Home Buying in Fremont>Question Details

dsyriak, Home Buyer in Mountain View, CA

What are the consequences of buying a property in which remodelling done without permission??

Asked by dsyriak, Mountain View, CA Tue Feb 11, 2014

The remodelling is changing the location of kitchen counter and sink They moved the counter and sink to a different location. Is permit needed for this work?? If so, what are the consequences for me if I buy this property???Any help appreiated...

Also, what are the issues with rent back of property...Any insurance issues do I have to disclose it when getting insurance???

Help the community by answering this question:


Hi Dsyriak,

You have great answers here :) I am mortgage loan officer , I will share you our financing guidelines that will allow illegal additional unit.I hope this answer helps :) I have come across with clients that had double kitchen and it has to meet below criteria to be accepted.

A one property or two unit property that includes an illegal additional unit or accessory apartment (sometimes referred to as a mother-in-law,mother-daugther,or granny unit.)

*The illegal use conforms to the subject neighborhood and to the market
*The property is appraised for the mortgage without considering any rental income from the illegal unit.
*The appraisal must report that the improvements represent an illegal use
*The appraisal report must demonstrate that the improvements are typical for the market through an analysis of at least three comparable properties that have the same illegal use
*The lender ensures that the existence of the illegal additional unit will not jeopardize any future hazard insurance claim that might need to be filed for the property.

You can reach out to me anytime if you have more questions:)

Best Regards,

Joanna Ramos
Loan Officer
NMLS# 868529
Cell: 415-823-8027
Fax: 855-622-8174

Email :Joanna.Ramos@Banchomeloans.com

Website: http://jramos.banchomeloans.com/
0 votes Thank Flag Link Sat Feb 22, 2014
Hi Dsyriak,

I've closed a couple of loans recently with additions and structural changes that were done without permits. So, financing is available, however, as stated by others, you could run into problems with the city and/or insurance and resale could be a problem.

~ Best wishes, Elva A. Wormley, Mortgage Consultant, (408) 615-8500, elva@elvawormley.com,
C2 Financial Corporation, 2845 Moorpark Avenue, Suite 209, San Jose, CA 95128, NMLS #331981 / BRE #01274093
0 votes Thank Flag Link Tue Feb 11, 2014
Hi good answers below just wanted to add, depending on what the remodel is the city could make you either get it permitted or take it down. I had a client that told me when they bought their home it had a studio apt. added on to the back of the garage. The only part with as permit was the bathroom. They had to remove the stove and sink in the kitchen area. Dawn
Web Reference: http://DawnRivera4Homes.com
0 votes Thank Flag Link Tue Feb 11, 2014
Hi Dawn,
I agree, I couldnt help my client in milpitas even if the house was new construction built in 2009, they install a 2nd kitchen with no permt. There was no comparable homes that had double kitchen within his area. His goal is to refinace and get a fixed jumbo product. Unfortunately he has to remove the kitchen in the entertainment room for him to refinance. You can read the guidlines in my answer to Dsyriak question.

Let me know if you have clients that might fit our guidelines thank you:)

Flag Sat Feb 22, 2014
Hi dsyriak,
Appraisers are not allowed to provide value on unpermitted work; conversely, unless you correct the situation, you will have to disclose this this fact to future Buyers as well.
0 votes Thank Flag Link Tue Feb 11, 2014
I would have to say that Alex nailed it. It could end up costing you in long run. They money you spend could be used to purchase a home without those issues.

Keith L. Bosworth
Arise Realty
0 votes Thank Flag Link Tue Feb 11, 2014
Well you will not be able to get a loan for unpermitted additions on a property, unless you want an FHA loan. And in terms of insurance if something from the unpermitted addition is the cause of an insurance claim they will deny it. Also, when it comes time to resell you will not get the value as if it were permitted. Email me if you have any other questions.

Alex Greer
Loan Officer
NMLS #1056079

0 votes Thank Flag Link Tue Feb 11, 2014
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