Commercial Real Estate Investing For Dummies, 2nd Edition
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Copyright © 2015 Eric Tyson and Robert S. Griswold. All rights reserved.

Unscrupulous sellers use several tricks to avoid the scrutiny of a thorough and detailed property inspection, so make sure that you're aware of them so that you don't fall victim. One angle is to offer the buyer a warranty or property protection plan that provides repair services for the major systems and appliances of the property. These options are typically only offered for rental homes and condos or small residential properties and aren't acceptable in lieu of an inspection. Actually, these plans don't make much sense at all, because even for a single rental unit or home they cost several hundred dollars upfront, plus there is a deductible of $25 to $100 every time you make a claim.

Or some sellers tell you that they've already had an inspection report prepared — so you don't need to take this step. This assertion is the seller's attempt to control the inspection process while claiming to be interested in saving you time and money by providing you with a copy of an inspection report that they authorized through an inspector of their choice. It doesn't hurt to review this report and give a copy to your inspection team, but never accept a seller's inspection report as your only source of information. When a seller hires an inspector, she may hire someone who isn't diligent or critical of the property. Also, beware of inspectors who are popular with real estate agents. They may be popular because they aren't thorough in uncovering and documenting all the problems with properties.

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Peter Conti is the author of Buying Real Estate Without Cash or Credit. A self-made millionaire, he has mentored thousands of investors. Peter Harris teaches commercial real estate investing to clients across the country.

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