According to the National Fire Protection Agency, there were home fires in the United States every 87 seconds in 2018. For homeowners, a house fire is one of the most horrific experiences they can face. Even if you and your loved ones are able to get out of the burning building, the blaze’s aftermath may nevertheless leave you with significant emotional, psychological, and financial damages.
Fire is a ruthless force – it destroys treasured memories and causes catastrophic damage to your home. A home fire has a profound effect on people’s lives, and after a fire, you may not want to remain in your burned house anymore.
If you’re trying to sell a fire-damaged house, you’ll need to think carefully beforehand. Here are the most important actions you should do.
Should You Sell Your House After A Fire?
Get The House Inspected
Untrained eyes may not be able to see the full extent of the damage to your home’s plumbing, electrical, and structural systems. A home inspection performed by a licensed professional home inspector is vital when it comes to finding out what repairs are required and how much they’ll cost.
Understand Insurance Coverage
What to do after a house fire? After the fire department puts out the fire, you should first call your insurance company.
Contact your insurance company right away to find out precisely what your coverage is and what actions you may take to begin repairing fire damage. Make sure to ask your insurance agent whether your policy covers extra living expenditures, such as meals or temporary housing, and if there are any spending restrictions. When hiring a professional to repair the damage, you’ll need to ensure that contractors can finish the job before any out-of-pocket payments surpass your insurance policy’s maximum.
Can You Return, Emotionally?
Even after a thorough repair, many people still feel uneasy returning to a fire-damaged property. Some residents have reported still smelling fire and smoke after returning to their renovated house, but the cause of this has not been established.
Should You Repair A Fire-Damaged Home?
Restoration and repair of fire damage in a building are frequently more difficult and time-consuming than you may expect. In addition to being uninhabitable, a badly damaged home is unlikely to sell because of the lack of interest from potential buyers and the inability of conventional lenders to finance it.
Due to extra damage that might occur if your fire-damaged property is left unattended for a long period of time, you will end up paying more money in the long run. Due to the decreased market value, this will make it more challenging to up your asking price for a fire-damaged home.
The price for fire damage restoration varies significantly from one state to another. There will be substantial repairs, but there are things like structural damage that might not be seen initially.
Before the residence can be declared habitable, professionals must clean all the smoke residue. Fire damage restoration is not for everyone because of the time and effort required. The cost of rehab for a fire-damaged home is usually at least $75,000.
This expense is only the beginning; you often need to add another 20% to account for unexpected costs and bring the home up to code. A novice homeowner may find it challenging to deal with a fire-damaged residence and the closing costs of selling it.
Selling A Restored Fire Damaged Home
Restore The Home
A fire restoration business that provides emergency services is the best choice since it means they can respond promptly to your need and get to your property as fast as possible. It would be best if you stopped the spread of fire damage throughout your property as quickly as possible. Working with a fire restoration contractor that also offers renovation services may be a major advantage.
Keep Records
The first step in determining how much you’re entitled to on your insurance claim for fire-damaged personal property is to determine whether your policy covers replacement cost or actual cash value. If you are entitled to replacement cost, the insurance company will reimburse for the amount you spent to replace each item.
You must take depreciation into account if your insurance pays out the real cash value. Obtain the original receipts, bank records, or evidence of credit card transactions, then compute the depreciation of those things appropriately. You can find a depreciation schedule online.
A spreadsheet documenting each item, the depreciation figure, and what the insurance adjuster provided you is preferable. Discuss any disparities you’ve discovered in writing to increase your payment with your insurance adjuster.
Texas Disclosure
One of the questions included in the Seller’s Disclosure in the state of Texas is whether or not you are aware of any “previous fires” in the house. You are required by law to report any previous fires in the home. It does not matter whether the fire was caused by anything mechanical in the property or not, or even whether the damage has been fixed after the fire.
Selling A Fire-Damaged Home As-Is
It is not an easy choice to sell a house destroyed by fire. Selling a house with fire damage with a real estate agent might seem insurmountable for several reasons, including the emotional toll of reliving the painful incident and the financial strain of rebuilding what was lost.
It is possible to restore your house to its pre-fire condition if it is financially viable, however. You may be able to get a personal loan or arrange with your mortgage lender to pay for repair expenses that are not covered by your insurance.
If you’re contemplating how to sell a fire-damaged home, you can either sell it “as is” to an investor for a cash offer, or you can restore it beforehand. “As is” may be the more straightforward answer because the pool of home buyers interested in acquiring a fire-damaged property is relatively tiny.
If the fire damage is confined to a small area of the house, it might make sense to sell it “as is.”
If you’re still asking, how do I sell my fire-damaged house? A real estate investor who will buy houses “as is” and pays cash, and a large insurance payment might be the equivalent of selling your home at fair market value without fire damage. Given that you receive the insurance settlement and you have the certainty of a sale, it would be smart to sell your fire-damaged home rather than deal with the headache of making repairs and paying for them.