Home Buying in 90603>Question Details

Hyn, Home Buyer in 90603

If I purchase a house that was extended without a permit, what happens?

Asked by Hyn, 90603 Mon Nov 28, 2011

I'm looking at a house. But the previous owner extended a room and a living room without the permission of the city. If I purchase this house, and the city finds out that the extended parts have to permits, what happens?

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Answers

15
Hyn:

There is a lot more to this than the City finding out that you have unpermitted additions.

Here's some food for thought on unpermitted additions/construction.

Additions that have not been properly permitted have also, most likely, not been properly inspected to ensure the addition was built to local codes and requirements. Additionally the homes size (square footage) has been changed and not properly reported to local property tax authorities. If the mortgage company does not discover this through the appraisal process then the insurance company might. If neither catches the "illegal additions" and the mortgage does complete these are the possibilities at a later date:

1. If you ever experience a claim on the home with your insurance carrier, especially if it deals with the illegal addition, then your insurance carrier may refuse to cover the claim as the home has had improperly permitted additions, changes, modifications to it.

2. If the local taxing authority discovers the changes and determines when they were made they might assess you retroactively for the amount of taxes, penalties and interest they could have collected.

3. If the local building department discovers the illegal additions (the taxing authority will advise them if they find it) then you may be subject to penalties, potentially have to remove it or at least parts of it for inspections, etc., etc.

4. If in the future your mortgage company discovers that you have illegal additions, and that you were aware of them, they might also have methods of redress to prevent any issues with the loan such as prematurely calling in your loan with an immediate payoff demand. The mortgage company is not going to want to expose themselves to potential future liabilities and have many avenues of redress to prevent them of which this is one.

5. If the illegal additions violate local zoning ordinances, setback requirements and/or extends onto your neighbor’s property then your title insurance company is most likely not going to cover this situation either. It can result in you bearing the full cost of rectifying the problem.

6. If your illegal addition causes your neighbors any problems, or your relationships with your neighbors sour, then they can "drop a dime" on you to the local building department and get the ball rolling for any/all of the above to occur.

7. If you are lucky to not experience any of the above and try to sell the home later it may then be discovered and cause you significant grief in the sales process. First off you know it is an illegal addition and will have to disclose that. Even if you don't and the new buyer discovers it prior to closing and backs out you now cannot avoid disclosure. Also when it is discovered any of the above actions can again be started.

If you know or suspect a home has illegal additions to it then you should perform additional due diligence before your option period expires. It is a simple thing to visit the local building department and check the history of the home for its original build size and ANY permits that may have been requested for additions, major upgrades, modifications, etc.

Sellers are required to disclose these things but Seller Agents are not required to research a home to make sure the seller tells them the truth.

The onus of performing due diligence and its consequences is solely on the buyer. Your agent will assist you where he/she legally can but ultimately it will be your call.

Bob Khalsa
Broker
2 votes Thank Flag Link Mon Nov 28, 2011
Worst case, the city can require all the non-permitted changes to be undone at your expense if you purchase the house. This could include knocking down the additions and making retrofits to the existing structure. Otherwise, if it's up to code, you could get a pass from the city, but I wouldn't bet on it.

Then again, like Ron pointed out, who's going to tell the city? The most likely time anybody would do that is right now, when the house is on the market and others, like you, know about the non-permitted changes. If there's any lingering concern, have your Realtor pull up some comps of homes without the non-permitted additions and adjust your offer accordingly.
Web Reference: http://www.archershomes.com
2 votes Thank Flag Link Mon Nov 28, 2011
Hyn, you and the house get sucked into a vortex never to be seen again!

Just kidding. We live and work in Whittier. It's an old town and many of the properties have extra, un-permitted rooms. If the addition was done in a workman-like manner, and it is not a danger to yourself or your neighbors you should be fine. However, if a neighbor complains and a city inspector comes out you may have to tear it down or bring it up to current building codes.

In any case, remember that a bank will not loan on the un-permitted square footage of the house. If the addition was done well and is livable, you're basically getting more living space for a lot less.
1 vote Thank Flag Link Tue Nov 29, 2011
Hyn,
You will be required to disclose anything you know about the home when you decide to sell. If you are comfortable with the quality of the work, your perspective buyers may not be. I've heard of cities finding out about situations like this and requiring the current owner to pay for permits and bringing the work up to current standards.
1 vote Thank Flag Link Mon Nov 28, 2011
From a lenders perspective: the appraiser will not be able to give value to the extended square footage amount.
0 votes Thank Flag Link Tue Jan 12, 2016
Hi,

if the city finds out you may have to get it inspected and will have to make sure it passes code,
if not worst case they can make you tear it down,
so factor that in when making an offer,

I would be happy to work you. Please feel free to contact me anytime
if you have questions.
0 votes Thank Flag Link Tue Jan 12, 2016
Hi,

Are the extensions even safe? Was it done properly and by a licensed contractor?

