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We are buying a house that has a finished basement and quite a few additions. Before making the offer I shared my concerns with my agent about making sure that its all approved and they have permits, and she said not to worry about it because the attorney will take care of that...
The contract I just got from the attorney states, among other things, that he will not determine if improvements to the home were done with proper permits and approvals, and that is something that I need to do on my own. Does that make sense? I have no reason to believe that the sellers don't have permits, as he is a contractor, however, I need to have this covered. The seller did specifically mention that he made additions to the house, and since I don't know what the house looked like before, it would be hard for me to do this on my own, as the attorney's contract suggests. What do you suggest we do?
First thing is call the township and ask for all permits for that address. They should let you know what permits were approved. I just did this for a house I am buying in NJ. I would have done this even no matter what the seller had provided to me anyway.
And if you are not happy with what they said you can always not agree to it and walk away.
Your agent said "not to worry about it". I love it. This is terrible advice. You should worry about it. The fact that the seller is a contractor makes it all the more likely that permits were not obtained for all the improvements/additions. And in some cases the town may require removal of an improvement that violates zoning laws.
Go back to the house and make a list of all the additions and improvements in question. Then have your attorney request closed permits for all the questionable items.
If they are not made available to you, you have a problem, and a decision. You could either back out of the deal and find another home. Or you could go to the town and find out what will be required to legalize the situation and ask the seller for a financial credit to cover the cost. Or you could just buy the house and absorb the costs yourself. That decision is up to you.
However you should clear this up now. If you are a new buyer and approach the town with the honest intent to make things legal, they will probably go easy on you. If you wait until you become a seller, then you become the guilty party and they will be more difficult and more expensive to deal with.
There is also a property tax implication. If there are a lot of unpermitted improvements that now have to be legalized, your property taxes will probably go up.
Good luck and protect yourself, you apparently have an attorney and an agent who are not interested in doing any serious work to protect your interests.
Your agent said "not to worry about it". I love it. This is terrible advice. You should worry about it. The fact that the seller is a contractor makes it all the more likely that permits were not obtained for all the improvements/additions. And in some cases the town may require removal of an improvement that violates zoning laws.
Go back to the house and make a list of all the additions and improvements in question. Then have your attorney request closed permits for all the questionable items.
If they are not made available to you, you have a problem, and a decision. You could either back out of the deal and find another home. Or you could go to the town and find out what will be required to legalize the situation and ask the seller for a financial credit to cover the cost. Or you could just buy the house and absorb the costs yourself. That decision is up to you.
However you should clear this up now. If you are a new buyer and approach the town with the honest intent to make things legal, they will probably go easy on you. If you wait until you become a seller, then you become the guilty party and they will be more difficult and more expensive to deal with.
There is also a property tax implication. If there are a lot of unpermitted improvements that now have to be legalized, your property taxes will probably go up.
Good luck and protect yourself, you apparently have an attorney and an agent who are not interested in doing any serious work to protect your interests.
Hi,
Are you saying that an attorney should look into the permits for me? Is this common practice for the attorney to look into this? If so, if you can recommend a good attorney that can do this for me I would really appreciate it. Problem is, we are going away for a week this coming Saturday, had this planned for a long time and can't change it. The clock is ticking and I need to make sure that we are covered. The agent told me that the attorney will look into it, and now this is a big surprise for us! Why would he not do it (unless they don't typically do these things)...
Go back to the house and make a list of all the additions and improvements in question. Then have your attorney request closed permits for all the questionable items.
That's a problem... How do I know what was there to begin with, and what was added? I know they extended the kitchen, but not sure about the rest...
That's a problem... How do I know what was there to begin with, and what was added? I know they extended the kitchen, but not sure about the rest...
If you get out of attorney review (and I wouldn't without getting that particular clause struck), you can have your home inspector give you a pretty good estimate of when the changes were done. You can then ask your attorney to either request that the seller furnish evidence of closed permits, or ask the town for them.
The contract I just got from the attorney states, among other things, that he will not determine if improvements to the home were done with proper permits and approvals, and that is something that I need to do on my own. Does that make sense? I have no reason to believe that the sellers don't have permits, as he is a contractor, however, I need to have this covered. The seller did specifically mention that he made additions to the house, and since I don't know what the house looked like before, it would be hard for me to do this on my own, as the attorney's contract suggests. What do you suggest we do?
The seller might want that in the contract, but you don't have to agree to it. Negotiating terms and conditions is what attorney review is for.
If it were me, I'd talk to my attorney about sending back the same contract to the seller with that clause struck out.
It's not clear to me whether you're in or out of attorney review. If you're still in attorney review, you should deal with this now.
I don't understand why "the clock is ticking". Your attorney can void the contract at any time, for any reason (or for no reason), until you're out of attorney review. Everything is negotiable (including time to respond).
The seller might want that in the contract, but you don't have to agree to it. Negotiating terms and conditions is what attorney review is for.
If it were me, I'd talk to my attorney about sending back the same contract to the seller with that clause struck out.
It's not clear to me whether you're in or out of attorney review. If you're still in attorney review, you should deal with this now.
I don't understand why "the clock is ticking". Your attorney can void the contract at any time, for any reason (or for no reason), until you're out of attorney review. Everything is negotiable (including time to respond).
I have not started the attorney review yet... The attorney mailed me his contract (with the statement that it is my responsibility to check for permits), and the next step is for us to sign the contract so we can initiate teh attorney review. If my understanding is correct, at this point I should ask the attorney to remove that statement from the contract with him, and ask him to look into permits? If he doesn't wnat to do it I should try to find someone else, right? I am not sure why he put that statement in his contract - is it that he doen't want to be bothered with these things, and he is pushing it down to me to deal with (but then why am I getting an attorney?), or the statement is there at the request of the sellers... Either way, this is something that an attorney should be able to do for me, right?
I have not started the attorney review yet... The attorney mailed me his contract (with the statement that it is my responsibility to check for permits), and the next step is for us to sign the contract so we can initiate teh attorney review. If my understanding is correct, at this point I should ask the attorney to remove that statement from the contract with him, and ask him to look into permits? If he doesn't wnat to do it I should try to find someone else, right? I am not sure why he put that statement in his contract - is it that he doen't want to be bothered with these things, and he is pushing it down to me to deal with (but then why am I getting an attorney?), or the statement is there at the request of the sellers... Either way, this is something that an attorney should be able to do for me, right?
This is getting more confusing ...
When you initially make the offer, you sign a standard contract. The contract is between you and the seller.
The process as I understand it, is that the attorneys then exchange proposed amendments to the initial (standard, NAR) contract. They don't rewrite the contract from scratch.
Is the contract that your attorney sent you a contract between you and your attorney, or between you and the seller ?
If your attorney is telling you they won't help with this, maybe shop (very quickly!) for another attorney ?
Permits (or the lack thereof) has come up several times during my transactions and every time it was the seller's responsibility to provide the permits. If permits weren't obtained during the construction, it was STILL THEIR RESPONSIBILITY to have the town building inspector come in and inspect the work after the fact (be that months or years after the work was done) and approve it, or not. You shouldn't have to go to the town to do this research. Although your attorney (or probably any attorney) won't do the legwork, they do typically demand that the seller produce permits.
Who knows what corners may have been cut during the "improvements." And once the deal closes, the problem is yours. And, once you try to sell the home, your buyer may want to see those same blasted permits and if you can't produce them, again, the problem is yours.
Oh, and dump that agent, asap.
Good luck!
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