Foreclosure in 33015>Question Details

William Dova…, Home Buyer in 33018

Foreclosed home purchase with previous leak not disclosed to new buyers.

Asked by William Dovale, 33018 Wed Feb 10, 2010

I just purchase a foreclosed home in miami, fl about 3 months ago. We just received the water bill and its 2000 dollars, although we have only been in the house for a month (me, my wife, and two children). I called the water company and they told me that they did an investigation on the house in october (before I bought the house) and told the sellers that there was a leak that needed repair. No of this was disclosed to me before I purchased the house. What can I do? I have done my research and think we have legal grounds for going after the seller. Since they didn't disclose the information provided by the water company they misrepresented the house and defrauded us. Can anyone provide any insights?

Help the community by answering this question:


Randy Rehler’s answer
Perhaps you should consider the expense to hire an attorney to initiate a legal action against the seller. It will exceed the $2,000 you are out of pocket in very short order. Probably not worth the expense.

Also, contact the water company and ask for a credit for the portion of the bill that is for sewage use. Since they know about the leak, they should be willing to credit you back at least some of that portion of the total bill.
0 votes Thank Flag Link Tue Feb 16, 2010
I'm sorry, but I am confused to everyone's answer. In the State of Florida I was under the assumption that a house can be "as is" but defects still must be disclosed. On the Miami Dade County's website there was a new law passed to protect individuals buying foreclosures from such problems. Or are we exempt from the rest of the state's rules & regulations?
0 votes Thank Flag Link Tue Feb 16, 2010
Mr. Dovale you did not disclose if you were represented by a Realtor, if a home inspection conducted by a qualified and knowledgable Home Inspector was performed, or whom the seller was and if they were represented by a real estate professional. If you were granted access to the property for inspection, there would have been no guarantees that the inspector would have been able to determine if there was a leak or not. In my experience, sales of vacant foreclosed homes are typically sold in "AS IS" condition . Most of the time the utilities are turned off. The utilities are generally turned back on for licensed FHA Appraisers which is a requirement by HUD. If you feel like you have been misrepresented and defrauded by either parties then you should seek legal advice. Good Luck!
Two words come to mind when buying a foreclosure, "Caveat Emptor".
0 votes Thank Flag Link Thu Feb 11, 2010
You've gotten a lot of answers that basically come down determining exactly who you purchased the home from and if it was in fact a foreclosed home. Do you know who the seller was that was signing docs in this transaction and the second big piece of information is who the water company actually notified.
Also, are you sure the water bill was from a leak? Delinquent water bills will "follow the property" if not paid at closing.
If you can document that the seller had prior knowledge it would be worth at least a consultation with an attorney to see if you have a case and what the cost would be to pursue it and what you could recover (your costs and the repair & billing?) and determine if it is worth the time and risk for cost involved or whether to chalk it up to lesson learned.
I also counsel buyers I'm working with that when you choose to purchase a foreclosure or short sale property there are always going to be issues that will arise no matter how carefully you inspect and try to cover all unforseen issues....but you are typically getting a property at an excellent price for the market.
good luck!
0 votes Thank Flag Link Thu Feb 11, 2010
William, did you buy this 1) in a "short sale" from a seller whose lender approved the loan OR 2) direct from the lender after they had foreclosed and taken possession. If 1) , then get a lawyer and go after the seller big time, they may be broke now but it's still no excuse for fraud. If 2), then you better be able to prove in writing that the water company notified the lender in writing about the leak. If you can see a lwayer. If not, it's your money do what you want.
0 votes Thank Flag Link Wed Feb 10, 2010
Best confer with an attorney HOWEVER if home is a foreclosures, banks cover their tails off these issues you most likely have signed your life away you can't sue.

If it took place after bank took possession not much you can do bank would have no knowledge of this.

Web Reference:
0 votes Thank Flag Link Wed Feb 10, 2010
The home inspection was done and did not uncover anything. I have research legal cases that no matter if the house is sold "as-is" the selling party is responsible because they were notified. If they were notified and did not share this information then they misrepresented the house. If they didn't know, it would be another matter. The water company did an investigation and provided the information to the selling party. I have already fixed the leak, therefore its not a matter of getting them to fix it. Its a matter of them misrepresenting the house and not providing the information that they had available. They intentionally hid the information. Of course the water company has written documentation that they provided the information that the bill was extremely high and there was a leak.
0 votes Thank Flag Link Wed Feb 10, 2010

The property was bought from a bank as a foreclosed property. Usually the lender makes no warranty or guarantee- the lender has no idea of the condition of the properrty- first hand.

Your contract would address the issue of condition and inspection. It would be best to talk to an attorney- who woulf read your contract and tell you what remedies, if any are available. When buying a foreclosed propertyit is crucial to have a thoroigh inspection- wnen people are in foreclosure- they usually do not maintain the property the way they should.

Mott Kornicki
0 votes Thank Flag Link Wed Feb 10, 2010
If you purchased a REO, I am sure you signed an as is addemdum. Hopefully you had a inspection indiating all the issues with the house so you had a chance to address when you made your offer. If you signed an as is addendum, your chances of winning a lawsuit are small in my opinion. But check with an attorney in your local market. Get him to give you a risk/reward anylsis in your case.

If did not sign an as is addendum , then get your documentation together, and proof that the water company communicated that information to the right party. Wish you the best of luck.

Keith Manson
First Weber Group
Certified Distressed Property Expert
Metro Milwaukee
First Weber Group
0 votes Thank Flag Link Wed Feb 10, 2010
I'm in total agreement with James on this one. All foreclosures are sold 'as is' because the bank has never lived in the house and has no knowledge of any issues. You would have to have signed paperwork that alerts you to this fact as well as highly recommending getting a home inspection, which would have uncovered the problem and given you the chance to back out or renegotiate. I wouldn't bother with the attorney because you will lose that war, save the money. If you dont remember signing forms saying it was 'as is' and you should get a home inspection, then I would consult the agent who represented you.
0 votes Thank Flag Link Wed Feb 10, 2010
This question would probably be best directed to a real estate attorney. By the seller, you mean the bank in this situation since it was a foreclosure. Foreclosures will be sold generally "As-Is" and with no disclosures. An attorney would be able to tell you what they are and are not responsible for.However, my question is did you have an inspector take a look at the property before you purchased?
0 votes Thank Flag Link Wed Feb 10, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer