I n Chapter 10, I gave you step-by-step instructions on how to perform due diligence on a property and its owner. In this chapter, you are going to learn how to thoroughly inspect a property to determine its physical condition before you ever shell out any money on a real estate option. The reason I am so adamant about having a property inspected before I ever plunk down any of my hard-earned money for an option is that I do not want to get bamboozled by an unscrupulous owner, who just happens to be an expert at surreptitiously masking a property's defects. At least once a week, I get a telephone call or e-mail from an investor who failed to heed the very sage advice that I am dispensing here and went ahead and blindly bought a property without the benefit of an inspection. And every time I hear the same old tale of woe about how the poor investor got swindled by some shady property owner into buying a lemon of a property needing costly and time-consuming repairs. My first, last, and only question to these people is always the same: Did you have the property inspected by a licensed professional building inspector? Invariably, the answer is always the same: "No," followed by a litany of lame excuses, ranging from, "I did not have time," to, "The owner seemed like such a nice person." I do not know about you, but I have a real hard time feeling sorry for anyone who conducts his or her business affairs in such a slipshod manner. Years ago, there was a doctrine in real estate known as caveat emptor, which is Latin for "buyer beware." And buyers were continually warned to be on their guard when participating in a real estate transaction. However, nowadays, in our society, where the overwhelming majority of citizens would rather play the blame game than accept responsibility for their personal actions, the concept of looking out for yourself has pretty much gone by the wayside. Well, I, for one, still apply the principle of caveat emptor whenever I am involved in any type of transaction, and unless you still believe in the tooth fairy, you, too, must thoroughly inspect any potential option property for the following:
1. Structural roof damage.
2. Sinking and cracking foundations.
3. Mold contamination.
4. Electrical, fire, and safety hazards.
5. Structural dry rot damage.
6. Water and moisture intrusion.
7. Collapsed water and sewer lines.
8. Signs of termite infestation.
9. Missing roofing material, gutters, and downspouts.
10. Rotting wood.
11. Stripped mechanical systems and missing electrical wiring.
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