Kind regards,

Arpad
0 votes Thank Flag Link Sat Jan 9, 2016
Are there laws in California about renting a home to someone with an addition that's not been permitted
0 votes Thank Flag Link Sat Jan 9, 2016
Hyn, I am an experienced Realtor and investor and I have purchased many properties that had non-permitted additions. Most Cities will not contact you to change or fix this addition unless they already this unpermitted living room addition in their records. I would go to the City or County and ask question like "Can you tell me what inforation, permits, open records about 123 Elm Street." That agency will tell you what they know of the property. The chances of them contacting you is very, very slim. If you are getting a great buy or really want this property, dont worry mush about the unpermitted addition. Make sure the price you are paying reflect the actual square footage that the TAX ASSESSOR reflects, there will be a discrepancy between the City and the County. I wouldnt worry mcuh about this, but you need to become comfortable with your purchase and you are assuming this issue. Good luck ! Jay Green
0 votes Thank Flag Link Sun Mar 15, 2015
Hi, you will then have to get a permit. The most important thing is the building inspector will have to make sure everything was done to code and the fire inspector will have to check electrical. Unfortunately this stuff happens alot and one of the main reasons the town wants to inspect is to make sure the structural integrity hasen't been compromised with the additions/renovations. Stuff like this brings the whole purchasing/selling process to a halt because no bank will fund a loan without the permits and approval. In essence the home is being used as collateral to pay back the loan, that is what a mortgage is.

Christopher Pagli
Licensed Associate Broker
Accredited Buyer Representative
GREEN Designated Agent
William Raveis Legends Realty Group
914.406.9023
0 votes Thank Flag Link Tue Dec 6, 2011
These are great answers. What the previous owner did was illegal whether they knew what they were doing or not. The minute they modified the structure without acquiring permission and permits from the City to make modifications they broke the law. The City of Whittier can require you to become Code Compliant or Tear it Down. All at your expense if you purchase. It is a roll of the dice!

Good Luck!

Ed Torrez
The Investor's Broker
(562) 577-0496
Web Reference: http://www.edtorrez.com
0 votes Thank Flag Link Tue Dec 6, 2011
Lot's of pretty good answers. But, if you really want the home just go to the building department who has jurisdiction and ask them what their policies are on an "As Built" permit.
0 votes Thank Flag Link Tue Nov 29, 2011
I recommend making a trip donw to the City of Whittier and speaking with the building department or if this home is located within the County of LA, then go to the satelite office located on Telegragh. Ask to see any and all permtis ot record for the property. The square footage and the bedroom and bathroom counts are shown in the Tax Assessors office and I recommend calling the LA Tax Assessor to see what they have on record. This will be the prevailing information that appraisers and most everyone will refer to. Do not rely on a Realtor or anyone else for this info. This is a simple process.

It may or may not be a problem pruchasing a home with an unpermitted addition. You just need to understand what that might mean to you in the future, when you go to sell the home or possibly refiance it.

Again, the Tax Assessot infor will be the most accurate. Go do your investigations and descover what is on record and what you are getting yourself into.

Fell free to shoot me an email or call me at 714-747-1912 and I can explain in detial. I am an experienced investor and Realtor.

Good luck!

Jay
0 votes Thank Flag Link Tue Nov 29, 2011
You better walk away....Does your city or village require to have a pre-purchase inspection..if yes..you will be unable to finalize the transaction( plat of survey).if no....don't risk your money anyway...Worst to come....you will have to undo what was done without the permit ( possibly a room extensions demolition ) Do you know if the city issued a stop work order ?
0 votes Thank Flag Link Mon Nov 28, 2011
First Q: How long ago was the work done?
Second Q: How's the quality of work?
Third Q: Do you think was done up to Code?

Assuming that you answered: "Long Time", "Good", and "Probably", then I would ask:
Fourth Q: Who's going to tell the County?

Assuming that 1 thru 3 were negative: I wouldn't purchase the house; it could be a Pandora's Box.

Good luck and may God bless
0 votes Thank Flag Link Mon Nov 28, 2011
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