Is it possible to demand compensation for a non-disclosed defect, sold as is house?

Asked by Wee, Concord, CA Mon Jul 21, 2008

In Dec 2007, bought a fixer REO SFR. Sold as is with missing doors, kitchen cabinets, electrical and plumbing fixtures. Got a house inspector and found no major defects.
While fixing it, found that the clay main sewage line to the street is cracked by the trees. Cost me $6,000 to get a plumber to repait with permit and inspection. I also spent another $1,800 to get rid of the trees.
Called my broker to complain about it but he trys to indicate to me that he can't do anything and don't bother him since it is a done deal. All this occurs in Jan 2008.
July 2008, received a letter from the City, permit for a burst sewage line applied by the previous owner in Dec 2007 is expiring. This indicated that the REO had known about the problem and did not declare it to me. I would not have purchase the house or at least discounted the cost of repairs if I had known about it.
Q1:What can I do? Get a Lawyer; I want to be sure I will win before spending any more more.

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Sarah Menear, Home Buyer, Canada, KY
Mon Aug 11, 2008
I'm having the same type of issue. I bought a house (in Canada) and the seller didn't disclose to us the fact that there are big problems with the downstairs plumbing. The whole bathroom floor needs to be dug up so that we can access the pipes to fix. The seller knew about it, yet didn't mention to us. We had an inspection done, yet he didn't seem to find these issues either. So now we're stuck trying to figure out if she's to pay for this or not. The previous owner (before the seller) did all his own plumbing and didn't put in proper ventilation or S-trap's (therefore the sewer gas can leak into the pipes and into the house). Can we go back to her for compensation?? The plumber we had in estimated a total of $5000 to fix, should she be paying for this because she knew about it? She had plumbers in already a few times to figure out these issues (as she had them when she moved in). The neighbours even said she spoke to them (both sides) about plumbing issues. Does anyone know how this works... Thanks!
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Debt Free Da…, , 85260
Mon Jul 21, 2008
I don't really think there is anything called as is, I believe it is as disclosed. Just because you are selling something as is, doesn't mean that you are off the hook for disclosing.
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Dallas Texas, Agent, Dallas, TN
Mon Jul 21, 2008
The bank may not have known about the permit AND at that time the owner probably did not care since it the banks problem with the foreclosure.

PRIOR contacting an attorney review the docs. READ OVER every document you signed purchasing there are probably 100's of page

Banks formal excecuted contracts may waive the right for you to sue, when you purchased the property. It could save you some money when you speak with an attorney. A legal professional most likely will request for all documents pretaining purchase of the home. The attorney will charge $300 - or + per hour. All bank foreclosures are sold as is ... We have closed numerous foreclosures which the buyer signed their rights to sue. If you locate any statements regarding your rights ask your agent assist you in understanding of the documents. HOWEVER in some states professionals can't comment on a legal document unless they published contract

Seller disclosures are not signed by a bank they never occupied the property have cant furnish any statements.

Sorry to hear everything that has taken place.
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Barbara Wils…, Agent, Danville, CA
Mon Jul 21, 2008
Get a lawyer, but be sure they specialize in real estate law. Normally you would be just out of luck, but with the permit situation occuring before the sale happened, you probably have a case. Though the banks are exempt from the Real Estate Transfer Disclosure Statement, and other owner-occupied disclosures, they are required to tell the prospective buyer anything they know about the property that could affect the value - like a damaged sewer line for which (I'm guessing here) they pulled a permit. Your agent should be helping you here.....
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Marston Myers, , Brandon, FL
Mon Jul 21, 2008
Most attorney's will give you an initial consultation without charge. You would be very wise to consult with an attorney on this matter as soon as possible.

While you signed many releases during the purchase of the property from the BANK, you may still have a cause of action. The BANK will most likely claim they knew nothing about the problem and this is probably true - the old owner just walked away and informed no one about the problem. Assuming this is the case I would bet the BANK would prevail on this one but without checking you will never know.

This is a good example of why REO's are not necessarily the best deals in town. There is no way a regular property or pest inspection would have found this issue either.

Best of luck and let us know what the attorney says, yes?!
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Susan Wesely, , Saint Paul, MN
Mon Jul 21, 2008
This looks like a "get a lawyer" situation. Who pulled the permit in Dec? I'm no lawyer, but if it was someone associated with the bank (agent/employee/contractor hired by...) you may have a case. At least now you have a repaired sewer liner, right? Best of luck!
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AJ Cohen, Agent, Danville, CA
Mon Jul 21, 2008
Get a lawyer now. It seems to me like a gift just fell to you with this letter from the city now you need the representation to use it correctly.
Best of luck,
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