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COs are not that hard to get. Just have buyer put the money into escrow. My house was lacking a CO for a dormer, bathroom and deck. Only issue was I spent like 100 hours getting it all done but I paid all fees and inspections out of escrow. I had the exact amount in escrow to cover fees plus tear out one bathroom as my inspector was not sure it was to code.
I got like 15k off house for headache. So I got paid $150 an hour to do the 100 hours worth of work.
It is not a deal breaker, but remember you are taking on work.
And remember, taxes only go up on owner of a house who does work. Your tax is based on what you paid. The addition adds no value to new owner as you paid full market price.
That is reason current home owners dont file permits but new homeowners should as you have nothing to lose and everything to gain as your problems down the road are solved
Walk away from any home that doesn't have all the COs for permanent structures (or where owners are refusing to get them). While I would bet most taxing authorities on Long Island are fairly lenient with innocent owners, the building departments do have the authority to make you rip out all the work and pay hefty fines. Why would anyone in their right mind want to take on that liability in buying a new home, especially if you were already paying market price for it?
Yes, you can put money in escrow and close without all of the COs. But how much money? Total up the worst case scenario and you could be talking well into the five figures. Plus, why would you let the lazy sellers off the hook?
I told my sellers there would be no deal without the CO for a finished basement and bath. They took the necessary steps and had all approvals in hand before closing. That's the way it should be.
I saw a decent house, with no updated CO for a new bathroom and a paritally converted garage.
Was going to put an offer, but the owner refuses to update the CO. I'm assuming the seller is waiting for an all cash buyer, which is why the house has been sitting there for over a year. Screw them, I'm off to the next house.
How does a buyer write the phrase in an offer letter indicating that the offer is subject to all possible required certificates (CO, CEU) being obtained and updated by the seller?
Everytime I ask a broker during a showing if all certificates are in order, they say "yes" but the posts here suggest that a lot of houses don't have all the required certificates updated.
It seems like certificates can be required for just about anything in a house. Makes it tempting to just buy a Toll Bros home.
In my case the listing agent was honest that the CO was not updated, and that the seller had no intention of updating it.
Otherwise, you can always look up the house on property shark- and if it doesn't match up (i.e. number of baths, patio, etc), you can assume they never got permits/co for any renovation.
You can write that phrase in the offer, but its non-binding. You and your lawyers can negotiate over getting COs while under contract, but I learned its better to just not put an offer in the first place for anything without full CO.
Something is probably not up to code, that may be the reason they don't want to deal. Same thing happened when I bought my home. Several things, no CO. The title came up and surprised all parties involved. We took care of it, but old owner paid for everything. Cost an arm and a leg Bc a lot of things were not up to code. Old owner left a large amount in escrow .
My seller had very valid reasons why he didn't want to get involved with the process. Your seller just didn't want to be bothered.
And remember, taxes only go up on owner of a house who does work. Your tax is based on what you paid. The addition adds no value to new owner as you paid full market price.
That is reason current home owners dont file permits but new homeowners should as you have nothing to lose and everything to gain as your problems down the road are solved
This is peculiar to me. Taxes are based on the assessed value of the home which can be adjusted at any point even in the future. If they reassess like I know they will for 2015-2016, they will see it now officially lists, say, an extra bathroom and undoubtedly you will be taxed on it because the value of the house also went up as a result. The previous owners got away with not having it raise their assessment and THAT is at least partially why they didn't do CO's.
As for whether or not to walk away, it really is a personal decision because you could have been searching for the perfect home for a year and this one was the only one even close to what you wanted at that price. And it depends on what it is... if it's a small deck rather than a whole extension, it may be worth taking on the extra risk and going for the house. It's easy for strangers like us to say walk away because on paper we should and we have no stake in it. That said, if it's a "take it or leave it" with no escrow money offered and a dime-a-dozen house, walk away.
Quote:
Originally Posted by Forest_Hills_Daddy
How does a buyer write the phrase in an offer letter indicating that the offer is subject to all possible required certificates (CO, CEU) being obtained and updated by the seller?
Everytime I ask a broker during a showing if all certificates are in order, they say "yes" but the posts here suggest that a lot of houses don't have all the required certificates updated.
You'd be best served if you involved both an experienced buyer's agent and RE attorney when buying here. One is "free" and the other less than $1500, but they serve their purpose.
What if I bought a worn out house with the intent to do a major remodeling? Should I be concerned with having the existing COs updated? Or would it be moot and academic if the remodeling exercise would require me or my architect to update the COs myself anyway?
Unless it is cash, if it is say an extension, it will be picked up on an appraisal and you are toast. My former neighbor purchased the "handyman special" that had been tied up in an estate for years. The roof had tarps on it because it leaked and the bank made the owners put a new roof on it, only to have the buyer knock it to the ground and rebuild. They knew it was a knock down too. The banks and lenders are tough on permits and co's because they don't want to be in the position of having to do the work in the event of a default.
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