The phrase that, ‘when the deal looks too good think twice’ must have emanated from real estate industry. Note that in real estate, there is always a catch when deals that looks too good to be true, especially when it comes to disposal of homes that have been remodeled without permit.
Any property renovated or remodeled without a permit is a ticking time bomb. This is why such homes end-up being comparatively cheaper than their equivalents. As a buyer, you need make thorough investigations on remodeled houses, to avoid getting into the trap hole.
As The New Owner, You Will Be Responsible For Any Unpermitted Works
In many states where it is compulsory to fill disclosure forms, one of the questions enquires whether there has been renovation that required a permit during your tenure as the owner. You will across like “was there any renovations or works that required permits during your ownership?”
It is paramount to disclose any unpermitted works to interested real estate property buyers, to make them aware what they are getting into. This might require that you offer discounts for the buyer.
You Can Be Subjected To Heavy Penalties Due To Unpermitted Work
Sometimes city inspectors may catch up with homeowners that have been involved in unpermitted work. They may order you to ensure the work is permitted; this may compel you to hire experts like architects or making adjustments for codes and so forth.
There are cases where you might be required to demolish the whole project and start all over again. This is a costly exercise especially when you are required by the inspector to remove a whole basement. You may also be required to pay extra taxes in tandem with the square footage difference. You cannot ignore these frequent occurrences as a homeowner.
Insurance Covers Are Unlikely To Cater For Unpermitted Renovations.
In case of damages to the non-permitted section of the building, insurance companies will not compensate you. Since insurance covers, do not include unpermitted renovations. For instance, Insurance companies will subject you to a complex procedure when seeking compensation for someone injured within unpermitted renovation area, which may involve a cumbersome legal tussles.
Mortgage Lenders Might Demand For Immediate Loan Repayments Due To Unpermitted Renovations
If you mortgage lender discovers that you willingly bought a house with unpermitted renovations, they demand immediate repayments because of the risk involved.
What You Need To Know About Unpermitted Work As A Property Buyer
As a buyer, you have a bigger pool of choices to pick from, if come across properties with unpermitted works.
These options include:
Take The Deal
If you get favorable discounts that can favorably cushion you from the risks, then you can make a commitment to buy that home. You can work on making amendments on the mistakes later, and get permits using your money.
Ask The Seller To Fix The Problem
If your get a seller willing to give discounters; this might be an indicator unpermitted works or unwillingness to fix problems. .
Find Another Home To Buy
Like many other buyers in the real estate for sale market, you may not like the tussles that come with unpermitted works. It will prudent to look for properties without permitting issues.