What Happens After My Offer Is Accepted in Blue Ridge? A Step by Step Blue Ridge Cabin Buyer’s Guide

Luke Carl [00:00:03]:
Welcome to the Short Term show from Blue Ridge, Georgia. We will cover everything you need to know, including buying, holding, managing from a distance, raising rents, renovating and how to rent it when you are not using your very own vacation home in the North Georgia mountains. For more information on current purchase prices and income data, please visit theshortermshop.com welcome to the Short Term show special episodes from Blue Ridge. Here we are. Short Term show from North Georgia. We’re in the mountains today and today we’re going to talk about the contract process, which of course is going to be leaning heavily on Mr. Yock, who is a fantastic real estate agent in the market. And we do have a special guest today which is a home inspector from the market as well, Bruce.

Luke Carl [00:01:06]:
We will get to him in just a little while. But yeah, let’s talk about all the, all the nuts and bolts as far as like, you know, getting under contract and how to handle the contract process, which for me at least when I first started was always the most nerve wracking part of the whole thing. I don’t really like being told, you know, how to do things and waiting around and that can be very stressful. So let’s talk about just in general negotiating the terms of the contract. What are you seeing right now, Yak, as far as earnest money? What are we looking for as far as a standard amount?

Yok Re [00:01:42]:
So, you know, earnest money, you know, right now I’d say somewhere between 1 and 2% of the contracted price. You know, no fixed value, of course, and all of it can be refundable. Okay. We don’t have like option money or you know, other states have that. It’s basically just, it is just your earnest money and you, you can basically get 100% of that back if something, you know, let’s just say something goes awry in the contingencies and it’s not necessarily your fault. You know what I mean? You know, home inspection is, you know, doesn’t work out or you know, financing or appraisal. Those three things can definitely make it pretty easy in the state of Georgia for the buyer to get his money back. So I would say in Georgia the due diligence process is very powerful or it’s, it’s structured to where it’s very buyer friendly on the front end of the contract for the buyer and on the back end of the contract it’s powerful for the seller.

Yok Re [00:02:42]:
Okay. So there’s a big shift in power of who has all the leverage when you’re under contract on something in Georgia.

Luke Carl [00:02:48]:
Well, let’s just slide right into contingencies then. So what? Contingencies are common in your market and at this point in time, again, the market changes constantly. But are adding more contingencies going to be detrimental to trying to get the deal right now or not?

Yok Re [00:03:03]:
Really Great question. You know, I think now we. I feel like this market has become a little neutral. You know, it’s not necessarily a seller’s market as it is in some places. Here it’s somewhere in the middle. Because of that, you know, the contingencies have a normal length and the three contingencies, which all start from binding contract date, okay. They all start concurrently. Is going to be your due diligence period.

Yok Re [00:03:28]:
In the past you’re getting about five days. Now you can get 10 day, or you now you can get seven to, you know, a week, maybe even two weeks, maybe even 14 days of due diligence period. Okay. And during the due diligence period, it’s exactly that. It’s. It’s a time for the buyer to figure out what’s wrong with the house. It’s not necessarily up to the agent. It’s not.

Yok Re [00:03:49]:
Or either agent. It’s not necessarily up to the seller. I recommend, you know, we can’t always take a seller’s word for it. Right. And you know, I tell everybody it’s your time to figure out what’s going on. Do you, do, you know, as a buyer get these CC and rs, you know, the restrictions have your.

Luke Carl [00:04:08]:
I’m sorry, hold on, slow down, slow down. Explain that to me like I’m two years old, three years old. What is the ccr?

Yok Re [00:04:14]:
Sorry, you know, get their from CCR.

Luke Carl [00:04:16]:
Is a kick ass band from California.

Yok Re [00:04:19]:
I thought they’re from Seattle.

Luke Carl [00:04:21]:
Are they from Seattle? I thought they’re from Sacramento. I’m gonna need to Google that. I’m a huge fan, so. I can’t believe.

Yok Re [00:04:25]:
I don’t know if I’m. If I’m right. You owe me a bush light.

Luke Carl [00:04:28]:
Okay?

Yok Re [00:04:29]:
No, they are. CCNRs are basically the covenants, you know, the covenants and restrictions of a neighborhood. You know, and I always tell everybody, you know, if you have an attorney or somebody you trust to look through that, that is your opportunity as a buyer to go, go through those, go through those documents and make sure there aren’t any hiccups, you know, in the way for you to run your short term rental business within that neighborhood. You know, if you’re into ghost, it is your time to have conduct a seance in the basement to make sure it’s not haunted. Whatever you think may be wrong with a property, the due diligence period is that time to do that. And I know I’m being kind of hyperbolic about, you know, testing it for, for, for ghosts, but if, if you wanted to get it inspected for termites, that period is your time to do it. If you wanted to get it inspected for apparitions, it’s that time for you to do it. If you want somebody to look at the roof, that is the period you do it.

Yok Re [00:05:28]:
Not after due diligence. And, and I want to stress here, Luke and I probably should have said this in point number one is I feel like, and you know, you, you, you help manage a really large team. All of us at short term shop from all the way from heck, we’re now in Arizona to Florida. You know, cover almost every state in between within the south. In the south, and then obviously some north of us as well. But in talking and hearing your conversations with other agents in other states, I can tell you that Georgia contracts, we live and die by the numbers and terms on that contract. Sellers here are always pretty shrewd. I hear people in Florida saying, ah, we need to move this date.

