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Bill, Home Buyer in Encinitas, CA

Just did a home inspection on a condo I am buying and there is no heater in the unit. Does seller have to fix this by law? Health and safety issue?

Asked by Bill, Encinitas, CA Sun Jul 17, 2011

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You asked:
"Just did a home inspection on a condo I am buying and there is no heater in the unit. Does seller have to fix this by law? Health and safety issue?"

Your question shows the importance of a home inspection.

You have 3 issues in your question.

1 - Is it the law? The answer is no. There are only 3 things a seller is required to do statewide to sell a home in CA. Smoke detectors where required, waterheater must be earthquake strapped & braced, and as of July 1st, must have a CO Detector installed. Some jurisdictions like San Diego city may have other regulations like water conservation or cities where it freezes or has high heat may require cooling or heating. (Note, I am not an attorney so this is my opinion, not legal advice).

2 - Will your lender approve the condition of the home? Here is where "health & safety" come in to play. Realistically speaking, a space heater is all many people use, even if they have central heat. You will not freeze to death in Encinitas without a heater but most non-conventional lenders like VA & FHA will require a heater. Now it becomes a negotiation between you and the seller. Even if your lender requires it, the seller is not obligated to install a heater however, you many not be able to buy the property.

3 - Disclosure. If it is a bank owned property, they have very limited disclosure requirements. A regular seller should have known and disclosed it but in either case, they are not required to install a heater to sell the home. Hopefully, you have not removed your contingencies yet.

I am curious though, I have been a Realtor who has worked and lived in Encinitas for 17 years but I know of no condos that were built without a heater. Some have ceiling heat which is difficult to see. Did your inspector say it was never installed or was it removed?

Dennis Smith, ABR, SRES, e-PRO, CDPE Realtor® CA DRE#00476662
RE/MAX By-The-Sea
4 votes Thank Flag Link Sun Jul 17, 2011
Hi Bill,
Just an update, if there was an existing heater that was in the condo, chances are the duct work is still in place. Make sure to get multiple estimates, check the contractors license number at http://www.cslb.ca.gov/ also, make sure they have current general liability insurance. Hope this helps.
1 vote Thank Flag Link Sun Jul 17, 2011
No they do not have to fix it by law. But if you are getting an FHA or VA loan on the property it will need to be fixed and working before the lender funds the loan.
1 vote Thank Flag Link Sun Jul 17, 2011

Is this a bank owned distressed sale(foreclosure) and being sold "AS IS?" If so, the seller may have taken tis into consideration when determining the list price and are not concerned about lender approval because they are seeking cash buyers.

There seems to be vital information missing that could be helpful to providing accurate feedback.....

Good luck,

1 vote Thank Flag Link Sun Jul 17, 2011
Bill, Has the appraisal been done? Is there a "community" heater? I would think you are going to run into issues with financing unless there is some sort of heating mechanism providing service to the unit. Could be considered a health and safety issue, or the lender could just deny financing. Certainly a negotiable item...curious that it was not disclosed in the listing or the sellers disclosures. It seems pretty incongruous that seller or LA did not know there is no heater in the unit.

Best of luck!
1 vote Thank Flag Link Sun Jul 17, 2011
I've seen homes sell without a heater. The ultimate decision about whether it will fly are the requirements of your lender.

If you are going with a VA or FHA loan - it will need to be fixed.

If the home is sold as is - or your lender does not require a repair, it may legally be sold.

The bigger question is 'Do you WANT to Buy a Home Without a Heater?'
0 votes Thank Flag Link Thu Jul 19, 2012
The FNMA HomePath Renovation loan may be able to provide funds to install the heater. Check with your lender about that. The Home Path program is one of the few that do not require an appraisal and also may lend you funds to do improvements to the home.
Good luck. Encinitas is a nice community.

I am never too busy for your referrals

Jerry Heard
Your Broker
The San Diego Property Shop
Direct 619-920-9796
Office 619-269-5545
Fax 619-269-9168
CA DRE # 00648687
0 votes Thank Flag Link Thu Jul 19, 2012
Not by law by the lender might have criteria regarding this. What type of heat did it originally have? Sometimes it's fairly simple to fix this to satisfy the lender criteria.
0 votes Thank Flag Link Thu Jun 7, 2012
If you are going to get an FHA loan, Yes.
0 votes Thank Flag Link Thu Apr 26, 2012
I couldn't have said it better than Dennis or James.
I do have a question though: did the listing say that there was heat?
0 votes Thank Flag Link Tue Oct 4, 2011
I think Dennis had the over all best answer for you... Fannie Mae REO does have a stream lined loan that does not have an appraisal (http://www.homepath.com/financing/index.html). My understanding is that you have to be obtaining a Fannie Mae loan on a Fannie Mae property (I kinda wonder if they will get in trouble with this down the road, but that is another story) You and/or your agent should contact some HVAC guys and get some bids on getting it replaced. Then give the bids to the listing agent to submit to the bank to have a price reduction or credit to you made. If the bank says no, figure what the place is worth to you and either cancel the transaction (granted you have not removed your contingencies, talk to your agent first) or move forward with the sale.
If all the duct work is there, depending on the size of the home (and speaking from past experience) you should be able to have a new heater installed for around $1,000 bucks +/-.
Web Reference: http://jamesbaxterhomes.com
0 votes Thank Flag Link Fri Sep 30, 2011
Was the heater there when you first viewed the property? Does your contract state the sale is
0 votes Thank Flag Link Mon Jul 18, 2011
Fannie Mae & Freddie Mac loans require an appraisal from my past experience. I'm fairly certain that the guidelines will require the condo to have a working heating system. It's unlikely that the appraiser will overlook the absence of the heater. Even with "As Is" properties I've asked the lender to rectify a serious problem and they have agreed. I would ask the lender to install a heating system on the "Request for Repairs" form and mention that the unit is not in compliance with HUD guidelines.
0 votes Thank Flag Link Sun Jul 17, 2011
something is not adding up here bill, i have not seen a loan program that does not require an appraisal.

