Dealing with the aftermath of a house fire is not easy. There are a lot of stressful things you’ll have to go through – including buying a new house.
Buying property is one of the largest purchases you’ll ever make. Even if you aren’t putting up a large down payment, by having a mortgage you are making yourself responsible for a sizable amount of money. There’s also the possibility of tax consequences.
Here are some tips to make the process of replacing a fire-damaged house go more smoothly …
Save as much as you can
By saving as much cash as you can, you’ll have money for the things that inevitably pop up. As it is, you know you’ll need to pay for the closing costs and the initial down payment. Closing costs include the mortgage, fire and hazard insurance, title fees, and many other costly items.
Follow these tips to save money:
Get the best financing deal you can find
First and foremost, be sure to have your financing in place before you make an offer. To get the best deal, research the rates available for your credit score and try to get financing companies to compete for your business.
Ask what options are available given your credit rating. Negotiate with your lender to lower or eliminate costly fees and charges. Avoid paying an application fee if you can.
Find your own providers
You don’t have to use the companies that your agent or lender recommend. This is important when selecting your title and insurance company. Your agent and lender have lists of recommended companies because they have pre-established relationships. Keep in mind that you are the one paying them. Carefully review their fees and rates before making a decision. You can use any company you wish.
Get the right insurance
Having experienced a house fire, you understand the importance of having good insurance.
The truth is as home prices have risen so has the associate risk involved with buying and selling property. Thankfully, every type of risk now has an appropriate insurance. Of them all, the two most popular are title and liability insurance.
Title insurance ensures the coverage of any potential financial loss that is a result of an error in the processing and researching of a property title. Any lapses that might happen during the title search process, prior to closing, are covered.
The title company will search a public record database to make sure that the property is able to be sold, meaning it’s free of encumbrances. Public records are not always completely accurate, and errors can occur.
Liability insurance covers injuries that happen on, or because of, the property. If someone slips and falls on your property, your liability insurance would provide coverage. The more coverage you have, the more expensive it becomes.
Hazard insurance is available for less likely risks such as hurricanes, flooding, or earthquakes.
You can also get coverage for accidents created by humans. This includes chemical spills, electrical malfunctions, vandalism, theft, etc.
Having insurance is important and it is also a good idea to shop around for favorable rates. Be sure to pay close attention to your deductible amount, and any limitations on the policy.
Fix up your fire-damaged house
The best way to increase the likelihood that you’d get top dollar for your fire-damaged house is to fix it up. Hire a contractor for the big stuff but you can also do some of the other, non-fire-related work to help defray costs.
You do not have to be a trained plumber or carpenter to make your home more attractive to buyers. With just a few tools and some hard work you can give your property a well-maintained appearance.
Create a marketing plan
Like it or not, you usually need to spend time marketing your property in order for it to sell – especially with a fire-damaged house.
What is marketing? Marketing is the creation of a strategy used to sell an item. Research, promotion, advertising and sales are all part of marketing.
Research your local market, and the prices at which comparable houses sell. But remember a fire-damaged house is still going to have a lower sales price compared to similar houses.
Advertising is needed to pull together a large group of interested buyers. By having many parties that want to purchase your property you may be able to create a bidding war which will drive up the sale price. How should you advertise? Use all of your advertising resources, like the newspaper, word-of-mouth, flyers, targeted mailings, special trade booklets, and the Internet.
The Internet is one of the most effective ways to market. There are many real estate investment websites that allow you to post your property with pictures. A comprehensive marketing campaign includes these online marketing tools. Find a site with good traffic and include flattering photos of the interior and exterior of your property. You can consider adding a virtual tour.
If renting out your fire-damaged house, keep these things in mind:
- Have all applicants complete an application. Use this information to conduct a complete background check; review rental and credit history, and talk to their references, previous landlords and employers.
- Use a contract that’s easy to understand and is fair. It should include information about the amount and stipulations of the deposit, under what conditions and how much notice is needed for the landlord to enter the rental, who is responsible for what, etc.
- Do what you say, and more. Keep your tenants happy and chances are they’ll pay the rent. If you’re slow to respond to maintenance requests or don’t keep up the property, they might stop paying rent.
- If a tenant is late with the rent, find out why right away. Encourage them to have the rent paid by the due date by reminding them of the late fee clause in the lease. Keep clear records of payments because you may need this information if legal action were ever required.
- If you do need to take legal action, try to first go through arbitration. Cases are typically handled faster and more efficiently.
Sell to We Buy Fire Damaged Houses
To sell your fire-damaged house in the most stress-free manner possible, you can sell it to We Buy Fire Damaged House. We pay a great price and buy the home in as-is condition. Fill out the form below to get started.