Yok Re [00:06:11]:
Do you mind if you give me a few more days here? And this, that and another in Georgia sellers are here. They’re ready to kick your teeth in. They’re ready to say, no, sir, where’s your earnest money? Okay, So I want people to know, nobody’s mean here, but I want people to know that don’t assume a bunch of flexibility when you go into contract here, because people here, we, we live and die by the numbers on that original contract. And don’t assume people are going to give you leeway on things. So that’s why I kind of stress to my clients, I like to have us ready. I want to have everything ready. I want to have my guy Bruce on the go. If we’ve got a short contingency period, you know, short due diligence period, I want to know your lender.

Yok Re [00:06:51]:
I want to make sure that, you know, the other two contingencies will roll right into it. We’ve got financing and appraisal, you know, here in the state of Georgia, usually 21 days you’ll get. But some states will give you 30. You know, here they’re not going to do it. A seller is not going to wait a month to figure out whether you’re good for the loan or not. And if it even gets mildly competitive, you better knock that down to about 10 to 14 days. Instead of 21. And that means you got to work with a lender that has relationships with appraisers that can get their butt up there and get an appraisal done.

Yok Re [00:07:23]:
And in today’s market, believe it or not, even though buying is less competitive, sellers still want a short appraisal period because their agents are telling them, hey, appraisers aren’t as busy as they once were. We need to know the appraisal in 10 days. Okay.

Luke Carl [00:07:38]:
Yeah. So what you’re describing sounds to me about, like, how I would personally handle this process in any town. Like, don’t play around. I mean, you get a certain period of time. You get a certain period of time, get your ducks in a row. And if you can’t get it done in that period of time, then you don’t need to be hanging around anyway. Right?

Yok Re [00:07:51]:
So it’s, it’s very much like that. It’s a pressure cooker for about two weeks, and then we’re kind of sitting on our hands. You know, we, we. We get all the hard stuff done in probably 10 days.

Luke Carl [00:08:02]:
Tell me again, what does CCR stand for again?

Yok Re [00:08:05]:
Oh, boy. Covenants, restrictions. And I can’t remember the other something else.

Luke Carl [00:08:10]:
Okay, now, I did look it up. I. Neither one of us. I wasn’t. I was closer than you. I was really close. Not Sacramento. It’s actually a little teeny, tiny town between San Francisco and Sacramento called El Cerrito.

Luke Carl [00:08:21]:
California is where they’re from. Seattle, ccr, the band that we all know and love. I’m actually a major, major fan. And I would have been heartbroken if I did not get that right, because I have invested quite a bit of time in that band in my life. But anyway, yes, they’re definitely from the northwest, let’s put it that way, which is weird. That’s where I see. That’s why I’m keep going on this. We get weird with that because CCR has this southern kind of vibe.

Yok Re [00:08:50]:
Oh, they’re Southern. If you had to classify them as.

Luke Carl [00:08:51]:
Southern rock, they would be southern rock. Right. But they’re. But they’re from northern California, which makes it even more really just interesting. Like, where did that sound even come from? You know? But anyway. Okay, cool. So as far as the contingencies are concerned, we want to make sure that we don’t play around. And are you, Are you hinting here that they’re.

Luke Carl [00:09:12]:
They’re not going to be shy about taking your earnest money?

Yok Re [00:09:15]:
I’m going to say that, yeah. I’m going to say that I’ve, you know, knock on wood, I’ve probably only had it happen to me once in my entire lifetime. But you do have to have a. You know, this comes into the point, Luke, I feel like a lot of times, and not to beat a dead horse, we always like to give recommendation on lenders, you know, and in certain markets, I feel like you have to have a lender that can perform to a certain measure. And if you’re used to buying property in Nevada, it may be a little different than buying it here. Or if you’re used to buying property in Kentucky, you know, you can go down the road to your credit union and they tell you, hey, yeah, I can give you this tremendous rate. But they really struggle to go through the processes in time and assume there’s going to be some flexibility. So that’s why I tell people, use a local lender no matter where you are, you know, whether it’s Florida or, you know, I don’t care, the state of Maine, because they’re going to understand how contracts work, work in that state, and they’re all a little different.

Luke Carl [00:10:12]:
Somebody ever offer as is or is. This is the, is the term those two words, as is ever used. And can you explain to me what that means?

Yok Re [00:10:20]:
For sure, we do get some as is sales. And that basically says, you know, that is the seller telling the buyer, we’re not doing repairs and we’re probably not doing any concessions. Okay.

Luke Carl [00:10:32]:
That’s going to be in the, in the, the listing, is what you’re saying.

Yok Re [00:10:37]:
At the very, at the very minimum, it will be in the private notes to the, for the agents and they will be able to convey that to you. Okay. Now, a lot of times what I am seeing now are a lot of properties, you know, they’re putting sold as is, but we welcome your home inspection. Okay. Meaning, you know, again, it’s not, it’s not anything technical. It’s not anything that’s going to be in the contract, but even though it is being sold as is, they will give you a, an appraisal, you know, or due diligence, period.

Luke Carl [00:11:09]:
In other words, I’m not a lawyer, but that sounds to me like, hey, we’re selling it the way it sits, but you have your inspection. If you don’t like the way it sits, you can get out. Is that what we’re saying?

Yok Re [00:11:19]:
That’s it. Basically, take it as is or have a nice day.

Luke Carl [00:11:24]:
Okay, got it. And is that common or how often.