since you are dealing with a REO it may well be that the seller did not know that the heater had been stripped out. and the agents here will agree that most REO agents are not known for their disclosure compliance, so they may not have known either...although they are required to do what we call a "diligent visual inspection", many are very bare-bones about their inspection memos.

with this new advice i suggest that the seller be put on notice that the home is not habitable and that a heater needs to be installed or the price of the home be amended to reflect the newly discovered defect.

if you do need to get a new heater the code has added additional energy efficiency burdens to the ductwork that makes the job more that just reinstalling a heater plant...you may have a problem finding an HVAC contractor who will do just the fixture.

it is entirely up to the seller whether they will accommodate the lack of a heater. dennis smith below mentions removing contingencies...his remark is very important...with the hesitance of lenders to loan these days i would be VERY careful removing contingencies here.
0 votes Thank Flag Link Sun Jul 17, 2011
Thank you everyone for your responses.........apparently the last owner took out the heating unit completely. I have not received the disclosures yet from the seller. My loan is Fannie Mae so no appraisal is required, therefore the lender doesn't require it to lend. It is an REO "as is" property so I guess it's entirely up to the seller right?
0 votes Thank Flag Link Sun Jul 17, 2011
Did you see a Forced Air Heating Furnace? If so, it may be just a minor repair. If you saw that it was removed, if this is a "As Is" REO purchase, this won't be cheap to replace.

If neither of the above, I would agree with Mike ford that the unit has radiant heat. Radiant heat is not very desirable, but not uncommon in condominiums. Especially ones that were built around the 1980s.

Best wishes, Rudi
Web Reference: http://www.umboc.com
0 votes Thank Flag Link Sun Jul 17, 2011
the answer is pretty simple...if you are financing with an fha or va loan,it is required that the unit have a heat source(health and safety issue)...when the appraiser comes in,he will most probably test the unit if it is there to make sure it is in working condition....he if sees no heating source,he will most probably call that out as something that must be installed prior to close...if you are using conventional financing,the appraiser may or may not call it out...of course,if you are paying cash,there is no appraisal unless you order one yourself...

as an exclusive buyers agent,I would advise you to ask the seller to install an electric wall heater prior to close...even if it is an as-is sale,I think it is a reasonable request...if the seller refuses,you can always install one yourself...if you really love the home that should not deter you...it is an easy fix and not very costly...good luck with your purchase...

760 274 3714
DRE # 01250853
0 votes Thank Flag Link Sun Jul 17, 2011
no heater? that's an odd one. is it present but non operational or did the heater get removed? this happens sometimes in foreclosures...folks strip out the parts. is it possible that you have radiant electric heat with the elements embedded in the ceiling, and maybe someone removed the thermostat? you can check the electric panel for circuit breakers for the electrical feed. your home inspector will show you that.

the "law" says a home with no heater is not habitable, and unless it's a bank repo you are looking at, the issue will arise for the next guy. the big issue you will run into is the lenders appraiser who should be alerted to this...he will want to cite it. the lender will likely decline to loan on the property.

if you made the offer thinking it had a heater you have just hit a speedbump...heaters are not cheap and even if you are a skilled do-it-yourself type many HVAC supply houses will not sell to homeowners.

when something like that comes up it's a red flag for the whole house...it might be that the heater simply went out last winter and they just didn't get around to repairing it but more likely it points to the style of maintenance that the current owner used...i'd love to see the inspection report on this sale.
0 votes Thank Flag Link Sun Jul 17, 2011
They don't have to fix it, but you will not be able to get financing without it in most cases. I would ask that they fix it, they can always say no. Or yes.

Let me know if I can help you in any way!

Joan Wilson (Realtor, SRES, Ecobroker, Certified REO, HAFA, and Short Sale Specialist)

Prudential California Realty
Direct Phone: 760-757-3468
800-975-7481 x 111
Fax: 760-946-7894
License # 01341483

Blog: http://JoanWilsonRealtor.com
0 votes Thank Flag Link Sun Jul 17, 2011
Is the condo a newer condo? Is the heating unit installed but non operational? Is it missing altogether?
I sold a unit in Rancho Carrilo that lacked the heater entirely. Somehow the unit was never installed & the first time home buyer neglected to complain when he purchased new. When I took the listing several years later we were able to go back to the builder to have the missing unit installed. In any case, I would request an operational heating system to be installed prior to the close of escrow. If the seller declines you may decide to cancel your escrow.
Good luck!
0 votes Thank Flag Link Sun Jul 17, 2011
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