I’m currently closing on a deal in Maryland. The seller remodeled the unit and added a bathroom. My offer contract has a contingency clause that the seller has to obtain the bathroom permit before closing. After government’s inspection, seller realized that he used a plumber outside of the city while it is mandated that he has to use a plumber licensed in the city. He is looking for local plumber to sign off the work.
My question is what are the risk involved in buying a property like that - will I come across insurance issue? Legal issue? What are the hidden liability that I need to watch out for?
Signing off on the work means that the new plumber is stating that the work was done up to the required code in your area. The government is trying to have control over who does the plumbing work in its jurisdiction in an effort to increase the standards for plumbing in that area.
By using someone outside the city, the seller has violated whatever ordinance applied. By purchasing the property you could be inheriting whatever liability comes with that. Maybe a fine, or a lien, but more likely a requirement to have the work inspected and possibly fixed. The inspection part is where the signing-off comes in. If the local guy gives the OK, then you should be good to continue. Talk to your insurer, but as long as the work was done by a licensed plumber, I suspect they will give you the green light. I'm not an attorney, but I think you will enjoy the same liability protections after the 'signing off' as you would have had the seller used a local plumber.
Make sure the sign off is done before closing then feel confident in going ahead with the project.
@Benjamin Aaker Thank you Benjamin for your suggestion! I will reach out to my insurer.