Yok Re [00:11:27]:
How often are we seeing it’s kind of common? It’s I wouldn’t say super common, but you see it. I would also say that a lot of times if I’m representing my buyer, I want to call the seller’s bluff. You know, if I find something mega wrong with it, I’m going to bring it up to their, you know, to them and say, hey, look, we got a. We kind of got a problem here. You know, there’s something significant, you know, structural here that we need to. We need to fix. So I like to call their bluff sometimes when they do as is. I’ll be honest with you, Luke, and think about this from a marketing standpoint.

Yok Re [00:12:02]:
If you see something sold as is, does that kind of give you pause as a buyer? Do you think they’re trying to hide something?

Luke Carl [00:12:11]:
Well, see, now, I’m not all that familiar with your market, but I will say in the markets where I operate, as is, in one of my markets is very common. As a matter of fact, most of the listings and. And the contracts will say as is. That’s going to be in Florida. But they don’t. It’s different than it is in the other states where I operate. I buy a lot of real estate in Alabama, for instance. And as is, where I operate is in Alabama is we’re not going to play with changing anything in this house.

Luke Carl [00:12:43]:
And it’s usually some sort of distressed sale where the owner died and his children now have it, and they’ve got to deal with the sale of the property, and they don’t know anything about floors and H vacs, et cetera, etc. It’s not all that common. I would assume that’s a little bit more towards what you’re leaning towards here in Georgia. Like, if it ends up being as is, maybe a seller that. Would you say that it’s a seller that doesn’t really know how to fix these items or have the means or what?

Yok Re [00:13:10]:
I would say, yes, I would say probably doesn’t have the means, doesn’t want to do it, and it’s trying to flex a little bit of muscle, you know, saying, hey, this is the price period, the end. And sometimes it. In my opinion, if I’m selling, I don’t really like to tell my people as is, because I think people see that and just automatically think there’s not going to be much flexibility within this contract. And it makes people nervous.

Luke Carl [00:13:34]:
Yeah. So, I mean, we’re only talking, what, 10% of the time you see as is, if that. Something like that.

Yok Re [00:13:40]:
If that.

Luke Carl [00:13:40]:
If that uncommon. Okay, I got you. Yeah, yeah, yeah. I actually kind of like seeing that as is because it’s almost like to me it’s like, wait a minute, there’s something going on here, they need to sell this and they, there’s some things that they can’t fix and that might push other by some other buyers that are not as sophisticated out of the equation.

Yok Re [00:13:56]:
Sure. You know, if you’re doing some long term rentals and things like that. Absolutely. But you know how it is with people looking to buy short term rental. They want to get this thing up and running, you know, tomorrow, you know what I mean? So yeah, it can create a little different dynamic.

Luke Carl [00:14:09]:
Well, yeah, and also, you know, you’re not really going to long term rent a seven hundred thousand dollar cabin in the north mountains, you know, so that’s a whole different thing. Okay, cool. Let’s, let’s slide into furniture. Most of these things come in furnished and if so, how is that addressed within the contract?

Yok Re [00:14:26]:
Yeah, so I do see most of them coming furnished and they’re pretty easy. We have to put everything on a separate bill of sale as opposed to a, the, you know, the contract, if you will, the purchase and sale agreement. Because you have to understand your loan that you get from your lender is for a house. At least in the state of Georgia. It’s for a house, it’s not for a house. Plus stuff. Okay, so what, what you end up doing a lot of times is buying all the stuff for $20. Okay.

Yok Re [00:14:57]:
Contractually that way everybody, at least there’s something written down that, that kind of ties everybody to what it is. But you have to understand that, you know, the purchase and sale agreement of the property is just going to be for the property. Now connected things will count. Hot tub, you know, anything that’s kind of, you know, connected to the house will be part of it. But you know, the beds or dressers or the televisions are not necessarily part of the purchase and sale agreement. You have to take care of that on a separate bill of sale.

Luke Carl [00:15:30]:
Okay, cool. And in my experience, and let me.

Yok Re [00:15:35]:
Add this, it’s going to get appraised accordingly. It’s going to get appraised without the value of the stuff. Okay. So that’s critical to understand because when prices were getting hot and heavy, everybody would have to stand back and say, okay, that’s a $500,000 house and it’s got $63,000 worth of stuff. Okay, so it’s worth $563,000. And then there was these appraisal gaps and then, you know, then there were other People that wanted you to actually buy the furniture. And so it was a big mess today. It’s not so much.

Yok Re [00:16:04]:
But I tell people, you have to understand the value of the house is the value of the house. You know, the appraised value of the house doesn’t count the stuff.

Luke Carl [00:16:11]:
Explain that to me. What’s the furniture look like usually? Is it going to be really nice, Stu? Going to be tore up stuff?

Yok Re [00:16:18]:
Usually pretty good. You know, I, I tell people, typically when they’re buying a house that’s going to come furnished, you’re probably going to have to replace some soft goods. Okay, what’s the soft good? Yeah, soft goods. Carpets, rugs, potentially couches, you know, anything that’s kind of soft, you know, nothing you can knock on. You know what I mean? Curtains, you know, you may have some lacy tobacco stained curtains. You know, there’s quilts, you know, again, it could be mattresses, anything that could absorb a smell. I tell people that, you know, down the road you may have to replace it. The couch may be able to ride with you for, you know, six to 12 months, but, you know, may not.

Yok Re [00:17:01]:
So I tell everybody, you know, we need to look at the soft goods. But typically the stuff is ready to go. You know, when it, when, you know, majority of the time I tell people within the pictures, or if I shoot you a video, whatever it may be, we’re going to get 97% of what we see in the photography. Okay. I tell everybody, inevitably, okay, there’s going to be a wind chime that the homeowners got on their honeymoon, right. There’s going to be an end table that belongs to the, to Meemaw. Okay?

