Foundation damage and other issues
Hello all! It has been a few days since my last post; therefore I have new questions.
In 2006, we purchased a SFH that had been flipped. A few months after we moved in, the house started to crumble around us. It turns out that the under-the-table foundation work the flipper had performed was just enough to hold the house up while it was on the market. The house needed $17,000 in foundation work, then another $5,000 in plumbing issues discovered during the excavation for the piers. (I assume most flippers are not so unethical, and yes, we had an inspection.)
The foundation work came with a lifetime transferrable warranty.
We started renting out the house in 2011. We haven't been inside the house much since then, because we have a PM company (see my other thread in this forum for that background. We are taking over the management as soon as the current lease is up on April 30).
The last time we were inside was early in the summer, right after the new tenants' lease started. We were going to put it on the market for an investor, and our agent wanted to go in and take iPhone pictures (yes, I'll make another thread about HER later). At that time, the house was in normal condition (although I was pretty sure that there were at least two extra adults not on the lease living there).
A couple of weeks ago, our PM company emailed us and said the renters were reporting enormous, 1-inch cracks in the walls from apparent foundation problems.
The foundation company with whom we have the warranty went out to the property last week. We haven't heard from them yet. Will call Monday.
Today, I went over for a walkthrough because I wanted to see these cracks, since the last time we saw the house, it was fine.
It was horrible. There were probably 40 cracks in the walls and ceilings, some of them incredibly wide. The floor is separating from the baseboards. It is hundreds, maybe thousands of dollars in damage. "How long has this been happening?" I asked while walking through. The tenants' daughter piped up, "AT LEAST SINCE THIS SUMMER!" Her mom kind of laughed and didn't answer.
Also, the carpets (admittedly old) were filthy, the walls and molding were really grimy, and the laminate in the kitchen had 1/2" separations between the planks, also unreported.
My husband is furious, and thinks we should keep the entire deposit and require more payment because the damage was exacerbated so badly by the delay in reporting it. It is also spelled out in their lease that they need to water the foundation; there is no evidence that they have been doing so (soaker hoses, etc.).
These tenants call the PM company for small repairs constantly: Running toilets, broken burners, etc. That's fine, but they couldn't bother to tell us that the house was cracking around them?
What are your thoughts on this? We are in Dallas, Texas and have let the PM company handle everything involved with being landlords so far. We have only recently decided to take the reins and begin educating ourselves, so we don't know how to handle this.