Home Buying in 33914>Question Details

Mike Imrie, Home Seller in Cape Coral, FL

A word of warning to all you buyers of bank owned properties - Check all the small print yourselves and dont

Asked by Mike Imrie, Cape Coral, FL Thu Apr 30, 2009

rely on agents. I just got ripped off and had to pay over 6000 usd for hook up fees after closing even though the MLS listing and subsequent sales documents showed that the house was already hooked up! Beware - the bank flatly refused to refund any money even though the Notice of Availability was addressed to them and requested they hook up by latest 4 weeks prior to closing date.

Help the community by answering this question:


I'm sorry that happened to you.

Was your closing handled by a title company in Cape Coral or other local location? Unfortunately, many out of area title companies do NOT understand how the Cape Coral utility expansion is handled. I have had many close in out of area locations and we end up sending them information to make sure everything is handled correctly at closing. If you were working with an agent in Cape Coral they should have let you know about the hook up fee. But unfortunately if they believed that it was already hooked up then they wouldn't know to check for anything else.

NOTE TO ALL BUYERS IN CAPE CORAL: Water & Sewer utilities are coming to ALL areas of Cape Coral. Please check with the city to determine what exactly will need to be paid. The hook up fee is usually around $7,000 and then you have to pay a plumber to complete the work. The actual assessment charge (currently ranges around 15-20K total) can be paid on your tax bill over several years. You can find more information on the city's website: http://www.CapeCoral.net.

Good luck!
0 votes Thank Flag Link Thu Apr 30, 2009
Emmanuel Scanlan ,

Looks like you know your business. Yes I agree about finding Clean outs, problems is, as I am sure you know, not all builders locate in same place, and in this area- Cape Coral (and I know something about this here as I have repaired a friends home, No charge, that had damage because of city water hook up) the hook up to city was a redo- thus you have to find a pipe to the septic, cut it and then run to the new city. Most code it think, says clean out should be 3 feet from outside wall.
Disgruntled has a beef for sure - but the small print said . . .


Now when the small print says HOOKED UP- how is this the Realtors fault?/???

Do we expect Realtors to dig up the yard to find how and where the sewer goes?
are Realtors and inspectors responsible for paperwork down at the bank they can't get too nor inspect?
hey if the document was in my hands and I did not report same - hey it my fault,
but if its on the banks desk un-disclosed (and Disgruntled this should have been disclosed to you - see your lawyer)
I as many of my fellow Realtors do, hate to see someone get screwed as it looks as happen here. It reflects on us all. But if Disgruntled would have checked the small print, it says HOOKED UP!
The bank knew it was not and if city had put a lean on the property - then the closing agent should have found as a lean. Maybe the closing agent has insurance to cover- if the county had a lean for the work done.

0 votes Thank Flag Link Tue Dec 8, 2009
Mr. Bennett,

Thank you for asking the question of Kay. All to often we Inspectors get beat on for items that are hidden and out of view. In this case there are ways though that the Inspector may have potentially been able to identify what type system the home had (i.e. city sewer or on site septic). It is unfortunate though that many Inspectors choose to take the out of "It is not in my Standards Of Practice (SOP) and therefore not a required check" excuse. That excuse is of a "Minimalist Inspector". That type of Inspector does little to help the client.

For this explanation I will use the expectation that in Cape Coral area the septic systems were in the rear of the home and city sewer hook-up is in the front of the home. I am familiar with some areas of Florida where that is the case. Also I would expect that in Cape Coral this is a potentially common incident as they are currently transitioning from septic systems to city sewer.

Septic systems, if originally properly installed, would have two cleanouts located just outside of the homes wall where the main building drain exits and heads to the septic tank. In general these are PVC pipes (could be cast iron or other types) with removable caps for snaking and cleaning in both directions. Older installations may only have one. Since septic system replacement is a major action it would be covered by current building codes in place for that area. All building codes I am aware of would require a pair of new cleanouts to be installed on the new main drain line to the city sewer system. Therefore, under the conditions outlined above, there should have been two cleanouts located in the front of the home for the city sewer hook-up.

