what’s useful and what isn’t.

The Keep Pile

The items you want to keep through your move are those that you use every single day. There’s no question in your mind that you’ll need these things at your next residence. Think of the items that are either irreplaceable or still in good working condition like bedding, the coffee pot, furniture, and personal items like books, DVDs, and electronics.

Sell For Profit

If you have a question about any of the items that you’re going through, you may want to consider selling them. Is your sofa still in good condition, but won’t fit well into your new place? It’s time to get that piece of furniture to another good home and make a bit of cash while you’re at it. There are tons of websites, apps, and other resources that connect you with people who are looking for the items that you want to get rid of.


Some items may not be an easy sell. You may not even have the time to sell them. This is where donation centers allow you to do some good while you’re cleaning out your things. As you’re packing for the move go through things like clothes, books, DVDs, games, toys, and other knickknacks. Those figurines that have been sitting on the shelf may not be ideal for your new house. It’s also a good idea to keep the amount of space that you’re dealing with in mind. If you have less space, downsizing will be ever important. On the flip side, if you’re moving into a bigger house, you don’t necessarily need to fill it up!

Trash Pile

Unfortunately, we’ll always have a few things that need to be thrown out. Items that are ripped, stained, worn, broken, or plain useless must face the fate of the dumpster. No matter how you go about cleaning out your home before a move, you should know that it will feel amazing to have a lighter load to move as the clutter is cleaned out.

Posted in Selling Your Home
Oct. 25, 2019

Some of The Scariest Things a Home Inspector Might Find in Your House

Home inspections are scary. Just when you swear you've found the house of your dreams, a home inspector comes along and tells you everything's that's wrong with it—which might lead you to think you should run for the hills!

But rest assured, most things turned up during a home inspection aren't deal breakers. Still, there are certain red flags that really should make you very, very afraid. So how can you tell? For starters, you should try to attend your home inspection to see firsthand how your inspector reacts as he checks out your house.

If your inspector comes to an abrupt halt when entering a room, or their whole demeanor changes, it's possible they've just run across something very bad. Another red flag is if you hear an inspector say, “I’ve never seen this before! 

The somewhat bright side? You should know that pretty much any defect found in a house is fixable. It's just a matter of how much money you want to spend on the repairs. So if you find big bills scary, know that the 10 problems below don't come cheap. Any of the problems we have mentioned below could easily start at around $5,000 and go up from there. So if your home has any of these issues, don't say we didn't warn you.

Bad Electrical Panels

There are three brands of electrical panels—often called fuse boxes or breaker boxes—that we always recommend replacing, due to safety issues. They haven't been manufactured for decades, yet they still pop up often. The three brands are Federal Pacific, Zinsco, and Bulldog Pushmatic. All of them have issues with not tripping properly when excess current goes through them. The Zinsco breakers also have issues with electrical arcing, leading to fires inside the panel. New electrical panels could run you around $4,000 to $6,000.

An Old Deck

People are surprised to hear that decks only have a 12- to 15-year life span. The issue is the fasteners; they corrode and lose their hold on the house, and the result can be a catastrophic collapse. Every year, people are injured or killed in deck collapses, because homeowners aren't aware their decks aren't safe. Plus, rebuilding a deck isn't cheap, totaling anywhere from $10,000 to $15,000.

Cracked Chimneys

Any chimney repair will be expensive. Even a simple crack could mean having to demolish some or all of a chimney and rebuild it. A chimney that has separated from the house is even worse. It cannot simply be pushed back into place. It has to be completely taken down and rebuilt. A complete chimney rebuild can easily top $20,000.

Polybutylene Pipe

This water pipe, typically gray in color, was widely used in the 1980s, and was subject to a class action settlement because the joints tended to fail, causing flooding. We still see it sometimes, and we always recommend replacing it. The bill generally starts at about $10,000.

Aluminum Wiring

Around the time of the Vietnam War, copper shot up in price, so electricians turned to aluminum for wiring houses. The problem is that aluminum expands and contracts more than copper when it gets hot, which weakens the junctions, so there was a big increase in arcing and fires inside walls when connections loosened up. Some insurance companies won't write policies on homes with aluminum wires, because of the risk of fire.

Buried Oil Tank

An environmental time bomb, and if it is leaking, the stakes are enormous. There is no limit to the homeowner's liability for cleaning up the contamination from a leaking tank, and insurance will not cover it.

So you think there's no way a tank is buried on your property? You may be surprised. Buried oil tanks are still quite common in colder climates; burying the tank helps prevent the fuel from freezing and lets it flow more smoothly. Plus, older tanks were often single-wall, so any corrosion or damage to the tank could mean oil seeping into the ground. In the case of an oil leak, the tank and all the surrounding soil must be removed and disposed of as hazardous waste; the soil gets dug out until all traces of oil are gone. If it's been leaking for a while, that could mean a lot of soil.

Broken Trusses

Altering roof trusses can seriously affect the structural integrity of the roof. We see truss sections cut to accommodate pull-down attic stairs, or to install a new air conditioner, or even in an attempt to make the 'wasted space' in the attic more usable. Fixing these trusses requires a structural engineer's input. As well as thousands to fix.

R-22 Refrigerant (freon)

This is the stuff that makes old air conditioners work—and since it's no longer being manufactured, repairing systems that use it has become costly. A repair that was once maybe $200 could now be well over $1,000. An A/C that uses R-22 doesn't need to be replaced immediately, but when it needs repair, it should be replaced instead. Keep in mind that an A/C will likely conk out in the middle of summer, when contractors get backed up and prices may be inflated. So it may be prudent to replace a creaky old system before it breaks.

Foundation Cracks

These are bad because they can be enormously expensive to repair properly, and the consequences of poor repair can be structural collapse. "It could be a structural problem" is a phrase homebuyers are particularly wary of. You should consider a structural engineer to be called in. That could end up costing no more than the engineer's fee if it’s determined to be an insignificant deficiency, but, it could require remediation to correct the problem.

Environmental Problems

Asbestos insulation, asbestos floor tiles, termites, mold, lead paint—all are things that must be addressed by a professional, meaning someone other than a run-of-the-mill home inspector ... and could add up to a big bill.

Posted in Buying a Home