Home Buying in 07410>Question Details

Firsttimebuy…, Home Buyer in 07410

Can seller be held responsible for hiding facts post closing?

Asked by Firsttimebuyer1981, 07410 Fri Aug 5, 2011

Upon inspection of the house we were buying, we found that the heating system in basement was not working. Sellers told us that its an electrical heating system and they would get it fixed. During the closing, the heat was still not working and my lawyer kept some money in escrow. Now, when I got it checked by 2 different electricians, they told me that is is in fact a water based heating system and that too illegal according to the code; as it is being run thru the hot water heater.
In such a situation, can I held seller responsible for lying? How should I proceed, please advice.

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Firsttimebuyer,
You got yourself into a bad situation. Unfortunately your inspector did not do a great job to inform you about the details of the property you are buying. My advice is to get the best advice possible for your situation which needs to come from an attorney. Real Estate Agents are not legal expert and many agents, even though their intention is to help, can do more harm than good by not referring their customers to the real experts.
Good luck, Oliver.
3 votes Thank Flag Link Fri Aug 5, 2011
You have to consider if the system was "grandfathered" in so long as it remained in place. A lot of times the Codes will change over the years, but a homeowner does not have to bring it into compliance with the new code until it is replaced. Most homes built in the 1970s, for example, are not in compliance with the 2010 Codes (are whatever version has been adopted in your jurisdiction). However, until the item breaks and needs replacement is when it usually must be brought into compliance.

As to what your seller did and did not know, and any remedies related thereto, only a qualified real estate attorney in your city may properly answer that question for you with any reliability. You should contact one immediately.

Jack Gillis, M.B.A., J.D.
Jack Gillis Realty Advisors
Nathan Grace Real Estate, Broker
5619 Dyer Street | Suite 100
Dallas, TX 75206
Cell: 214.718.4910
Email: Jack@JackGillisRealty.com
1 vote Thank Flag Link Fri Aug 5, 2011
1st time,

As described, it doesn't appear that the seller lied about the fact that the heating system was an electric based system.....IF, the hot water heater was an electric hot water heater, since the heat was being generated by the water heater.

The fact that this is a code violation is likely another matter....if the seller in fact knew that this was a code violation you may have an issue. However, the problem becomes one of proving the sellers knew and withheld this information.

Proceed by collecting accurate and provable information that supports your claim. Then consult an attorney with this evidence.

Most reasonable and innocent of wrong doing people would want to do what they could to make it right when presented with these details. It would be most interesting to hear their explanation of the heat being generated by the hot water heater.

Your solution may be as simple as making the seller aware of the situation.

Good luck,

Bill
0 votes Thank Flag Link Fri Aug 5, 2011
Obviously you were told during the inspection that the heating system was not working, so the inspector did his job. At this point you need a really good real estate attorney to handle this legal situation.

Sorry to hear you are having such a bad time with this. Call Tom Van Dam, Esq. 201-664-0868 in Westwood for legal advice on how to proceed. Tell him I referred you. Good luck with this.

Carolynn Monaco
Prominent Property Sothebys
Ridgewood, NJ
201-805-2486 direct
0 votes Thank Flag Link Fri Aug 5, 2011
Firsttimebuyer1981,

First Time Home Buyer, depending on your contractual agreement, which we are not privy to, you may or may not have a claim against the seller. It sounds like to me, based on your description, you agreed to close with escrow being held for the item that was not functioning on the day of closing. In which case, the seller is obligated to fix, repair or replace heating system in order to receive his/her escrow.

When you make a repair to an item that does not meet code, you will have to replace system with one that will. The seller may have lived with something not being to up to code because he or she was not aware of the code changes. It happens more often than not.

The real question for me if I was in your situation is do you have enough money in escrow to motivate the seller to repair, replace heating system accordingly? Or if you find that the escrow amount is sufficient, you may just want to hire a contractor to make repair, replace the system that bring it to code and draw from the escrow. This way you hire the contractor you want.

I hope that helps.
Web Reference: http://www.njretoday.com
0 votes Thank Flag Link Fri Aug 5, 2011
Seek legal help. Your own realtor along with your attorney (if you used one) should have helped you resolve this problem before signing the final paperwork to seal the deal.

Sorry you ran into this problem. But this type of stuff happens and unfortunately sometimes it's a by-product of professionals not doing top notch work. I would approach your home inspection company and ask why they didn't catch the deficiency.

Good luck!
0 votes Thank Flag Link Fri Aug 5, 2011
Sounds like you bought the home as is.

I am curious as to why you would proceed with closing if there was an outstanding defect that had not been addressed? If closing on the home superseded requiring the seller to perform repairs then you should pay for repairs as the new owner.

At this point you have no leverage over the seller because you are now the owner.

Does this look to be the case?
0 votes Thank Flag Link Fri Aug 5, 2011
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