Home Buying in Bronx>Question Details

Michele, Home Buyer in Eastchester, NY

We bid on a house that we learned had an illegal bathroom put in. The sellers are trying to sell it

Asked by Michele, Eastchester, NY Sat Feb 9, 2008

as is, without getting the permit and legalizing it. What are the risks involved with purchasing the house as is?

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7
This kind of question is best dealt with by a NY Realtor...practice is different in each areas. here are the implications:

1. Anywhere along the route, the brakes may be put on by the appraiser (and then the bank) who may not be willing to pass it through w/o proper C of O's (Certificates of Occupancy).

2. The bank may be okay with it, but your attorney may be looking out for your best interest and put a contingency on there being full C of O's on the property.

3. If you manage to purchase without the proper permits, when you go to sell it, the onus will be on you for the permits. If it is not legally done, it will have to be pulled out or reconstructed to code.

4. If you put a contingency on it that it have permits before closing, this will affect your taxes...they will go up.

Whatever decision you make is up to you and is fine, as long as you are prepared for the results of your actions.
Web Reference: http://GailGladstone.com
3 votes Thank Flag Link Sun Feb 10, 2008
The risks are putting a lot of time and effort into the purchase only to have your bank say they won't lend you the money for the purchase. I've seen this happen a lot of times. A bank will do a title search to verify ownership and what is actually legal compared to what is actually in the house. As NYC may march to a different drummer it's best to check with the city. Usually it's not a big deal to get a bathroom legalized after the fact. It requires getting a building permit, having a plumbing inspector and electrical inspector come in and inspect and then having the building inspector come in. A certificate of occupance is issued after all inspections. This is generally how it works in towns north of NYC.
Don
Web Reference: http://www.nyhomeseller.com
1 vote Thank Flag Link Sun Feb 10, 2008
does adding a bathroom increase your taxes?
Flag Mon Jul 14, 2014
As Gail said, "This kind of question is best dealt with by a NY Realtor...practice is different in each areas."

People make improvements all the time without permits and have no problem. But when it comes right down to it, most of the time this is considered BREAKING THE LAW. It could be considered Tax Evasion, fraud or who knows what else. For example, if you knowingly buy stolen merchandise than you are an accessory to the crime. I'm not an attorney, govt official or even a real estate agent. I'm just answering your question as a possible (although unlikely) risk.

So my question to you, Michele, is what are your plans if you buy the home? Are you buying it to fix it up? Are you buying it move-in condition? Is it priced based on this bathroom counting or not counting? Do you need this bathroom? Gail also brings up a very good point about the taxes increasing based on an improvement made to the home. Would an increase in taxes be a strain on your budget?

I'm not saying you should not buy this house, this could be your best opportunity for renegotiating and getting a great deal. You've already taken the best first step by getting brainstorming answers of possible risks that you, your agent or your attorney may not have considered. Good luck with your continued investigation.

Oh, in searching for a good link it brought up an issue I had to deal with. I call it opening a can of worms. An inspector has the right to make you upgrade more than just the bathroom to CURRENT building codes. If you don't make improvements, existing conditions are usually "grandfathered" in as long as it met code when the improvement was originally made. For example, code today (and for years) requires that bathrooms have GFCI electric outlets. So that means you need an electrical permit which then opens the can of worms to your entire house possibly needing ALL the electrical work upgraded to current 2008 local and international code. I've bought several old homes (pre-1930s) and they have had cloth covered wires which today is considered a fire hazard. Everywhere I have lived (in Illinois) at that time, you could buy and live in a home with this wiring and 60 AMP fuse panel as long as you didn't touch any of the electric. Once you make an improvement, all the wiring may have to be replaced. In some towns, however, that is now changing and a sale must meet some minimum safety requirements such as circuit breakers instead of fuses.

So I would absolutely talk to the building department before preceding.

Ruth
1 vote Thank Flag Link Sun Feb 10, 2008
Ruthless, Other/Just Looking in 60558
MVP'08
Risks? No risks really, aside from the fact that the lender will probably not count it as an extra bathroom as far as house value goes.
What you should do is go to a building department in the city and ask a building inspector how one would go about this situation. Since it is already built they will likely be willing to legalize it as long as it was built in compliance with building code.

So, either ask sellers to do it themselves (can be a contingency in your purchase and sale agreement that they need to do that before closing) or get them to make an appointment and come in with the building inspector, see if he feels it was built correctly and what possible issues might come up if you try to legalize it.
1 vote Thank Flag Link Sat Feb 9, 2008
Check with the county to find out what they would require. If the owner is discounting the price adequately to allow for that you should be OK to do the work yourself. However, an issue like that usually only comes up when you sell.
0 votes Thank Flag Link Wed Aug 22, 2012
In Seattle that would not be uncommon. Many contractors who are licensed adn bonded will encourage you to skip the permit process because it can add a great deal to the cost and timeline of the project.
0 votes Thank Flag Link Mon Jul 30, 2012
what to do about illegal bathroom
0 votes Thank Flag Link Mon Jul 30, 2012
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