Luke Carl [00:17:31]:
Yeah.

Yok Re [00:17:31]:
And then there’s going to be Papaw’s urn sitting on the mantle. You know, we’re not going to get those three things, but it doesn’t matter because they’re not going to make you money anyway. You know what I mean? You won’t miss them. So that’s why I tell everybody we usually get about 97% of the things there and nothing we don’t get is probably going to be inconsequential.

Luke Carl [00:17:50]:
I got one going right now where we’re going to get way off topic, but it was a, it was a mess. And the lady that owned it had dementia. And the son ended up handling the sale of the property. And it was, he needed it gone quick and in a hurry, and we closed it in a hurry. And again, this is a little long term rental, but we did the clean out, which took two two dumpsters, two 30 yard dumpsters to clean this thing out. And in the process we found two boxes of ashes. Not just one, two, two people in boxes in this house. Luckily, somebody stopped by while we were cleaning it out and said, hey, my grandfather used to live here.

Luke Carl [00:18:31]:
If you find anything, let us know. And turns out we got her phone number and said, hey, we found your grandfather. And so she came back and got him. Yeah, yeah. You just never know. But anyway. All right, let’s move on to disclosures. What is the seller going to disclose and what do they not have to.

Luke Carl [00:18:50]:
That kind of thing.

Yok Re [00:18:51]:
Yeah. So this is where it’s kind of tricky. I don’t know exactly about other states, but I’ll tell you how Georgia operates. Basically, the sellers can’t lie to you. Okay. So if they’ve never lived in the property or haven’t lived there within, I believe it’s two years, they do not have to provide you with a disclosure. Okay. Not common, but I tell people it can happen.

Yok Re [00:19:12]:
Okay. So sometimes there’s a normal property disclosure, sometimes there’s a disclosure for latent defects, which is a different document. I won’t go into that very. I see that very rarely, probably only 1 to 2% of the time. But what you will notice is you will get a seller’s. Typically I’ll talk about. Best case scenario here is you’ll get a dis. You will get a seller’s disclosure and there may be a hundred items in that line, items that they have to check yes or no and give a little detail for.

Yok Re [00:19:43]:
Okay. Out of those 100, there may be only 60 of those items they check yes or no to. They don’t have to check everything. That is a seller basically telling you, hey, I don’t know and I don’t want to lie to you by saying yes or no. So, for example, you know, a seller may not know when the roof was put on. Okay. You know, he may say, have you had to replace the roof? No. And that’s it.

Yok Re [00:20:06]:
Then there’s a blank below it. When was the roof replaced? He, you know, we may not know that. Or, you know, there’s. There’s a lot of opportunities where a seller may not have intimate knowledge of the property. Because, Luke, you know this. You got a bunch of properties. You haven’t stepped foot in every single one of them in the past six weeks. Okay.

Yok Re [00:20:23]:
It’d be impossible for you to do so in the state of Georgia. A seller can protect themselves by not divulging information they aren’t sure of, okay, like the age of a hot water heater. Most sellers don’t know that, you know, you know, they have to divulge if there’s been an insurance claim. Anything that’s happened under their watch, they have to disclose. But if it happened previously, they’re basically going to kind of plead the fifth. And that is why a good home inspection has value. It’s up to that person to kind of unturn those stones and figure out, kind of give you the buyer a little history of what may or may not happen in the house.

Luke Carl [00:20:59]:
Cool. Cool. All right, let’s talk inspection. Bruce, you’re on deck, buddy. Although I am going to hit yak with a couple more on this before we bring Bruce in. How many days do I get in an inspection period with?

Yok Re [00:21:11]:
Right now you’re getting about 7 to 14 negotiable.

Luke Carl [00:21:13]:
But 7 to 14 is common.

Yok Re [00:21:15]:
Yes.

Luke Carl [00:21:16]:
All right, and so how many, like, what’s the negotiation look like after the inspection is done? Like, how many days do I have to go back and forth with them?

Yok Re [00:21:25]:
Well, you’ve got the entire length of the inspection period. Let’s just, let’s just do a 10 day to keep numbers kind of round here.

Luke Carl [00:21:30]:
Yes, go ahead.

Yok Re [00:21:31]:
Normally, what’ll happen is I’ll say, you know, I’ll get a sense that I’m about to go under contract with a client. And I’ll say, hey, Bruce, in the next 48 hours, Bruce being my home inspector, I’ll say, hey, Bruce, do you. Does yours. What’s your schedule look like in the next two days? Because I may have somebody, a hot lead for you here, somebody on deck. And Bruce can usually get out there in 42 to, you know, 21 to three days. And he can usually return that report around in about 24 hours after that. And so now we’ve got. Let’s just say it took three days to get out there, then it took a fourth day for you to get the inspection report back.

Yok Re [00:22:06]:
Now we got six days to negotiate this deal down. Okay? Let’s just say we find something wrong. Bruce. Let’s go back to our last one. Or one we typically find is there’s a couple rotted handrails on the deck, okay. And there may be a support on the deck or some boards that need to get replaced. You know, Bruce, I typically like to lean on Bruce. Bruce is kind of a.

Yok Re [00:22:26]:
And an interesting guy because not only has he, is he a great home inspector, but he’s also done. He’s built these cabins in his previous life. So he’s he knows everything about him. So a lot of times that that buyer can go to Bruce and say, hey man, what is this? You know, if you had to shoot me a quote, what does this look like? And Bruce say, oh, man, do these repairs, that’s $3,500. And now we got a lead. Now I know I can go back to the sellers, okay, and say, hey, look, we, we, we, we had this inspection done. We found these issues with the deck. This is about $3,500 worth of, worth of stuff here.

