• FreeAdvice has a new Terms of Service and Privacy Policy, effective May 25, 2018.
    By continuing to use this site, you are consenting to our Terms of Service and use of cookies.

Forced To Buy Home

Accident - Bankruptcy - Criminal Law / DUI - Business - Consumer - Employment - Family - Immigration - Real Estate - Tax - Traffic - Wills   Please click a topic or scroll down for more.

A

april59

Guest
Hi New York here. I'm in contract to purchase a two-story home in Chincoteague, VA that has a grandfathered in cesspool, but I opted not to have a survey done. There were 3 contingency clauses that gave me a right to back out of this contract. 1) Home inpsection: I paid for this and the inspector who also has an engineers background found a few things wrong but didn't think the repairs could cost more than $3,000. I haven't gotten contractor estimates on these repairs yet, but since he thought the house itself was in sound and good condition inside and out, I waived this contingency and told the buyers realtors that I'm going through with the purchase as long as the termite and cesspool inspections turned out good (these are the other two contingencies). 2) The sellers paid for the termite inspection--this inspection came out good (no active termites) I was still intending on buying this home. 3) While I was waiting for the cesspool inspection, I decided to find out how does one go about upgrading to a septic system. I called the local building codes enforcement superintendent. He asked the square footage on the house (1000 sq ft), vs the property (1300). He thought I read the numbers wrong then informed me that to have a septic system in place I'd need at least 800 square feet (1300 from 1000 leaves 300 sq. feet), and that didn't include the addition 400 sq ft for the perculator! He then gave me the name to the Environmental Superindendent. He tells me because I don't have the additional square footage for a replacement septic system, that once the cesspool fails, and it will eventually fail there are no choices. He comes in and decrees the house unlivable condemning the house! So I could lose this property if the cesspool fails. In hearing this I called the sellers realtors on June 5th and inform them that I no wanted to purchase this home due to this information. The seller isn't please with my action, and seems to be heading toward forcing me to buy the house instead of taking my good faith money and finding another buyer. My objective of this home was to use it for my week or two vacation, and set it up with a Vacation Management Rental company which the Environmental Superindentent suggested I shouldn't do--"all it would take is one wrong thing down the cesspool". My lawyer is waiting to see if the seller calms down and takes the money, or strong arms me into buying the house because I'm trying to break the contract. One step at a time he says because we really don't know how aggressive the seller will be. Anyone have any ideas, or know any loopholes to get out of this if I am going to be forced to buy this property? Thank you for your help.
 


A

april59

Guest
Guru, I Appologize For My Long Windedness

I'm in contract to purchase a home in Chincoteague, VA that has a grandfathered in cesspool. While waiting for the cesspool inspection, I decided to learn how to upgrade to a septic system.

Local building codes asked the sq. ft on the house vs the property. Property-wise, I'm short at least 800 square feet, which doesn't include additional 400 sq ft for perculator! The Environmental Superindendent informs me once the cesspool fails, and it will eventually fail, there are no choices. He decrees the house unlivable! I lose my property once the cesspool fails.

I called the realtor stating I no longer wanted to purchase this home due to the information. The seller seems to be heading towards my buying their house instead of taking my deposit. Have any ideas, know any loopholes. What are my chances of breaking the contract?
 

HomeGuru

Senior Member
You have a wimpy lawyer. Why play games and wait nicely? So you don't get the Seller upset? Heck, you should be pissed at the Seller and Realtor for trying to sell you a worthless piece of property.

If your contract was written correctly you should be able to terminate the transaction and get all of your earnest deposit money back. If your contract has a subject to financing contingency, you have another out since the lender will not loan money on this type of property. But they have to be aware of the problem.
If the cesspool fails, the lender will have no collateral of value. The mortgage would be secured to a worthless piece of real estate.
The real estate appraiser should really discount the value big time due to the cesspool situation. But they must know the true facts.

To me, the property has no value. If tomorrow the cesspool fails, the property is condemned and all you have left is a vacant lot that you can never build on.

Another point in your favor is that the Seller failed to disclose the possible condemnation due to cesspool failure fact to you.
The Realtor has also screwed up by violating several State laws with respect to licensed real estate agents and Realtor Code of Ethics with respect to disclosure, misrepresentation and standard of care issues.

The Seller and the Realtor are idiots. This is a disaster waiting to happen. A timebomb. A future 2 year litigation case where only the lawyers get rich while the parties involved get poor fighting it out in court.

