Warning signs your fixer-upper may be a money pit
Sometimes buyers can score a great deal on fixer-uppers. Other times, it's the seller who scores a great deal -- by dumping their money pit on an unsuspecting buyer.
When you buy a fixer-upper, you can't expect to defer your repair costs by buying a home warranty plan and filing a claim every time something breaks. It's on you to make the renovations, which means you need to know precisely what you're getting yourself into before taking the plunge.
Keep a skeptical eye out for these 15 warning signs of a money pit as you scout your next house.
1. A listing that says "sold as is"
The most obvious warning sign is, well, an actual warning from the seller.
If the seller specifies they absolutely will not make any repairs, you know right away the house needs repairs. Whether those repairs fall within your budget is another question, and one you better answer before making an offer.
Unless you're a contractor yourself, find a good contractor -- or three -- and request quotes before making an offer. Alternatively, make an offer if you're worried about losing the deal to another buyer, but make sure you have an escape clause in the contract so you can pull out of the deal if the quotes come back higher than expected.
Finally, keep in mind that an appraiser must sign off on the house as habitable as a condition for most conventional and FHA mortgage loans. If it's not habitable as is, you'll need a 203k loan, hard money loan or other renovation financing unless you can buy with cash.
Pro tip: If you need help finding contractors, use a service like HomeAdvisor. They've already done the research, so you know the quotes you're receiving are from quality companies.
2. The smell of moisture
Water does terrible things to houses when it's not confined to pipes and plumbing. From warping to rot to mold, moisture can render homes uninhabitable in a matter of days. Homes have had to be bulldozed and rebuilt because of toxic mold.
If the air smells damp inside the home, consider it a giant red flag. Even something as minor as a slow plumbing leak behind a wall can cause massive mold and rot over time.
Pro tip: Get a mold test done, scour the ceilings for signs of leaks and check every inch of the basement and foundation for cracks or water.
3. Warped walls
• Money Crashers is a personal finance education website that helps people of all ages and income brackets make wise choices about credit and debt, investing, education, real estate, insurance, spending and more.