Wayne Turner - (12 MISTAKES) When Buying A Home...

Never, ever, ever buy these types of properties. I promise you, you will regret it every time. I'm going to show you right here in this video exactly what to do, what to look for, what to avoid, who to ask. It doesn't matter if it's your first house or your seventh house. It's going to save you a ton of money, a whole lot of time, and most importantly, a whole lot of stress. So, grab a pen and a piece of paper. You're going to want to take notes. Now, if you subscribe to the channel, thank you so much. I'm more than grateful. My name is Wayne Turner. For nearly 30 years, I've done just about everything when it comes to real estate. I've bought, flipped, sold, built. You name it, I've done it. I've helped thousands of people. And I only share that with you so you can have the confidence and the comfort knowing that what you learn from me is from actual years, decades, if you will, of experience. So, let's jump in.

Number one is buying a house as is. This is where people make a big mistake because they think, well, it says as is, where is. No, you can still inspect the property. However, there are homeowners out there who won't allow you to inspect the property. And if you don't inspect a property, how do you know what you're buying? The last thing you want to do is lay your head on the pillow at night, that first night you're in the house, and all of a sudden you hear creaks and pops and noises. The water heater goes out, the central heating and air don't work, the roof leaks. So you want to get it inspected. Often times they just mean that they're not going to fix anything, but you can still have the property inspected. You just have to ask the homeowner, hey, is it okay if I inspect the property for my own well-being? If they say as is, and even if they say as is, say, you know what, I still want to buy the house, but unfortunately there's a roof leak, and I promise you, 95% of the time they'll say, "Oh, well, I'll fix that." It's just that simple. Now, if you watch any of my videos, when I say it's just that simple, my goal in life is to simplify the real estate process for every single human being on the planet. If you're watching my videos, I want to make it as simple and easy for you to purchase a property, whether it be a house, land, it does not matter, or foreclosure. I want to simplify the process for you.

Number two, and this is a good one, is a survey. You want to make sure you have a survey on the property. It doesn't matter if it's in a neighborhood, it's in an HOA, it's on a quarter-acre lot, a half-acre lot, or five acres of lot. Doesn't matter. The homeowner often times won't do a survey or they may not have a survey. But here's the trick. The surveys are recorded at the Parish Registered of Deeds office, the county registers of deeds. It costs about $2 to get a copy of that. You can go down there and get a copy. Homeowners will say, "I don't have a survey. They never gave me one when I sold the house." That happens a lot. But you can still go there and get a copy of the survey. Now, once you have the survey, you want to walk around the property. You can do this, especially, which is really cool, with a metal detector. You can rent one or buy one for like 150 bucks. You can walk around and find the pins. There are pins marking the property. You'll see all of that in the survey. You'll also know the flood zone from the survey. You walk in the property, you know the metes and bounds. And most importantly, you know if there's anything encroaching upon the home you're about to buy, fences, pools, sheds, anything like that, so you can have the homeowner address it with whoever's encroaching on the property before you buy it.

Number three is the well and the septic. If a property has a septic system and a well, you want to make sure you have those inspected as well. No pun intended. But you see what I'm saying? If the property has a well and a septic system, you want to make sure they work. Never rely on just the homeowner of the property. And most of the time, if a property has a septic system, you have to get a septic letter, a septic certificate if you will, from the county or the parish that says, "Yep, it's working." They have to come out, look at the property, walk around the septic system, and make sure the aerator is working before they'll actually give you a thumbs-up certificate. That certificate is what you have to have to go to the utility company to have the power turned on at the property. So, always get that inspected and make sure you get a septic certificate.