Yok Re [00:23:00]:
We would either a, like you to repair it or give us $3,500 in, in concessions and that’s it. Now typically, sometimes they repair it, sometimes they give us all the money, sometimes they tell us to go kick rocks some. Most likely what we do is meet in the middle. To be honest with you, I don’t know where the middle is, Luke. To be honest with you, Luke doesn’t mean if it’s 3, 500 that it’s at 1750. Middle may be a thousand dollars, it may be 2500. We just don’t know where exactly the middle is going to be between.

Luke Carl [00:23:27]:
We don’t know if it’s San Francisco or Sacramento or, or Seattle, but it’s no clue.

Yok Re [00:23:33]:
Somewhere in between.

Luke Carl [00:23:35]:
El Cerrito, it turns out.

Yok Re [00:23:36]:
There you go.

Luke Carl [00:23:37]:
Yeah. Okay, cool. All right, Bruce. Well, come on in, buddy, and explain to me. Let’s paint me a picture here. I’m a first time, you know, investment home buyer, second home buyer. I’m first, you know, kind of nervous, scared. What, what, what, what does this process generally look like and, and what kind of documentation do I get from you and all that?

Bruce [00:23:59]:
Usually the homeowner will call me. The realtors usually give them two or three options. And most of them, the ones that call me, I’ll talk to them on phone, explain to them that I’m going to set to give me the address of the home and then I’ll pull up the information on the home, get back with them because a lot of them want to know price. First thing you want to know from me is the price of the inspection and when I can do it. So then I’ll usually get with the realtor, finding out when the cabin is open, where we can get into it. And then I’ll get back with the homeowners telling the date we’re set up to do the inspection. And I notify them when I’m at the inspection and before I leave in case they have questions. I always notify them also.

Bruce [00:24:38]:
And A lot of times they’ll meet me there. I like to walk through everything with them at the end of the inspection. So I walk through the house with them, go over everything, try to help them feel at ease. Because when you see a report, all you’re seeing is all the bad things on the home. And many of the homes have a lot of good qualities that you don’t notice. You know, you’re getting 20% here or you have an 80% of really good home. But it scares a lot of buyers when they see the reports because all you’re reading is bad stuff on there.

Luke Carl [00:25:04]:
All right, well, I’ll go ahead and ask you. What would you say is a good. And again, at the time of this recording, which was Christmas time, 23, 24, end of 23, early 24. What is a price of a home inspection based on? I mean a broad range is totally.

Bruce [00:25:20]:
Fine, 350 to 450.

Luke Carl [00:25:21]:
And is that based on square footage or.

Bruce [00:25:23]:
Yeah, yeah, I’m pretty much size of the house and some of them will have extra apartments or I do a lot of lake properties, so they have a lot of docks, things like that also. And I’m probably underpriced from what a lot of them are. I know in the cities are a little higher, but a pretty good range, probably 400, $450.

Luke Carl [00:25:41]:
What would you say comes up on a regular basis in this. In your market that might kind of scare your client? That is not really that big a deal.

Bruce [00:25:50]:
Things that aren’t that big a deal is usually small things on the deck, usually your handrails, spindles, things like that. They’ll have problems with few broke boards may be rotted from wherever something’s sitting on the deck. A lot of times they’ll. It’ll compromise the board itself. The roofing. You always have little problems in corners of the roofs and stuff like that. And the soffits, those are the major things to look for inside.

Yok Re [00:26:13]:
Would you call a major. Would you call a major or they’re just things to look for that are pretty easily fixed, right?

Bruce [00:26:19]:
Yeah, most of them are pretty easily fixed. I mean, if you know what you’re doing, they’re really not big deal at all. But those are things I like to look at first, you know, the roof and the foundations. Of course your most important. A lot of people will worry over little things in the home that really aren’t that much. Painting or trim work, of course, your water heaters, things like that. You want to check like you’re talking about earlier I always like to check the age on them, make sure there’s no leaks on them, stuff like that, which is all easy repairs. When you’re, you’re buying a home, five, six hundred thousand dollars, I mean, you’re talking about a few repairs.

Bruce [00:26:50]:
Most on average run what, 2500 to 3500, including decks. And unless they have a roof that needs replacing, that, that pretty much covers all the repairs.

Luke Carl [00:26:58]:
Okay. Any other items that come up on a regular basis in your market, like I don’t know, maybe joist hangers or, or termites or anything like that?

Bruce [00:27:08]:
Yeah, I don’t do a lot of termite inspecting. I watch for them if I see them anywhere. I, I usually have a lot of basements more than I do crawl spaces. The majority of my cabins are rental cabins. A lot of them are already rental cabins and more renters are buying them. So, so I pretty much the outside of the home, the structure of the home and any kind of hidden things like maybe the sellers had painted over stuff that was like window trim. A lot of your window trim may have little spot to be replaced. Things like that, your air conditioning stuff, you want to check the year on it.

Bruce [00:27:39]:
If it’s been maintained, a lot of the sellers will have their maintenance schedules with them. That’s a good thing to check on. AC and heating is always, you know, a cost you don’t want to be surprised with.

Yok Re [00:27:50]:
And, and Luke, you had mentioned hanger joist and it is something that, that you know, isn’t necessarily, I don’t think in Fannin county or even in Gilmer is a code yet that you have to have them. Maybe it is today. So not every deck has hanger joist underneath.

