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Old 10-21-2007, 09:33 PM
 
3 posts, read 23,174 times
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I am interested in buying a town house in Mt Laurel NJ. This house has a finished basement. The owners, however, did not get a permit when they finished the basement. My questions are
1) Is the property tax going to increase after I buy this house ?
2) Let's say fire catches this house and the cause is bad wires in the basement, is home inusrance going to cover the repaire or not since the work in the basement was not inspected.

Thank you for your help
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Old 10-21-2007, 09:49 PM
 
692 posts, read 1,707,701 times
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Quote:
Originally Posted by matary View Post
I am interested in buying a town house in Mt Laurel NJ. This house has a finished basement. The owners, however, did not get a permit when they finished the basement. My questions are
1) Is the property tax going to increase after I buy this house ?
2) Let's say fire catches this house and the cause is bad wires in the basement, is home inusrance going to cover the repaire or not since the work in the basement was not inspected.

Thank you for your help
You will be best served by speaking with both an attorney and a property-casualty insurance expert. A very similar situation happened to me when I was buying a house -- finished basement and no permits for any of the work (pre-during-post). First, the attorney told me to pass. Second, the home inspector and the P-C agent told me to pass. Third, an architect/developer/construction friend told me to pass.

Needless to say -- I passed. The house stayed on the market. The price dropped and dropped. The house never sold. The taxes would and should go up upon re-assessment -- which would of course happen if they/you tried to get permits, CO, etc. Getting permits after the fact is very, very painful.

The P-C agent told me there could be complications with a potential claim. Very hypothetical conversation, innumerable what-if's, etc. Work done without permits, perhaps not up to code, etc. -- the situation can start out bad, and can get worse. Good luck.
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Old 10-21-2007, 09:50 PM
 
692 posts, read 1,707,701 times
Reputation: 157
Quote:
Originally Posted by matary View Post
I am interested in buying a town house in Mt Laurel NJ. This house has a finished basement. The owners, however, did not get a permit when they finished the basement. My questions are
1) Is the property tax going to increase after I buy this house ?
2) Let's say fire catches this house and the cause is bad wires in the basement, is home inusrance going to cover the repaire or not since the work in the basement was not inspected.

Thank you for your help
By the way -- do they have a bedroom in the basement? That's an entirely different issue. Let the home inspector tell you about that (egress windows, other requirements, etc.).
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Old 10-21-2007, 11:22 PM
 
Location: Nashville, TN
2,866 posts, read 6,192,901 times
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Quote:
Originally Posted by matary View Post
I am interested in buying a town house in Mt Laurel NJ. This house has a finished basement. The owners, however, did not get a permit when they finished the basement. My questions are
1) Is the property tax going to increase after I buy this house ?
2) Let's say fire catches this house and the cause is bad wires in the basement, is home inusrance going to cover the repaire or not since the work in the basement was not inspected.

Thank you for your help
They would need to get a CCO to complete the sale of the house. The town needs to approve it, in order for the house to be sold. My guess is that the taxes will increase with a finished basement as there would be more liveable Sq Footage.

Diane
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Old 10-22-2007, 07:45 AM
 
222 posts, read 679,260 times
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I think in some towns they can still sell it if the buyer agrees to no cert of occupancy. But then when you sell it, you'll have the same problem. If you buy it, you need to get everything permitted and inspected. Worse case scenario is that you buy it and then have to rip everything out of the basement and start from scratch. That's a pretty bad scenario if you ask me.
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Old 10-22-2007, 07:54 AM
 
9,125 posts, read 23,811,524 times
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In most towns in NJ, the pre-sale inspection by the town is simply for smoke detectors, fire extinguishers, etc.- they aren't doing a full Certificate of Occupancy inspection that would identify code violations. The only way the taxes will go up due to the improvements (they'll go up anyway regardless....lol) is if the town re-assesses and the tax assessor's staff visits the house.

As far as insurance claims, I'd say if you truly know that the work was done without permits, there could be an issue with a claim. But if you were buying a house and didn't know whether the work did or didn't have permits pulled, how can that be your problem? I mean, over the course of 50 years in a house, I can imagine that tons of work was done without permits, and how would you know what was or wasn't?
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Old 10-22-2007, 08:39 AM
 
Location: Nashville, TN
2,866 posts, read 6,192,901 times
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Quote:
Originally Posted by BobKovacs View Post
In most towns in NJ, the pre-sale inspection by the town is simply for smoke detectors, fire extinguishers, etc.- they aren't doing a full Certificate of Occupancy inspection that would identify code violations. The only way the taxes will go up due to the improvements (they'll go up anyway regardless....lol) is if the town re-assesses and the tax assessor's staff visits the house.

