Buyers claim seller knew of home's leaky basement

Real Estate Matters

October 26, 2008|By ILYCE GLINK | ILYCE GLINK,thinkglink.com

I sold my home in Vermont this past June (I now live in New Jersey), and since the closing, that area has received tremendous amounts of rain. As a result, the new owners have had water in the finished basement. They claim we knew about the leaking in the basement because they discovered "staining" from where it had occurred before.

We never had water in the basement in the eight years we lived there, other than condensation on the pipes, which would weep onto the floor. After wrapping the pipes in foam insulation and having air conditioning installed in the home, we never had that problem again. We did disclose this issue on the seller disclosure form. I'm concerned, however, and don't know what my next steps should be.

When it comes to proving disclosure fraud, the buyers have to prove that you knew or should have known about the problem. That's a pretty high bar for them to reach.

To get there, the buyers have to find a "smoking gun," of sorts. The evidence that you knew about the problem might include neighbors who would testify that you complained to them regularly about water in the basement. Or, the buyers might find a plumbing company that turns out to have been someone you hired in the past to correct flooding, and the company can produce invoices for services rendered.

If you never had any flooding in the eight years you were there, then you probably don't have to worry about someone finding some sort of proof that says otherwise.

If the buyers pursue this, they'll find their way to an attorney or to small claims court. Once that happens, you'll need to find an attorney who can guide your response to their legal claims.

We made an offer on a house that is about 80 years old. It was advertised as renovated, but our home inspector found two major problems.

The seller has agreed to fix one of the problems, a wiring issue, to the tune of about $3,400. The other problem involves a structural issue. When the house was renovated by the previous owners, they removed a floor furnace and did an inadequate job of shoring up the foundation.

When we first looked at the house, we expressed concern about the dip in the floor over that location. The seller's licensed contractor said it was no big deal and estimated it will cost $1,100 to fix. But the inspector says it needs to be repaired and our contractor estimated it will cost $3,700. The seller was already balking at paying for the $1,100 repair.

We do have an inspection contingency, so we could walk away from the contract. We would prefer not to do that, but we worry that if she did make the repairs that we would end up with a house that was still improperly renovated.

You're wise to have found a top-notch home inspector who called your attention to these potentially troubling and difficult problems. Given the current market conditions, you need to be focused on yourself and the condition of the house you're looking to buy.

While the sellers' circumstances might limit what they're willing to do to repair the problems with the home, you need to look at the price you're paying for the home to determine whether the seller must make the repairs when you compare the home to others in the area.

Another important issue to consider: How badly do you want the house?

If you want it only if these issues are taken care of, then you should allow the seller to do the repair, but agree to have a reinspection based on the work that has been completed.

Or, the seller can discount the house further and you can do the work yourself once you move in.

The ball is in your court. I've seen some extraordinary concessions from sellers lately because of their desperation to sell in a very slow market.

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