Bob Loblaw, Home Buyer in Reseda, CA

Notice of Abatement

Asked by Bob Loblaw, Reseda, CA Wed Aug 19, 2009

while a property was bank owned, the city came by and gave a notice of abatement because the yard was a mess.While there the city inspected and found quite a bit of non-permitted construction. I spoke with the inspector on the phone and he claims it would cost a large amount to get this stuff up to code. However, the inspector and appraiser both found the property to be in above average condition.

At this point the seller (broker) and their client the bank are being difficult. I had to get very assertive and come in person for them to take any serious action. The owner of the agency claims that they will work with the city to make the deal close. I am dubious about this. They are also offering to credit me my inspection and appraisal fees on a future deal. The thing is, I have lost faith in their ability to steer clear of these types of problems. I am considering legal action. What do the experts say?

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3
Jenny A. Le, , California
Wed Aug 19, 2009
I'm NOT an expert in permits, inspections, and appraisal.

However, I can share with you that I have had a similar experience with my clients: Property is in Anaheim, CA.

The broker follow through in making repairs recommendation to the bank to fix the issues. The broker arranged for 3 bids to cure the issues and submitted all estimates of work to the bank. The bank authorized the repairs.

Me (the buyers agent) I contacted the city planning/pemits department and obtained the history of permits, certificate of occupancy, and inspection reports. I also contacted the assigned city inspector to discuss/verify the information found in the properyt history of permits and inspections. I coordinate with the broker and the inspector to ensure he comes back out to inspect the property timely with our closing time line.

We closed 2 weeks delayed, there were a lof of follow up calls and emails on my part (because the broker was not responding/moved too slow), but we closed!

The point of my sharing is "everyone" needs to work/collaborate together to fix the issues. Everyone is a facilitator to push things along.. Don't mix a business transaction with personal feelings. The bank don't want the house, the broker just want to sell the house, and you want to buy the house. It appears there is a meeting of minds so focus on clearing the tasks so everyone can go to the closing table.

Where is your agent in all of this? What is property worth to you - cost of repairs bringing property up to code vs. the appraisal value vs. a discounted purchase price? How will the appraiser value the property i.e., value with conditions of repairs and inspection or as-is?

Assuming you still want the house, then don't agree to any credit for "future" deals (zero benenfit or value to the "current" transaction.) Get the broker to focus on obtaining bids for the bank to review and approve.

If your transaction if too difficult to cure, then just walk away. Use the building code violations to cancel and you'll get your full deposit back. There are soooo many other properties to consider and many more will come on the market. I am seeing an uptrend in REO listings.

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1 vote
Pat & Steve…, Agent, Westlake, OH
Sat May 28, 2011
The bank is selling the property "as is." That means if you follow through with the purchase, you are stuck with the violations. I suggest you walk away & look for another home. You didn't mention a Buyer's Agent in your question. You should have a Buyer's Agent to represent your interests. A Buyer's Agent is at no cost to you, because the Seller (even a bank) pays your Buyer's Agent's commission.
0 votes
Dorene Slavi…, Agent, Torrance, CA
Sat May 28, 2011
Hi Bob,
In my opinion,I would start to look at another property. There are many to choose from which will not have the "issues" this one seems to have. I would listen to the city inspectors who will have to pass this property once it actually is brought up to code, and yes that can be very expensive, potentially cancelling out the savings of the REO.
Web Reference:  http://www.doreneslavitz.com
0 votes
Hi Bob
By now (2014) the issues are surely resolved. The home in question has been rehabbed by an investor and the overall tone of the neighborhood has drastically improved. As an active agent and investor in this area, I can tell you investors love messes like this. Reseda is an area where you can still do a decent flip, and the transformation only enhances the entire neighborhood. The target demo righ now is young families, and their increasing presence only means good things to come for Reseda neighborhoods as buyers take over from banks and renters.
Flag Tue May 6, 2014
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