As far as insurance claims, I'd say if you truly know that the work was done without permits, there could be an issue with a claim. But if you were buying a house and didn't know whether the work did or didn't have permits pulled, how can that be your problem? I mean, over the course of 50 years in a house, I can imagine that tons of work was done without permits, and how would you know what was or wasn't?
Bob in Manalapan, they go furthur than smoke dectectors. I had to get a permit for a shed that was put there by the previous owners over 13 years priar. They also required me to put rails on the deck that were not there priar to my buying. The town did not even require cco's when I purchased the house. I'm sure that this is true of other towns also. I know Marlboro does the same. He would have to check with the individual town to see what they require, since there are exceptions. I was told by a realtor that Middletown is even strictor than Manalapan, so things are changing.
I think a House inspector needs to check if the work was done correct, someone that knows what they are doing electrial wise. I had to redue and have disconected all types of outside wiring that my seller did themself in NJ as it was faulty. Now, that would have been picked up, when they did the CCO.
Diane
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Old 10-22-2007, 08:53 AM
 
Location: Atlantic Highlands NJ/Ponte Vedra FL/NYC
2,689 posts, read 458,421 times
Reputation: 328
Quote:
Originally Posted by BobKovacs View Post
In most towns in NJ, the pre-sale inspection by the town is simply for smoke detectors, fire extinguishers, etc.- they aren't doing a full Certificate of Occupancy inspection that would identify code violations. The only way the taxes will go up due to the improvements (they'll go up anyway regardless....lol) is if the town re-assesses and the tax assessor's staff visits the house.

I have no idea on what you base your comments on, most towns I am familiar with will check for code violations and will not issue a co for a place with illegally done renovations, and will demand that any code violations be corrected before issuing a new co.
As for taxes being reassessed, when the building permit is pulled, the job is completed, a final inspection is made and a new co is issued the assessor has the option to reassess the property.
If I remember correctly you're from around rahway, and maybe things are done differently there, I guess lax code enforcement accounts for the poor condition of the housing in many towns in union county.

to the OP you must put in the contract that the house will get a co or walk from the deal
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Old 10-22-2007, 09:37 AM
 
692 posts, read 1,707,701 times
Reputation: 157
I recently had some closings, all in Bergen County. First, where I was the seller, the town required an inspection -- smoke, carbon monoxide, a few other items, etc. and as a result a CO was issued. Whatever the reason, that was the town's requirements.

The other, where I was the buyer, was more interesting. No town inspection required. No CO required. Nothing required. Again, for whatever the reason.

I've seen where the town requires a full inspection, and issues a CO, and I've also seen where nothing is required. Of course there are points in between as well. As a buyer, I would not let the town dictate what you should or shouldn't do, or what you could and could not do. Take advantage of every level of inspection, protection, etc. You would rather be extremely safe than slightly sorry. Good luck.
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Old 10-22-2007, 11:29 AM
 
9,125 posts, read 23,811,524 times
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Quote:
Originally Posted by apvbguy View Post
I have no idea on what you base your comments on, most towns I am familiar with will check for code violations and will not issue a co for a place with illegally done renovations, and will demand that any code violations be corrected before issuing a new co.
As for taxes being reassessed, when the building permit is pulled, the job is completed, a final inspection is made and a new co is issued the assessor has the option to reassess the property.
If I remember correctly you're from around rahway, and maybe things are done differently there, I guess lax code enforcement accounts for the poor condition of the housing in many towns in union county.

to the OP you must put in the contract that the house will get a co or walk from the deal
Actually, Rahway is one town near where I was that DID go beyond the smoke detector inspection and actually writeup code violations. I sold homes in both Woodbridge and Edison, and Woodbridge checked smokes, fire extinguisher, and sump pump discharge to the street, and Edison checked only smokes. There are several other towns that people I've known have sold in that have had similar inspections- Rahway was the only one in the area that had an extensive inspection.
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