Number four, and I hope you're writing this down, is title policy. You want to make sure you have a title policy on the property, or you get a title policy. The seller may not pay for your title policy, but you can purchase your own title policy. A title policy is going to cover the property from the day you purchase it back until the day you purchase it forward. So, here's what I mean. You have to ask, is there any mortgage liens, back taxes, encumbrances? Do you owe the IRS any money? They may say no, not a problem. Now, when you go to close on that property, they will typically do a title search, especially if you're going to buy title insurance. They're going to do a title search to make sure there are no liens, back taxes, and encumbrances. But if you don't buy a title policy, that person could have had a brand-new central heat and air, brand-new windows put in ten days before your closing, and you don't get a title policy. Well, that seller's gone, and they're going to knock on the door and want the money from you because now you're the property owner. So, you see how important it is. Make sure there are no back taxes, liens, encumbrances, mechanic's liens, or anything like that on the house that you buy. Get a title policy. It's not that expensive, and it gives you peace of mind.

Number five is disclosures. A lot of people aren't aware of this, and homeowners aren't aware, much less buyers. It doesn't matter if it's your first home, second home, or third home. Disclosures are one of those things that started 28 years ago, in 1996, when you had to disclose in writing if there was anything wrong with a property. They put that in writing, and it's required that every homeowner do that, with a few exceptions. For example, if it's an estate property and they inherited it, they don't have to do it because they've never lived in the property. If it's new construction, they don't have to do it. However, if that property is something they've had as a rental property, even though they've never lived in it, they still have to fill out that disclosure. Now, listen, the importance of the disclosure is that it shows you how old the roof is and how old the central heat and air is. Keep in mind some people may put a question mark because they don't know, but at least you'll find a little bit of information on the property. What's the flood zone? Always double-check the flood zone. Has the home ever had a fire? Has it ever had an insurance claim on the property? Has it ever had water? Does standing water collect around the property? Another one is lead-based paint. If the house was built before 1978, you have to have the disclosure to make sure there's no lead-based paint in the house. More than likely, it's been painted over in 40-plus years, but you still have to sign the document. It's required by law.

Number six, and this has happened to me. Is this good stuff? If it is, give me a thumbs up. Let me know you're liking this video. Number six happened to me. I bought a house, and I had no idea it was in a flood zone until literally the day before closing. The disclosure said it wasn't in a flood zone, and I went off the word of the homeowner. Never go off the word of the homeowner, because if that property is paid off, if it was inherited, if they've never had a mortgage on the property and never had to carry flood insurance, they may say, "No, it's not in a flood zone," and come to find out it is. And of course, there are zones A, B, C, and X. The worst being A, X, and C. It's not required by the mortgage company, but you just need to know that going in. So when you see on that disclosure that it says, "Oh, well, it's not in a flood zone," or it's in flood zone X or flood zone C, you still want to verify that. You can go to the government flood maps, and they will show you, based on that property address, what flood zone, if any, that property is in.

Number seven, a lot of people miss this one, and it's insurance. You don't just get an insurance quote. You have to ask the homeowner how many insurance claims have been made on the property. They may say none, not at all. But you have to verify that. Have there been any insurance claims? Oftentimes, if there are a lot of insurance claims on a property, for example, a tree fell on it, six months later it was struck by lightning, and then we had a kitchen fire, believe it or not, that makes it really, really difficult to get insurance on that property. And even when you can get insurance, it's pretty expensive. So always, always, always ask: has there ever been any insurance claim on the property? And if so, what was it related to, and how many were there?

Number eight is closing costs. Closing costs include your insurance, your origination fee, and your title policy. Those upfront fees have to be paid. I can't tell you how many times a homeowner has said, "Wayne, I'm not paying for the buyer's closing costs." I'm like, "Why wouldn't you pay for the buyer's closing costs?" They said, "The buyers can pay their own closing costs." I'm like, "Well, listen, prime example: if they offered you 195 in cash, would you sell it for 195?" "Yeah, take it all day long." "What if they offered you 200, and they had to get a mortgage, but they asked for 5,000 in closing costs? You're still going to net 195. Would you sell it then?" They say, "Yeah, absolutely." I said, "Well, listen, you don't want to rule out closing costs, because that allows that many more potential buyers to get into the property." Oftentimes you're buying a property and you're thinking, "Well, look, I want to make improvements to the property. I want to buy furniture, and I just don't want to deplete all my cash." Closing costs always run around three and a half percent of your loan amount. That means you can purchase a house, and all you need is your down payment.

