If your property has liens or violations against it, know that you are not alone and we can definitely help you. We have purchased many properties with open code violations, city liens, open or expired permits, illegal additions, unsafe structure violations, demolition orders, tax liens, homestead tax penalties and various other title issues that would usually intimidate inexperienced investors and regular home buyers.
What Are Code Violations?
Code violations include everything from not adhering to minimum construction standards to not fixing broken smoke alarms. While most building codes are designed to protect you, some cities aggressively flag homeowners who allow garbage to collect in their yards, don’t clean their pool or forget to mow their lawn. Often, the code violation is cleared up before the house goes on the market and the buyer is never aware of it. Other times, code violations can kill a real estate deal.
If your home does not meet a county or municipal building code, it probably has a code violation. Many homes have some sort of code violation. This is because building codes change all the time, and a house that was code-compliant when you bought it may now be behind current standards. These innocent violations are “grandfathered” in, which means they are not regarded as violations if the home was up to code when it was built. Unless there’s a safety issue, you won’t have to bring the home up to current code.
Most serious code violations happen because the homeowner adds more living space without the proper permission. Other examples include water heaters or electrical points installed without a permit, failure to use non-flame retardant roofing material and the absence of smoke detectors: the list is endless.
Once you purchase a home you inherit the violations along with it. Most buyers want you to provide them with clear and marketable title. Very few buyers will buy a property with liens, fines and open code violations against it. Selling a home with code violations can be close to impossible. Many municipalities levy huge fines and daily interest rates on the homeowners and these penalties accrue for years after the illegal work is carried out. Decades after the event, the code enforcement officer may require the current homeowner to fix the problem and bring the home up to the most current building code, often at great expense.
Can I Just Not Say Anything About The Violation?
No, you can’t. By law, sellers must make certain disclosures about the property to potential homebuyers. For example, the federal government requires sellers to notify buyers about lead paint in the property. State disclosures vary by state, but typically require the seller to disclose known structural problems, defects with the HVAC, electrical and plumbing systems and known code violations. And, if the buyer asks, you have to tell him about code violations openly and honestly, regardless of disclosure law. Closing a deal without making the necessary disclosures can bring a heap of trouble. At the very least, you’ll have to compensate the buyer for any financial loss.
In any event, the code violation usually pops up during the buyer’s due diligence period. If the buyer doesn’t find it, the title company probably will when it checks the county records.
Fixing Code Violations
If your property has open code violations and fines that are accruing on a daily basis, contact the city immediately. Many times, the city is willing to work with homeowners to fix the problem. You may even be able to negotiate the sanction down to a reasonable amount. What happens next depends on the specific violation. Often, homeowners can hire a contractor to close an open violation. You’ll have to pay for the corrective work and pay off any fines, but once the work is done you can list your home for sale. If the work is beyond your budget but you need to sell, a few real estate investment companies may buy your house for cash and deal with the violations themselves.