Luke Carl [00:28:06]:
Choice hangers.

Yok Re [00:28:07]:
Joist hangers. I’m sorry, joist hangers doesn’t have joist hangers, you know, underneath it. You know, a lot of times it’s just like a one by one or something, you know, not always the best solution, but a lot of times it’s, it’s, you know, it’s a very workable deck. So, you know, some people may leave a market and you know, something falls out of contract because it doesn’t have joist hangers. Well, here I would say probably only 50% of the properties do. I mean it’s probably may not even be that high depending on the age of the home. One thing I do, and Bruce, back me up on this, I do see a lot of is you had mentioned it, it can be a little bit of rotted corners around the windowsill. You Know, just where, you know, water tends to pool.

Yok Re [00:28:48]:
And also some rotted boards around a chimney. You know, the, you know, around the chimney where you have shorter board, smaller boards, and just with the geometry of a chimney, a lot of times it can kind of hold water. And where maybe water sheds off a chimney and chimney. And then flashing, you know, sometimes the flashing around a roof, metal roof, or even composite roof may not be great. And. And neither of those are. They say it sounds scary, but it’s. It’s really not, is it, Bruce?

Bruce [00:29:18]:
No, no. And most of that’s just from caulking. You know, the caulking is wore out or hasn’t been caulked. Re caulked in the last year or two is what caused most of those problems. But yeah, as far as joist hangers, like Gilmer county, they require it now, but Cannon county, not so much even on the new homes that you’ll see them not. Not have them on there sometimes, but they definitely need them and need to be bolted, you know, to the, to the band into the home.

Luke Carl [00:29:44]:
About how many action items would you say end up on. On a typical inspection report or, you know, like, hey, you know, these items have been flagged for whatever reason. How many items in General?

Bruce [00:29:56]:
Anywhere from 30 to 50, I would say, because you’re going through a whole home. And I’m pretty thorough. I try not to get real picky on trim and stuff like that, unless the customer asks about it. And I’ll ask them, you know, if you want to know about if some of your baseboards are loose, things like that, because, you know, I want to make sure the structure sound for them. I want to make sure all their appliances are working right. I want to make sure they don’t have no surprises with the roof or the showers leaking, things like that.

Yok Re [00:30:25]:
And, and, and Luke, I kind of settled on Bruce because. And do a lot of deals with him because I’ve had home inspectors in the past that tend to focus more on the pools on a cabinet in the kitchen than they do on structural things that actually matter. You know what I mean? And I kind of wanted to have a guy on my side that I work with that is more acutely aware of, you know, the, you know, those bigger ticket items and knows how to find them. And if there are any big ticket items, hey, let’s, let’s point those out and let’s figure out, you know, is this. Is this an easy fix or is this a hard fix? And then that gives the buyers a much better indication on, hey, Is this. Is this investment worth doing or not? Not necessarily. You know, hey, the, you know, in the bathroom, the toilet paper roll thing is loose. You know, that’s not something that, you know, is.

Yok Re [00:31:16]:
It’s a. It’s a deal, but it’s not a big deal. You know, I would rather my home inspector spend time, you know, looking at the joist, looking at the bands, you know, looking at the runners on staircases, looking, you know, around the chimney, you know, those, those big ticket items.

Luke Carl [00:31:33]:
And so, Bruce, you’re saying most of these homes are going to be a basement?

Bruce [00:31:36]:
Yeah, most of the ones I do in Blue Ridge now, I work Helen, Blue Ridge and Ellijay most of the time. And most of mine are basements. The older home again, some of the older 50s to 70 homes, they’ll have a crawl space.

Luke Carl [00:31:49]:
And what do we look out for on there, on the foundation? Is there anything that comes up on a regular basis or is it just kind of sporadic?

Bruce [00:31:57]:
You’ll get. You’ll get little cracks in it. And what I look forward is where the. Where the top of the basement wall ends and the floor starts in between your trusses around the outside band, that’s where you’re going to have water leaks. It’s where you can have moisture coming in. If you’re going to have it, that’s where it’s going to be at, where plumbing is going out through the walls and it’s not properly sealed. All those little small things like that would create bigger problems later, especially if they have, like a daylight basement wall. And then you’ll.

Bruce [00:32:25]:
You’ll notice around windows and stuff where blowing rain has come in and they haven’t been caulked previously. You’ll get water coming in there, and then it starts decaying the plywood and stuff inside.

Luke Carl [00:32:35]:
Okay, great. Anything else you want, you know, kind of a new homeowner to, to understand, as far as the inspection process is concerned?

Bruce [00:32:43]:
Not really on that. I mean, I. I like to go. I go through everything with them right there on the job, and they’re also welcome to call me and I’ll go back to the home with them and walk through it. Also, I want them to understand everything on there and any questions they have, I like to address those questions, and if I can’t answer them, you know, I’ll get them answered for them.

Luke Carl [00:33:02]:
Okay, great. Cool, man. Cool. Well, we appreciate you. I’m gonna ask you to stick around for a minute just in case something else pops up, if you don’t mind, but we’ll Move on now to good faith. Tell me about good faith. Yach. Acting in good faith as far as, you know, going and looking at multiple properties at one time, that kind of thing.

Yok Re [00:33:20]:
Well, from, From. From what sense? Leave me like, what, What?

Luke Carl [00:33:23]:
In other words, tell me that a buyer should probably not make two offers on two different houses at the same time.

