Person purchased a flipped house, seller didn't disclose lack of permits

[Jake]

I found another question I think you guys would be best to answer. And I can see it creating some good discussion. There is a new homeowner who purchased a flipped house, all good there, but after the purchase it was revealed that the seller did not disclose the lack of permits that he had on the property and the work done.

What the new homeowner found, was that the seller failed to disclose there was rehab work done on the property without proper permits. The seller also used unlicensed contractors. There was only a verbal admission from the seller, along with a notice of citation about the permit issue, but the seller did not mention any of this in the disclosure forms originally.

As a result of this blunder, the homeowner is now faced with the chance their home is condemned if none of the permits are taken out by a new deadline. What can the homeowner do in this situation? He feels it's a breach of contract and may need to hire a lawyer. What would be the best course of action here?

You can find the full reddit post/discussion here- r/FirstTimeHomeBuyer

 

[Winny]

I feel awful for the new homeowner. How can people be like this? It's only going to result in problems for you later. Anyway, in this situation, it's probably best to reach-out to a real estate attorney. Make sure it's one that works close in cases involving non-disclosure and or unpermitted work. They should be able to guide you to the appropriate avenues along with legal actions you can take against the seller for breaching his contract. Plus, failing to disclose such critical information is a big one.

As long as you document everything, especially the seller's admission of the unpermitted work, any notice citations, and of course any communications regarding the issue. You will need the evidence to push forward with legal proceeding or any claims you intend to pursue.

The best thing the homeowner can do is make sure to work with a contractor to obtain the right permits and ensure everything complies, especially with building codes. Of course the sad truth, is that the homeowner will likely have to pay out of his own pocket for this, but it's ideal to bring everything up to standard. This also helps you avoid further penalties or worse, condemnation.

 

[Nomad]

First of all, how did the ownership actually transferred to the buyer for the proper that did not have some permits? If the seller sold the property that lacked proper permits, the buyer still has to get permits by paying the fines, however, he can of course take legal actions and get refunded by the seller.

 

[Winny]

First of all, how did the ownership actually transferred to the buyer for the proper that did not have some permits? If the seller sold the property that lacked proper permits, the buyer still has to get permits by paying the fines, however, he can of course take legal actions and get refunded by the seller.

That's a good question. I'm guessing the seller lied about not obtaining the required permits and sold without disclosing it. You'd think it would be tough to sell a property like this, but it seems people find ways.

 

[Bobby McClanahan]

There is a lot of remodel work that can be done without permits, and there is a lot of missing information in this thread, so it's hard to give good answers. Did the buyer use a Realtor? Have a home inspection? Do their due diligence (investigate history of property)? What specific issues are there with the home? ect, ect.

 

[StrictlyUrban]

How awful for the new homeowner. Unfortunately, in my city, the responsibility falls on the buyers. They're expected to ask questions and request proof, or search it out themselves. I don't believe they'd have a legal remedy in this case, unless there was some kind of warranty on the property.

 

[Nomad]

That's a good question. I'm guessing the seller lied about not obtaining the required permits and sold without disclosing it. You'd think it would be tough to sell a property like this, but it seems people find ways.

Maybe be seller lied. But don't you think it was also buyer's responsibility to check all the necessary permits? There are a lot of scams going in the real estate market and the buyers should be very careful. I think the buyer should ask for some refunds as he has to pay for permits including fines.