The $400 earnest is all that I would be on the hook for should the property not close (i.e. they'll cover the $445 remaining on the appraisal should it fall through). If the property does close, then the $400 will go directly to the closing costs.
At this point my expenses are as follows:
However, only $975 would be non-refundable should the deal not close. I'm also guessing that Roofstock will waive their earnest fee since this is my first property purchase and first time using their site. It would certainly leave a bad taste in my mouth should they not give me that back. Hopefully we don't have to find out!
On the fourth week into the process, the appraisal came through, valuing the duplex at $89k, approximately $26k below the asking price! This was somewhat expected. As I mentioned in an earlier post, several other sources matched this price. I then sent a rebuttal offer of the appraised price to the seller ($89k).
The inspection came in from Roofstock on the same day. The report had tons of photos in it as well as estimates on immediate and at-turn costs. There were a number of small items that need to get fixed, but nothing that was unreasonable or that required the seller to take care of before closing. In total, there was around $7k worth of repairs that will need to be done in the next couple of years. This is in the ballpark to what I was already factoring in for my capital expenses using the 2% of purchase price rule. The big ticket items are still rated to have 5+ years left, which is what I was mainly concerned with. Overall, I think that the expenses have come in a bit higher than initially budgeted, but the drop in price will easily cover the delta.
I also had my property manager and a friend who has construction experience take a look at the inspection report to make sure that I wasn't missing anything big. Both came back saying that overall things look reasonable.
The inspection came in from Roofstock on the same day. The report had tons of photos in it as well as estimates on immediate and at-turn costs. There were a number of small items that need to get fixed, but nothing that was unreasonable or that required the seller to take care of before closing. In total, there was around $7k worth of repairs that will need to be done in the next couple of years. This is in the ballpark to what I was already factoring in for my capital expenses using the 2% of purchase price rule. The big ticket items are still rated to have 5+ years left, which is what I was mainly concerned with. Overall, I think that the expenses have come in a bit higher than initially budgeted, but the drop in price will easily cover the delta.
I also had my property manager and a friend who has construction experience take a look at the inspection report to make sure that I wasn't missing anything big. Both came back saying that overall things look reasonable.
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