Number nine, a lot of people don't realize they can actually purchase a pre-existing house and get a warranty on it. I always suggest people get a warranty on the house. Some people say, "Oh, they're not worth anything." I can tell you, I've had them on rental properties, personal homes, everything. I like them, and here's the reason why. If that house is more than five or six years old, you don't know how old that unit is. You can have the unit inspected, and it doesn't matter. They can say it's fine, and all of a sudden it's leaking tomorrow. Instead of having to replace a $6,700 condenser or compressor, you pay a $100 fee. They come out, they replace it, and it's as simple as that. It gives you peace of mind. This is really important for first-time homebuyers, but even for experienced buyers. I have been buying properties for 30 years, and when I buy a property, whether it's an investment property or not, I still put a warranty on it, because 95% of the time the seller will pay for the warranty for you. It's only about $800. If they won't pay it, you can simply pay it yourself.

Number ten is mineral rights and water rights. A guy texted me the other day and said, "Wayne, I'm at the closing table, and the seller says they're not relinquishing the mineral rights to the property." I'm like, "Well, you don't have to buy the property, but you have to make sure that was not a contingency in the contract." See, if you agree to buy the property and then the seller keeps the mineral rights, but you didn't read the fine print, then you're up the creek without a paddle. Here's what can happen. If you don't buy the property, you can lose your deposit. You can also be sued for specific performance of the contract. Listen, when it's an agreement, it doesn't matter if it's a real estate agent, a real estate broker, or you bought it yourself by owner. It's a legally binding contract between two people, and you can be sued for specific performance of the contract. That's why you want to go over everything, everything, everything, and make sure you get your mineral rights, because the last thing you want is somebody pulling up in your driveway, sending you a certified letter that they're going to start drilling on your land and fracking for natural gas.

Number eleven is get approved for a mortgage. You want to make sure your finances are in order if you're not paying cash. And you want to ask the mortgage lender, what's the best loan program? Is it FHA? Is it VA? Do you serve in the military? Is it conventional? How much money do you have to put down? You may want to go conventional, but I can't tell you how many times it's happened where a homeowner says, "Wayne, I'm not paying closing costs, I'm not doing FHA, and I'm not going VA." And I'm like, "Why?" They can't tell me why, but they heard a horror story from Larry at work about the inspection. I've seen them, I get it. But here's what happens. If that house is in decent condition, with no busted or broken windows, no chipping paint, or anything like that, then it will pass FHA and VA inspections. If that's the type of loan you're getting, don't let a homeowner interfere with that. Educate them a little bit, explain why, and have them explain to you why they won't let it go FHA or VA. Oftentimes, some homeowners are a little more difficult to deal with when they're selling their property themselves. So you just have to ask those questions and be patient. It's not that you can't get a good deal. You just have to know what to ask and what to avoid.

Number twelve, and this is really important: you have to put in writing, between you, the buyer, and the seller, what's going to stay with the property. Oftentimes they'll say, "Well, we're going to leave this and we're not going to leave that." If it's not in writing, it doesn't happen. So if you want the washer and dryer, you have to ask for it. If you want the refrigerator, you have to ask for it. You have to ask for those things. You also have to know that if you're getting a mortgage, you can't put the boat in the contract or the tractor in the contract. Those are things that do not give any monetary value whatsoever. A washer, dryer, and refrigerator are borderline. But make sure light fixtures, chandeliers, anything like that, pool equipment, attached radio speakers, all of that is in writing so you don't have the headache after closing. I've seen it happen where sellers have taken the window curtains, the drapes, the blinds, the speakers, and the light fixtures. You don't want that to happen.

If you've liked this video, be sure to give me a thumbs up, subscribe to the channel, and hit that little bell button. I promise there are some great videos with lots of learning and education. I love teaching people. I've learned so much, and my philosophy in life is you learn it, you master it, and then you teach it. Until next time, make it a great day. God bless you.