What Can You do when You've Purchased a Money Pit?

Buying the wrong house can be mentally and physically exhausting, but there are ways to cope with a money pit. After graduating college, you might be excited to get your first real job and purchase your own home. But if you rush the process, you risk buying a home that drains your finances. Not due to the mortgage payment, but because the property needs a lot of work. Fortunately, there are ways to cope with a money pit.

1. Calm down

Staying calm is one of the best ways to cope with a money pit. At first, you may be frustrated and angry. Your feelings are justifiable. But if you let emotions get the best of you, it'll be harder to stay focused and determine the best move. Think of the situation as a minor setback. You may not have the ideal house today, but you will with a little time and effort.

2. Assess the Damage

Determine areas in the house that need improvement. If you're upset and frustrated, you may feel that everything in the home is falling apart. However, if you hire an experienced contractor to assess the damage, the situation might not be as bad as you think.

3. Get Quotes

Fixing up a money pit takes a lot of time and money. And if you recently purchased the house, you probably spent most of your cash on the down payment and closing costs. For that matter, you need to work with a competent, yet affordable contractor. Don't hire the first person you speak with. Contact multiple companies and request a free quote. Plus, getting second and third opinions can help you make an informed decision.

4. Go after the Seller

Depending on the laws in your state, home sellers may be required to disclose information about properties, such as hidden problems or past damage. If you feel that the seller withheld important information, speak with an attorney to determine if you have a case. These cases are difficult to prove, but an experienced attorney can walk you through the process and help you receive compensation if the seller’s at fault.

5. Take It One Repair at a Time

Understandably, you want your dream home today. But home repairs take time. So, be patient with your contractor. Depending on the amount of work needed, it can take several months or longer to improve the condition of your home.

6. Prioritize

If the home needs a lot of work, knowing where to begin can prove challenging. As a rule, start with the most important repairs. You might be eager to renovate the kitchen or bathrooms and modernize your space. But if the roof is leaking or if the house has electrical problems, you'll need to address these issues first, or else deal with bigger problems in the future.

7. Keep Your Head up

It’s difficult to stay positive, especially when home renovations don’t always go according to plan. The project might take longer than anticipated, or the contractor might run into problems that increase the cost of the improvements. These issues are simply part of the construction process. Don’t let setbacks discourage or steal your excitement.

Just about every homebuyer fears buying a money pit. To reduce your chances, always request a home inspection before closing on a property, and if you have a bad feeling about a property — move on. What are other ways to cope with buying a money pit?