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I agree with azzurrony. If a reliable inspector is able to pass the addition, having no COs is not a big deal. Few banks are thorough in their homework concering COs, and the savings in taxes will pay for the CO many times over in a few years. A lot of homes I looked at last year had atleast one 'illegal' addition - finished basement without a CO, bathroom without a CO, deck without a CO etc.. and the homeowners clearly told me that they did not want to get a CO for the deck since they were afraid their taxes will go up.
C of O's are generally money making machines for the Town or Village. It's a scam for the most part unless you are talking about a complicated electrical wiring system or a major structural extension.
If someone had a licensed plumber put in a nice bathroom without a permit, maybe they did so to avoid major property tax increases. Not every renovation without a CO was done to scam people.
I'm not a CO Nazi. I think if you like the house and you plan on staying there for a long long time, then have a qualified inspector take a look at the work. If it is sound, then don't worry about the CO's. You'll have a nice house without all the tax headaches.
Now, if you think your bank will nitpick an extra bathroom, then fine, you might want to move on. But if not, I'd consider the house.
Another problem is time. It will take a minimum of 6-8 weeks to get the CO approved if everything is done to code. Most banks will not make the loan unless the CO is in place, so it may take 2-4 months for the whole process. The current homeowner also needs to be the one to apply for the CO's and if they are not willing to start the process, there is nothing you can do. You can't make repairs to a house that you don't own yet. So you would have to draw up contracts to ensure that you are not getting ripped off for any repairs that need to be made. I had a similar decision to make about a house that I had an accepted offer on, and I decided to walk away. Too many unnecessary headaches.
Another problem is time. It will take a minimum of 6-8 weeks to get the CO approved if everything is done to code. Most banks will not make the loan unless the CO is in place, so it may take 2-4 months for the whole process. The current homeowner also needs to be the one to apply for the CO's and if they are not willing to start the process, there is nothing you can do. You can't make repairs to a house that you don't own yet. So you would have to draw up contracts to ensure that you are not getting ripped off for any repairs that need to be made. I had a similar decision to make about a house that I had an accepted offer on, and I decided to walk away. Too many unnecessary headaches.
A good expediter familiar with the local Town can cut down the time, but it won't happen overnight...
In this lending environment, COs (or the lack thereof) can break deals
C of O's are generally money making machines for the Town or Village. It's a scam for the most part unless you are talking about a complicated electrical wiring system or a major structural extension.
If someone had a licensed plumber put in a nice bathroom without a permit, maybe they did so to avoid major property tax increases. Not every renovation without a CO was done to scam people.
I'm not a CO Nazi. I think if you like the house and you plan on staying there for a long long time, then have a qualified inspector take a look at the work. If it is sound, then don't worry about the CO's. You'll have a nice house without all the tax headaches.
Now, if you think your bank will nitpick an extra bathroom, then fine, you might want to move on. But if not, I'd consider the house.
The problem with this approach is that once you close it is your problem. When you go to sell, the next buyer may not be as forgiving as you and then it will be up to you to get the CO. In today's market, there is absolutely no reason to buy a home that is not completely legal.
The problem with this approach is that once you close it is your problem. When you go to sell, the next buyer may not be as forgiving as you and then it will be up to you to get the CO. In today's market, there is absolutely no reason to buy a home that is not completely legal.
Tom,
I definitely understand this. That's why I said my approach works when you are going to be there for the long haul. The amount you will save in taxes (plus the time value of money) in the long term will more than make up for some potential headaches down the road. And, I say "potential" because the lending market may look very different in 20 years and may not be as picky.
Again, this approach is for relatively modest work...a finished basement, an extra bathroom, an upgraded electric box, etc. I wouldn't recommend this if there is a major extension that doesn't have a C of O.
I definitely understand this. That's why I said my approach works when you are going to be there for the long haul. The amount you will save in taxes (plus the time value of money) in the long term will more than make up for some potential headaches down the road. And, I say "potential" because the lending market may look very different in 20 years and may not be as picky.
Again, this approach is for relatively modest work...a finished basement, an extra bathroom, an upgraded electric box, etc. I wouldn't recommend this if there is a major extension that doesn't have a C of O.
The lending market will only become more onerous as time passes due to the numerous banking regulations being proposed/passed. The wild west syndrome that occurred in the past five years will not be forgotten by bankers. Bankers want their money back!
From my personal experience....
Unless you know exactly what the unconditional CO is for and what is involved.... ask the seller to get it for you before you close (make sure you make it time sensitive so that they expedite it).
You will know if they are ready for it or not. If they refuse, then move on.... do not be pulled into the house so early in the process.
Couple of points.... they will not get the CO unless they have to, so it will be tough to tell them to get the CO before going under contract. What the heck, if they still agree, then its good for you.
Also, be prepared to lose some sleep and add some processing time to your home purchase timeline if you do decide to go under contract. This is especially true when it comes to rate locks and mortgage commitments expiring....
Getting a house without a co is not easy to get rid of it later. Do not buy a property that is not legal. If you do buy the house, then you inherit a problem and the house must be sold for cash only. It's great not to pay taxes and live in a bigeer house, but why would you buy a house that is not legal? Why would you take over the seller's responsibility. If after all is said and done, you still want the house, make sure you let the seller know that you are aware of the problem and to lower his price since you are going to end up with his problems. Call the architect, he'll tell you how much is going to cost. Then you can make up your mind.
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