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The town will be able to collect their fees for the permits along with re-assessing the property for increase tax dollars. Unpermitted work is a blanket term that applies to any modifications made to the home that should have been permitted but were not. The work can include most components of the home—electrical, plumbing, structural, etc.
Your lender might agree to grant you a mortgage even after discovering unpermitted work. However, they might not let you borrow enough to cover the purchase price. In some cases, your appraiser might not value the house at what you need to borrow in order to match the list price.
#7 Should I Still Buy the House if I Know Work Was Done Without Proper Permits?
The listing agent is also required by law to include unpermitted additions as part of the property’s description on the MLS . Lena Katz outlines which improvements sellers must disclose in her article “What Is a Real Estate Disclosure Statement? Still, sellers and real estate agents are required by law in most states to disclose this information. Are you confused about building permits when buying or selling real estate? When you're a first-time buyer, you may wonder why so many homeowners try to sell a property without all of the necessary building permits. There are many reasons why a homeowner may pass on selling a home without the necessary paperwork required by state or town planning laws.
Working as a real estate agent for the past thirty plus years, I can’t tell you the number of times someone has asked me if they should pull a permit. As such, the buyer’s agent might already know about unpermitted work before receiving a disclosure statement. If the seller or the seller’s agent knowingly withheld information about unpermitted work, they might be legally obligated to fix the issue. We explain the home buyer’s legal course in greater detail below. Third, the homeowner might think restrictions and requirements set by the city are impossible to meet.
Building Without a Permit
Maximum Real Estate exposure is a marketing site designed to give Massachusetts home seller’s a dominant online presence. If you do have unpermitted work, decide if you will sell as-is or get a permit. Sellers that know their home has unpermitted work are usually aware of the fact that they might need to offer a discount to sell as-is.
Major improvements might also pop up during the title search, which most mortgage lenders require before financing a home purchase. As an extra precaution, you can also cross-check with your local building department to see if the owners pulled permits. Many municipalities, such as New York City, have the status of permits online. Otherwise, you can call or visit the local buildings department for information.
Option 2: Sell Your House As-Is
Second, the homeowner might have decided the permitting process was too expensive, time-consuming or complicated. Simply put, unpermitted work is anything you do to your house that would normally require a permit from your local city building department and where a permit was not obtained. Requirements vary by county and state, but can include improvements like adding a room, replacing windows, or building a garage. Making improvements to your home can be a great way to add value and attract buyers when it’s time to sell. While you might think a renovation is as simple as doing the needed work, some projects require a permit before they can happen.
Though rare, your mortgage could fall through if permit records show your dream home is not up to the current building code. As a result, the new owner of a home with unpermitted work could lose their financing or insurance coverage. They might also end up paying massive fines to the city and/or bring the unpermitted additions up to code at their own expense. In some cases, they might even be forced to demolish an addition due to code violations that cannot be resolved. Her reaction, right there, is without a doubt the biggest consequence for not pulling permits.
Finding out that an addition was built without a permit or electrical work was done illegally can be a shock and a huge headache. It is each homeowner’s responsibility to keep records of maintenance, repairs and other changes made to their property. Imagine if a record of all the work done to your home was easily accessible and verifiable – from breaking ground twenty years ago to routine maintenance last month.
Take a look around any room full of home inspectors, and you'll notice we look a lot alike. It's as if there's an unwritten rule that you have to be an old white guy to be a home inspector. I recently had an informative email exchange with a past client that highlighted the discovery of some especially nasty water damage behind the stone siding at her townhome. I was curious about the events that led up to the discovery, and it all came down to one person being very curious and very persistent. I thought she had such a great story to share that I invited her onto our podcast, which you can listen to below. FLIR has a relatively new pocket-sized infrared camera with all of the bells and whistles of the much larger and expensive E6.
I would take a little more time to look into the specifics for sure. Not just what work was done unpermitted, but how the local laws will address it. A lot of things get grandfathered in, and it varies by town, but there are absolutely towns that will make you take that porch down. Get more info from the insurance about what they found and where, find out what you can from the town, and look into the building codes and enforcement to see what might be a problem later. We’ll start by laying out some of the reasons the owner may have opted not to pull a permit, some implications from it, and what to do next if you still want to purchase the home.
From the legal point of view, houseboats do not count as building made for long-term living, but it is understood as a means of transport. Pre-fabricated houses, mobile homes, and even caravans do not fall under the category of ‘buildings for living’ as long as they are not fixed to the ground. These designs are mostly wooden houses, but there are also designs based on typical steel-box containers. In this way, it counts as a movable object and not as a building. Mortgage companies can require an immediate loan repayment due to unpermitted additions. If the potential buyer chooses to continue the sale after disclosing all unpermitted has, they will be assuming responsibility moving forward.
Should you discover unpermitted work after closing, you must get in touch with your local building department and a city inspector. If a permit was required and the previous owner applied for that permit, your city building department should have all documentation on file. If they did require a permit, but none was filed, the building department should be able to advise you on what to do next. If you find out that a seller didn’t pull all of the required permits, you’ll have to evaluate whether that means some were pulled – or none. In many parts of the country, you can look on the website for the local municipal office that handles permitting in your town or city and find out if any permits were pulled for a specific property. If it isn’t online, you can frequently get it by going to the municipality’s building department and requesting the information.
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