There are requirements for old septic systems to be properly deactivated. The most common is to cap and seal the main building drain near the home and either remove the old tank and plumbing outside or properly pump, clean and fill them so that they can not hold runoff water and potentially leach out in the soil. In addition there may be a requirement to maintain a written certification in some location to identify that the removal was properly performed. That is generally in the local health department records.

So to identify if the home had been hooked to city sewer the Inspector could have looked for two sets of cleanouts. Or they could have looked for a set of cleanouts in line with the new city sewer line. If two sets of cleanouts were in place and it was unsure which way the sewage was flowing a quick check can be attempted. Turn on a couple of faucets in the home, remove the exterior main drain caps and see in which pipes the water is flowing. I pull these caps on septic systems just to check for backups indicating a potential problem with the system. It is also a good test for this situation as well.

As to the question of what the Inspector may or may not be responsible for would require knowing the following. Were the main drain lines on separate sides of the home as described above? Did the client have a written contract for the inspection? If a written contract was used, what did it contain? Did it contain references to what would and would not be inspected (could have been in the form of a reference to an SOP)? Did the inspection report make any mention of any items noted above, any reference to having a septic inspection, any references that the Inspector could not determine the current conditions?

As previous posts pointed out there is also the potential for recourse against the listing agent, Title Company and potentially the buyer's agent if they were aware of local conditions and did not advise the client of these things.

Hope this helps. If anyone has specific questions please feel free to email them to me.

Emmanuel J. Scanlan
PS Inspection & Property Services LLC
214-418-4366 (cell)
TREC License # 7593
International Code Council, Residential Combination Inspector #5247015-R5 (Electrical, Mechanical, Plumbing and Building)
Certified Infrared Thermographer (ASNT-TC1A Standards)
Texas Residential Construction Commission, Third Party Warranty Inspector #1593
Texas Residential Construction Commission, Inspector, County Inspection Program
Texas Department Of Insurance, VIP Inspector # 08507061016
Hayman Residential Engineering Services, Field Technician
CMC Energy - Certified Energy Auditor

Knowledge is power, but sharing knowledge brings peace!!
Web Reference: http://www.psinspection.com
0 votes Thank Flag Link Thu May 7, 2009
I would think all Realtors (Brokers) have E and O insurance.

Realtors mess up, far to often for my liking, I could go on for some time about this, but this is not the forum to do such.

I would be in favor of a MUCH harder way to be a Real Estate agent.
Disgruntled, don't you just hate insurance agents????? ME too!
I hope all works out for you, I would think the E&O would cover your costs.

And Kay, How does Home Inspector "See" the septic is hooked to a field rather than the city.
0 votes Thank Flag Link Thu May 7, 2009
So we took the advice given and requested the sellers agent to file a claim on their O& E insurance. One week later and not even a reply ! This does not give confidence to potential buyers especially in the unusual Cape Coral market where assessment and hook up fees are a grey area and can add thousands to the listing price if not handled correctly. If the O&E insurance is in place as a means of client protection why not apply it when necessary instead of applying the "Ostrich" principal. Do all realtors have this O&E and how often is it used?
0 votes Thank Flag Link Thu May 7, 2009
A request to the city will tell you whether everything has been hooked up or not - I'd be happy to email you a copy of an example. When the hookup hasn't been complete, impact fees and permits are overdue and they stamp the number for the connection dept on the payoff request. Patricia Sorrels at the connection dept is a VERY nice woman, I'd also be happy to send her info to you as well.

I would definitely contact a real estate attorney as I can't give any legal advice. Hopefully your agent is able to help and I'm always around if you need any extra hand.


0 votes Thank Flag Link Thu Apr 30, 2009
Hi Danielle

The MLS stated that the water / septic and irrigation were central and a percentage of assessment was still due. I was made fully aware of the assessment and that I could pay this on taxes. However it turned out that although water was hooked up the septic and irrigation were not. The home inspection did not pick up on this. I had to dig the front yard up and get plumbers to hook up. It was a disaster. Its OK saying the bank or seller agent is at fault but when they refuse to do the decent thing what next? Its a case of the big fish eating the little one! All you buyers out there don't get swallowed - do your homework. I am sure that I am not the only one this has happened to
0 votes Thank Flag Link Thu Apr 30, 2009
I agree with Susan as we both work the Cape Coral market. I'm very sorry this happened to you and it IS very frustrating. I don't ever trust what listing agents put on the MLS and always do my homework prior to an offer by requesting a payoff directly from the city. I had some clients who were almost in a similar situation with the property being listed as having NO assessments on city water/sewer and come to find out, none of the assessments had been paid. There was a total of 21k plus the cost of plumber.

