Unpermitted remodel

incrediblehau

New member
Is it a bad idea to buy a home with unpermitted renovations.


Two bathrooms with plumbing and electrical reshuffling was done, no additional sq ft added.

Is there a way to go through with escrow, then go to the city for permitting and if the work was not up to code and require extensive revamping to go back k to the seller if the amount of repairs exceed ?X? amount of dollars
 
Yes, bad idea. If you live in HOA, I assume you have to get the hoa approval. Since it sounds like they changed the design of the layout. (Plumbing and electric) Idk

When the city inspector looks at it they might make a person redo the work or show that it safe. (For example: Remove the dry way to show the electrical. For the area that was changed.)

 
incrediblehau said:
Is it a bad idea to buy a home with unpermitted renovations.


Two bathrooms with plumbing and electrical reshuffling was done, no additional sq ft added.

Is there a way to go through with escrow, then go to the city for permitting and if the work was not up to code and require extensive revamping to go back k to the seller if the amount of repairs exceed ?X? amount of dollars

Anything can be negotiated, but normally a seller is not going to agree to be held liable for something after closing.  Your best bet is to use it as negotiating leverage; Either demand that the seller get permits or ask for a discount to offset your risk.  In today's market, the seller may not agree though.
 
incrediblehau said:
Is it a bad idea to buy a home with unpermitted renovations.


Two bathrooms with plumbing and electrical reshuffling was done, no additional sq ft added.

Is there a way to go through with escrow, then go to the city for permitting and if the work was not up to code and require extensive revamping to go back k to the seller if the amount of repairs exceed ?X? amount of dollars

Tbh: I don?t know if it is something small like adding sprinkler system in the backyard or a complete makeover since you said plumbing and electrical.
 
Made one bathroom smaller, extended the masters bathroom, and made a walk in closet. Masters bathroom has shower/tub, toilet, and sinks moved. Definitely requires a permit imo

I am still interested in the property and as far as I know, guy still wants to sell.

 
Liar Loan said:
incrediblehau said:
Is it a bad idea to buy a home with unpermitted renovations.


Two bathrooms with plumbing and electrical reshuffling was done, no additional sq ft added.

Is there a way to go through with escrow, then go to the city for permitting and if the work was not up to code and require extensive revamping to go back k to the seller if the amount of repairs exceed ?X? amount of dollars

Anything can be negotiated, but normally a seller is not going to agree to be held liable for something after closing.  Your best bet is to use it as negotiating leverage; Either demand that the seller get permits or ask for a discount to offset your risk.  In today's market, the seller may not agree though.

What?s a fair ?X? amount to negotiate?

The worst case scenarios are obviously if the city doesn?t grant a permit or the inspector comes and says the work is bad and we have to redo a lot of stuff.

Is the city more lenient with remodels that have occurred from prior homeowners?
 
Just found out from selling party that he has no drawings/plans/pictures/diagrams of the work that was done.

He has an invoice listing the work that was done. I do not think this is sufficient to get a permit pulled.

What are my options to rectify the situation given my circumstances.

 
incrediblehau said:
Just found out from selling party that he has no drawings/plans/pictures/diagrams of the work that was done.

He has an invoice listing the work that was done. I do not think this is sufficient to get a permit pulled.

What are my options to rectify the situation given my circumstances.

Tell him to get it permitted.
 
eyephone said:
incrediblehau said:
Just found out from selling party that he has no drawings/plans/pictures/diagrams of the work that was done.

He has an invoice listing the work that was done. I do not think this is sufficient to get a permit pulled.

What are my options to rectify the situation given my circumstances.

Tell him to get it permitted.

That could take months.  Another option is to do a holdback of net seller proceeds until the permits are obtained, that's good incentive for the seller.
 
I had a cancelled escrow where the buyers discovered unpermitted work was done on the home they had under contract. The seller knew of the unpermitted work and even had a "hold back" from the previous seller when they bought. These held back funds were to bring the work to city code but was never done. To this day, roughly 3 years have passed and those funds remain in an escrow account with no clear way forward to "legalize" the property.

The current owner of the property is now litigating against the knucklehead contractor who performed the work for the previous seller. No news if the $$$ still held back is going to be deployed to fix the issue. Sheesh, imagine putting those funds into FANG stocks 3 years ago.... 

The moral of this story - Avoid buying a property with permit issues unless you have the time, money, and expertise to cure.

My .02c
 
USCTrojanCPA said:
eyephone said:
incrediblehau said:
Just found out from selling party that he has no drawings/plans/pictures/diagrams of the work that was done.

He has an invoice listing the work that was done. I do not think this is sufficient to get a permit pulled.

What are my options to rectify the situation given my circumstances.

Tell him to get it permitted.

That could take months.  Another option is to do a holdback of net seller proceeds until the permits are obtained, that's good incentive for the seller.

Just giving him an option. Tbh, I am doing the buyer a favor.
The buyer can say the seller must remedy all unpermitted construction as a condition of the sale.

 
What happens if the work never gets permitted? Are there fines that the city imposes or does life just go on?
 
zovall said:
What happens if the work never gets permitted? Are there fines that the city imposes or does life just go on?

No city fines typically, just no adjustment to the county records for bedroom/bathroom/SF count.
 
i appreciate everyones feedback

spoke to someone from the city who said since no plans are availible, i'd have to hire an architect or a structural engineer to come up with the plans. called a structural engineer who says they charge $1,200 for an inspection (not including drawings).

i want the house, the seller doesn't care to get his work permitted, so its pretty much take it or leave it kind of deal  :-\
 
Why You Need to Check for Unpermitted Work Before Buying

People go through lawsuits, insurance nightmares, expensive repairs, penalties, and teardowns of an entire section of a house -- all because a prior owner did unpermitted work on the home.

You buy the home and five years later have a problem with the electrical and a minor fire in the unpermitted room. The electrical wiring is deemed not up to code, and thus, insurance refuses to cover the fire damage.

if you buy a house with unpermitted work and a city inspector catches it somehow, you become liable for retroactive permitting, paying penalties, or getting rid of the unpermitted work.
https://www.fool.com/millionacres/r...s/why-you-need-check-unpermitted-work-buying/

Good luck

 
incrediblehau said:
i want the house, the seller doesn't care to get his work permitted, so its pretty much take it or leave it kind of deal  :-\

I think that is the reality of the situation in this market.
 
zovall said:
incrediblehau said:
i want the house, the seller doesn't care to get his work permitted, so its pretty much take it or leave it kind of deal  :-\

I think that is the reality of the situation in this market.

And be stuck with the permits and potential nightmare. No thanks
 
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