Yok Re [00:33:29]:
That’s right. It can. It can get you in a little bit of a pickle. And here’s the problem, too. A lot of these communities, okay, like, you know, whether it’s Cape San Blas or Blue Ridge, Georgia, not a ton of realtors here, right? And if all of a sudden, you know, let’s just say there’s 10 homes on the market worth looking at, well, there’s a good chance four of them are. Are listed by the same agent. And he’s going to see two of these things come across and see your name on both of them, you know, buyer, you know, Joe Blow. And he’s going to get a sense of, wait, is this dude for real? What’s he trying to do? Is he trying to tie up properties? And I tell everybody, all of us agents in Blue Ridge, we see each other every other day.

Yok Re [00:34:11]:
You know, you see each other at the grocery store, you see each other at Walmart or church, wherever it may be. And you know, the last thing you want is I tell client, don’t. This isn’t New York City. You’re gonna run. We’re gonna run across the same people over and over again. We’re gonna be working with the, you know, a lot of the same agents. Don’t. Don’t try to blanket bid on four houses.

Yok Re [00:34:32]:
Tie up four houses and then buy one of them. You can kind of blackball, maybe a little too strong of a word, but people will catch on real quick.

Luke Carl [00:34:42]:
Real quick. Got you, Got you. Let’s. Let’s talk about appraisal. What happens when the appraisal comes in low? Is that happening right now? Are they coming in high right now? And, and what are, you know, as far as negotiation is concerned, how do we handle the appraisal?

Yok Re [00:34:58]:
So I’ve had a couple of them.

Luke Carl [00:35:00]:
I’ve.

Yok Re [00:35:00]:
I’ve. In the past, probably 18 months, I had more of them come in high than low, and some of them a hundred thousand dollars high. Now, what does that mean? I don’t know. You know, that’s a different conversation. But usually what it means, let’s just say we got a $500,000 house, and the appraisal comes back at, you know, 490 what do we do here sometimes? I mean, you, you really got three options. Your first one is just walk away. Okay. You always have that option.

Yok Re [00:35:27]:
The house doesn’t appraise your app. Your appraisal contingency protects you from that. Okay. Assuming you get your appraisal report back within the contingency period. Right, we talked about that. You know, you may have about 21 days to do that. So make sure your lender can actually get you that appraisal within that time. But let’s just say the appraisal comes in $10,000 low.

Yok Re [00:35:47]:
What are your options? You really have three. One of them is to walk. One of them is for the seller to sell it to you at the appraised price. Or the third option is you kind of meet in the middle. But no, you’re going to fill that gap with cash. So maybe the, the seller goes, I’ll sell it to you for 495. But you got to. Which is fine.

Yok Re [00:36:05]:
You’re thinking yourself, I’m saving $5,000. But the reality is, is that you’re only getting lo. 490. You got to fill in that gap that, that 490 to 495 with cash at the closing table. So a lot of times that, that may or may not be in the cards. And sometimes if they do that, let’s just say, Bruce, we, we do a home inspection and we find the. I’m going to make something up here. The chimney needs to be replaced.

Yok Re [00:36:31]:
Okay. Never had that happen. But I’m making it up and it’s going to. And we’re able to get $10,000 in sellers paid concessions for the buyer. Okay. We negotiated $10,000 in concession because of that issue. Now it appraises low. Okay.

Yok Re [00:36:45]:
Instead of 500, it appraises at 590. The seller may say, yeah, I’ll sell it to you at 490, but you’re not getting your $10,000 in concession because I want my net to be the same. All right, so you kind of. I know I went through some math and some, some words there pretty quickly, but, you know, again, there’s a negotiation period with the appraisal. If it comes back, quote, unquote bad, and don’t assume. I know a lot of buyers are. A lot of buyers think that it’s a get out of jail free card. It is not.

Yok Re [00:37:14]:
I mean, there’s going to be a lot of sellers that are not willing to negotiate that appraisal. And you just paid, you know, four to $500 for a home inspection. You just paid five to $700 for a appraisal. Okay, you’re out 1200 bucks because you assume the seller would sell you the house for appraised value. Sometimes it doesn’t work that way.

Luke Carl [00:37:35]:
Got it. Love it. Thank you. All right, let’s talk financing contingency. Now, again, no legal advice here. I don’t have a license of any kind. But from what I understand, if you are in your financing contingency period, and you’re trying to get out of the deal, you will need a letter from the bank that says, hey, this person can’t get a loan. I can’t just walk away from the deal on financing contingency if I decide I don’t like it.

Luke Carl [00:38:02]:
Is that true? Yaak, you have anything to add there?

Yok Re [00:38:04]:
100% true. Luke, you hit the nail on the head. I assume this doesn’t vary too much state by state, but that’s exactly how it works here. And sometimes there are some brokerages and there are some agents that will press even further. They may not want, they don’t want a letter from your loan officer. They want it from the underwriter, which can be a little tough because I’ve seen it. I’ve seen the person get cold feet. We get, you know, somebody gets through the inspection period, here we are, we got 21 days of financing contingency.

Yok Re [00:38:34]:
On day 20, they realize they don’t want that, that property anymore. Guess who their loan officer is. It’s a brother in law. Okay? So the brother in law says, ah, you know, Billy Joe here, he doesn’t have the cash he needs to get out of it. And wink, wink, nod, nod. And the, the. Excuse me, the list agent and their brokerage has the right to ask for that letter of denial from the underwriter, which will be kind of an independent third party judge on this whole deal. So just know that, you know, sometimes a letter from your, your loan officer may not be good enough.

Yok Re [00:39:08]:
Your buddy that’s a loan officer may not be able to give you that get out of jail for free card.