See if your agent can get a copy of the MLS sheet that states there aren't any assessments and it was already hooked up. If that's the case, the list agent should be responsible for that information. If the property was listed with no assessments and being on city water/sewer, the bank or list agent very may well have to pay for it.

Definitely contact a local real estate attorney. Our local association uses a reputable guy who definitely knows his real estate law.

Best of luck!
0 votes Thank Flag Link Thu Apr 30, 2009
It is always a good idea to confirm with the city/govt entitiy that handles the sewer to see where things are. In the Spokane area, if you are in an area scheduled to get sewer but it has not come in yet, you want to know that. It will cost about 1200-2500 for the work and about 5k for the "right" or obligation. IF it was coming, but not yet done, the lien may not show. Here, you will not have a choice other than hook up today or hook up within, I believe, 2 years. If you never do, you will still be billed monthly and still have to pay the hook up fee.

I had a hundred year old house the city said had been hooked to the sewer system based on a "dye test". It had not. The city had claimed it was, therefore, they had to pay the bulk of the costs of hookup. Thankfully, we checked. You always check with the responsible authority, the city in that case. The problem in the quesioner's case is this check was not made.
0 votes Thank Flag Link Thu Apr 30, 2009
If the lien was placed on the property before you purchased it, you have a title claim. If the lien was after you purchased the property your battle is with the Listing Broker who submitted incorrect information into the MLS. They will have Errors & Omissions insurance and also your Home Inspector who should have seen that it was still operating on a septic system. A lot of communities will require a new Buyer to "hook up" when city services are available to enable/encourage the utility companies to look to the future.
0 votes Thank Flag Link Thu Apr 30, 2009
Let me see if I understand you correctly, John B. and I are reading something totally different I believe. You bought a REO had a home inspection, got your deed restrictions and covenants, got a title search & policy, move in and the house was not hooked up to city services as documented in the MLS. They hooked you up and requested payment and refusal would justify a lien on your property?
0 votes Thank Flag Link Thu Apr 30, 2009
Susan thats a great reply and good advice to future buyers. Pity it was too late for my particular situation. Yes I used Cape Coral Title company and my own reputable local buyers agent who was absolutely brilliant but was also misled by the incorrect info submitted by buyers agent and bank. I have a claim in at the moment with title insurance company which I hope will be successful.
0 votes Thank Flag Link Thu Apr 30, 2009
Suean, Would not a Title agent might have some issues it they failed to uncover such lien, regardless of location of the closing?

This is yet another example where a local Realtor comes in handly to have help a buyer. Bet Susan would have been all over the issue.

0 votes Thank Flag Link Thu Apr 30, 2009
And Kay, I dint think home inspection includes lien searches.

I did not state this clear enough - your Title search/ title insurance MIGHT be on the hook
for this.
See your Lawyer.

0 votes Thank Flag Link Thu Apr 30, 2009
You need to check on your title insurance. I know you blame the agent, but we are not experts on title
searches, its above our level. We depend as you do, on the title people to uncover such.. You mAy have
recourse there.
It it was represented the house was hooked up, you may have E&O claim against agent.
Yes, you should not rely on Real Estate agents for Title Searches.

A Call to a local Real Estate Lawyer should clear this up.

Sorry you have problems.

Did you use an agent for your side???
Or just the selling agent??
0 votes Thank Flag Link Thu Apr 30, 2009
No it was never disclosed. The first we knew was when a lien was pinned to the door forcing us to pay for hook up of septic and irrigation and get the work done. Yes we paid for a home inspection report.
0 votes Thank Flag Link Thu Apr 30, 2009
Was that not disclosed in the covenants and deed restrictions or at any time in the inspection reports, etc.? Did you have a home inspection?
0 votes Thank Flag Link Thu Apr 30, 2009
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