You don't have to wait for the cesspool to fail before dealing with crap. You are faced with a load of crap already.

Thanks for posting a shorter post. I was not going to even respond at all due to the long-winded post. I did read your first long post to get a better understanding of the issues.

Good luck.

[Edited by HomeGuru on 06-09-2001 at 01:08 PM]
 
A

april59

Guest
Guru

Like I said sorry for the first long winded post. I made the second one shorter realizing the first one too long. I wrote third elsewhere figuring the second one was still too long, and didn't want to bother you again for an answer (you hadn't posted your response yet according to what I saw on screen).

In regards to your point that seller or realtor failed to disclose situation, how can they if either can claim they never knew?! Don't know if this is the case though.

OK, so how can mortgage company find out about this? Is it my responsibility to tell them (without committing somekind of unknown criminal act), or will they somehow find out on their own? By the way are you a lawyer, or just someone who invests in properties and knows the law very well?

I deeply appreciate your first response. Have a good day.
 

HomeGuru

Senior Member
In VA, the real estate disclosure law does not state ignorance as a defense.
Even if the Seller and their real estate agent truly did not know, they should have known. Why? Because it is their duty to find out and disclose just the same as your due diligence.

To give you a better insight on this disclosure issue, do a search on this website using search words, disclosure, home inspection, leaking roof, leaking basement, Easton v. Strassburger (this is the landmark CA case) etc.

With respect to the mortgage company, they probaly will not find out. It is your duty to inform them of the circumstances. It is not a criminal act to tell the truth and inform the lender. It will be a criminal act if you do not because the lender can claim fraud on your part.

With respect to the lawyer question, I am both an attorney and a real estate investor. My legal specialty is real estate seller disclosure and construction defect litigation.

 
A

april59

Guest
Guru

Thanks for all your legal background imput. I'll check out those words. Believe I'll have a good conversation with attorney tomorrow. Truly have a good day, good week, and good year :)
 
A

april59

Guest
A Follow-Up

VA still...

Guru, from the conversation with my lawyer, problem is realtor handed me Residential Property Disclaimer Statement, and Residential Property Disclosure Act Sectons 55-518/55-519 (sellers signiture on it but not mine). It states 1) A residential property disclaimer statement in a form provided..... owner makes no representations or warranties as to the condition.... purchaser will be receiving the real property "as is"...

This is what is giving seller upper hand with my breaking contract. What is your thought on this disclosure act?

I mentioned I should tell lender about cesspool/property problem--he said you can try that and see where they go with it". I asked if its my responsibility to, and he said yes. I thought to myself, please don't get too happy for me. I must comment for the sake of commenting--why didn't he bring this up first, adding it is my duty to tell them. I called my lender--only thing that matters to them is appraisal.

Guru, when seeking a lawyer, how does one find a good lawyer? Any particular questions to ask? I know nobody in VA who could recommend. Thanks in advance.

[Edited by april59 on 06-15-2001 at 10:53 AM]
 

HomeGuru

Senior Member
An "as-is" sale will not protect the Seller like you think it does. If the Seller knew or should have know of the problems, selling the property as-is does not relieve the responsibility and duty of the Seller to disclose material facts.
When searching for an attorney, you must find an attorney who has experience in real estate seller disclosure cases.

[Edited by HomeGuru on 06-19-2001 at 11:29 PM]
 
A

april59

Guest
Thank You Guru

Just when I thought (or my old lawyer made me think), I couldn't win without paying a hefty amount to sellers for release form, I realized I had one contact in VA (a different realtor who I intended to hook up with as my vacation property manager). Once she heard what happened (and was furious for me), she was more than willing to offer her lawyers name--apparently she's had run ins with other realtors there. This was 2 days ago. Her lawyer immedately took my call when he heard she referred me, and today the sellers are willing to give me release form for a small amount of money. But this lawyer isn't saying to accept so quickly (he's looking into the conversations I had with town superviors about cesspool first). He's very certain they'll give me my release, and my good faith deposit back as well.

Guru, thank you, thank you, thank you, for making me realize not all lawyers do their very best for clients.
 

HomeGuru

Senior Member
I am happy to hear the good news.
Just like in all professions, there are some that do not always do their job right.
 

Find the Right Lawyer for Your Legal Issue!

Fast, Free, and Confidential
data-ad-format="auto">
Top