If buyer uses certain banks for the mortgage, they may get away without the C of O, but when buyer goes to sell the property, buyer will run into the same issues.
There are several different schools of thought on this. It also becomes a question of whether or not the alteration comes up as a violation on public records. If there is a reported violation, the problem is brought to the surface and will have to be addressed in one way or another because most banks will not give a mortgage on a property with an outstanding violation. If there is no violation, you may want to take a wait and see approach because there is a chance that it may not become an issue.
So with that, here are some options:
1) Do nothing and wait and see if it becomes an issue.
2) Rectify the problem before you sell. This will entail money and effort and you want to make sure you do it in a legal fashion.
3) Offer to rectify the problem after you go into contract with a buyer if it should become a problem.
4) Inform the buyer that it will be their responsibility to rectify the problem if it becomes an issue during the process. If you choose this option, be prepared to accept a lower sales price.
I will also suggest that you speak to a good real estate attorney and/or architect about this. If you want you can also call me and I can get my attorney and/or architect on the phone to try and assist. Either way, good luck!
Mitchell S. Feldman
Associate Broker/ Director of Sales/ e-Pro Realtor
Fillmore Real Estate
Office: (718) 252-2000/ Cell: (917) 805-0783
If there is no violation it would be prudent for the current owner to restore it to the pre-existing condition, before putting the property on the market..
If there is a violation of record, then yes the work will need to be filed to correct the violation/condition, and again should probably be done before putting the property on the market.
Depending on the condition of the rest of the property and so long as this extra "room" is not actually an extra apartment and it will be delivered vacant at closing, many banks will hold an escrow to ensure that the condition gets corrected in short order, especially if the garage conversion is really just a workshop/hobby room conversion.
Kathryn Lilly, Broker
Realty on the Greene, LLC
When something illegal is done to a home W/O permits and the seller is looking to sell there options regarding this work is to either replace the home to its state prior to the work or attempt to legalize the work prior to selling the house this might take the hiring of an architect to file plans and permits depending on what kind of work was done in your case converting a garage to a bedroom would probably need an architect to file plans.
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Senior Loan Officer
STERLING NATIONAL BANK
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