What Does It Mean To Buy "As-Is"?

When a property is advertised “as-is”, this typically indicates that the seller is not willing to warranty the property. The buyer will need to accept the property in its present condition, and will have to be responsible for any repairs.

Foreclosures are usually sold “as-is”, because the lender, who is now selling the property, has little or no knowledge of its condition. Occasionally, an “as-is” sale is the result of a death, and is being liquidated as part of an estate. A buyer may have the opportunity to acquire an “as-is” property at an excellent price, if he or she is willing to tackle the necessary repairs and remodeling.

A thorough inspection would certainly be in order before making an offer on a property of unknown condition, one with absolutely no warranty involved. With a complete and competent inspection, a buyer will be able to decide if the sale price is low enough to compensate for the amount of repair and remodeling that will be necessary to bring the property up to the desired state.

If all of the remodeling and repairs will have to be subcontracted, it may not be a good investment. If, on the other hand, the buyer has the necessary skills to do much of the work, an “as-is” property can be a great buy. Be certain to check with your lender to determine the loan amount available on such a property. You will need to consider many factors in addition to the condition of the home, including the size of the lot and the location of the property.