Luke Carl [00:39:12]:
Got it? Got it. Yeah. In other words, you need to figure that out before you get to the inspection. The, the financing contingency. The, the financing contingency is exactly that. Yeah, I can’t get a loan, so therefore I can’t buy this house. And if there’s some other reason, then it’s just not going to fly. All right, final walkthrough.

Luke Carl [00:39:30]:
Talk to me about final walkthrough. I always recommend you need to go you need to go to your final walkthrough. A lot of folks doing it out of state and, and that’s, you know, some, some folks don’t go look ever. And that’s fine. I mean, I’m. I feel pretty comfortable with that. I bought a lot of real estate over the years and, and if I feel like I’m in a good situation and I’m comfortable with the whole thing, I’m happy to buy a house without seeing it. I went actually yesterday, walked some, some of my properties and I went into one.

Luke Carl [00:39:58]:
I said, I don’t think I’ve ever been inside of this. And it’s already on its third tenant, you know, again, a long term rental, you know, but I just keep going back to that today because I was. It’s fresh on my mind from yesterday. But anyway, final walkthrough. Get there, man. Especially on a short term. I mean, we’re talking 5, 6, 7, 8, 100,000, maybe a million dollars plus you need to get there and go touch that thing and smell that thing if at all possible. Do you have any, any thoughts on final walkthrough?

Yok Re [00:40:25]:
Yeah, number one, I don’t do them. Okay. I don’t do a walkthrough as a, as a real estate agent. And just hear me out, Luke, I see you recoiled in your chair there for a second. I don’t.

Luke Carl [00:40:35]:
Dorito. Yeah.

Yok Re [00:40:38]:
I don’t do a walk through. I do what I call a walk around. Okay. I’m not an engineer, so if, if repairs were happened to a deck, you know, I can, I will gladly go to the property and look under it and say, yeah, there’s new wood here, something happened. But I can’t as a, you know, I’m not a structural engineer. I’m not a contractor. I’m not a deck builder. I can’t tell you, hey, man.

Yok Re [00:41:01]:
Yeah, this looks good. It’s sturdy, it’s ready to go. It’s. It’s exactly what we wanted. You know, if you get repairs done, I tell everybody, call Bruce or call your home inspector back up and say, hey, man, the. Some repair. The repairs that we requested were, were completed at the house. Can you go check on them? And a lot of times Bruce will go back out there.

Yok Re [00:41:22]:
Not for free. Bruce doesn’t work for free. But Bruce will go back out to the property and just look at the repairs to make sure what was contracted to be done, or at least as a buyer, what you think was going to be done did actually happen and those jobs got completed. So as an agent, I’ll do a walk around. I’ll do kind of a walkthrough. But it’s not a walkthrough that I want somebody to hang their hat on and say, okay, yacht signed off on it.

Luke Carl [00:41:52]:
I agree. You cannot ask your agent to do that. It’s not part of their gig. And, and an agent that’s willing to do that, because a lot of times, you know, I will hear, hear these short term. Well, this other agent was willing to do my final walkthrough. Well, no, no, I mean go do business with them because that’s not how we, you know, we’re not willing to risk our licenses over this deal. But, Bruce, can you do a final walkthrough and give me some updates on what happened with the, you know, inspection process, etc?

Bruce [00:42:20]:
Yeah, I’ve done many walkthroughs on the final walk through, even on new homes, a lot of times I’ll find they haven’t. They’ll want me to check the things that were fixed. And a lot of times they have to come back and fix them again because they haven’t. Especially on roofs. You know, they’ll miss a few things on roofs or do the side that you can see. So I, I’ve gone back and checked several of them for people and, and they’ll have to get it fixed, you know, before the closing. So sometimes it’ll put them off a few days too.

Luke Carl [00:42:47]:
Yeah. Now get your home inspector to do it. And that’s another thing. Ask your home inspector in the, early, in the beginning of the process. Hey, can I hire you to go back over there and do a final walkthrough for me? Final walkthrough inspection. Bruce, what do you charge for that?

Bruce [00:43:00]:
It’s usually a hundred dollars. Oh, 100 bucks or it’s, it’s worth it for them. And no, no trouble at all, you know, no brainer.

Luke Carl [00:43:08]:
No brainer. Get your home inspector. Get over there. I mean, even if I am going, I’ll go ahead and on a big purchase like that on a vacation home, we’re talking 8, $900,000 or whatever it is. A hundred dollars for some peace of mind for somebody who’s a licensed professional and knows what they’re looking at, man, that’s, that’s worth his weight in gold. Wonderful, wonderful. Okay, so be present for your final walkthrough. It’s your investment, it’s your money.

Luke Carl [00:43:31]:
Nobody’s going to protect it like you will. Anything else, guys? We did great. I think we’re gonna, we’re ready to wrap. Unless. Yak, if you think we missed anything or if you want to have any. Any final words.

Yok Re [00:43:41]:
No, sir. I think we got it.

Luke Carl [00:43:42]:
Cool. Cool. Well, if you want to go through this process and buy a house, that’s why we’re here. Short Term Shop sells real estate. And YAK would be more than happy to represent you on the purchase of a home in the North Georgia mountain area and the Blue Ridge area. And feel free to contact us anytime@theshorttermshop.com. bruce, what’s the name of your company?

Bruce [00:44:03]:
Leopard Home Inspections.

Luke Carl [00:44:05]:
There you go. Leopard. Nice. Love it. Cool, man. Nice to meet you and everybody. Thanks for coming and listen to more Creedence Clearwater Revival.

Bruce [00:44:17]:
Sam.