Posted on: 17 May 2016
When you buy a home, there are a host of problems that you can encounter. A common one that is found is that an addition to the home, such as a bedroom, was illegally constructed without the proper permits from the municipality. The discovery of an illegal addition does not mean that the sale is off, but it could spell trouble for you in the future if you do not handle the situation before closing.
What Are the Risks of Buying the Property?
Housing construction permits are in place to ensure that additions to the home meet the safety codes established by the municipality in which the home is located. If you buy a home with an illegally constructed addition, you might be forced to tear down the addition at your expense.
You could also have trouble with getting financing for your home. It is likely that the home inspector or appraiser will notice that the addition is illegal. Home inspectors are trained to look for signs that an addition was not constructed according to housing code standards. Once the lender is aware of the illegal addition, they could decide to rescind their offer to finance the home.
If you are able to get the illegal addition past the lender, you might have trouble getting insurance coverage for your home. If anything occurs on the property and you do not have coverage, you could potentially face a lawsuit.
What Can You Do?
The obvious answer to avoid all of the risks associated with purchasing a home with an illegal addition is to just not buy it. However, if you want to buy the property, your real estate lawyer can take steps to make the sale possible.
One option is for your lawyer to negotiate with the seller. The seller could agree to obtain the necessary permits for the illegal addition prior to the sale of the home. If the home is not up to code, your lawyer could ask the seller to make the necessary renovations to bring it into compliance with the housing code standards.
Another option is to continue with the purchase of the home, but tear down the illegal addition. Your lawyer can work out an agreement with the seller to cover all or part of the cost of the demolition work and the construction necessary to correct any structural or cosmetic problems that result.
If you do agree to continue the purchase of the home, ensure that the arrangement between you and the seller is included in the closing documents, including the disclosure.
For more information, contact a local firm like Heil & Saylor.Share