Predatory Remodelling

8 Replies

Found this report of a rehab gone bad. It is a shame that there are contractors that are that bad. I am trying to give the "real estate investor" the benefit of the doubt that he didnt know better, but it is still his fault in the end. 

We should be better than this! 

http://www.hoodwinkedhouse.com/real-estate-fraud-t...

Unfortunately situations like this are more and more common. Today alone i looked at a property that a  sunroom was enclosed drywalled and stuccoed to appear to be a part of the structure. the most recent homeowner bought the property with it that way and now they tear it down by orders of the city before they will allow the property to be sold. 

Holy cow. This is so so sad. But it makes me wonder why the inspector didn't catch more of this stuff. Or at least suspect there was much more wrong from what he did see and advise the buyer of it.

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I would think the RE Agent would be in pretty big trouble to encourage signing the waiver of Disclosure.  I don't think you can even do that in Texas.   I wouldn't think the waiver of disclosure would protect the seller from a suit for fraud either.

I read through the summary, and got only a few days into the entire chronology when I had to stop. As a rehabber, it makes me sick to see the work that was done. The worst thing is, it wouldn't have cost much more to do it correctly. 

My heart breaks for this person, who was betrayed by every single person in this entire transaction.

Originally posted by @Mindy Jensen :

I read through the summary, and got only a few days into the entire chronology when I had to stop. As a rehabber, it makes me sick to see the work that was done. The worst thing is, it wouldn't have cost much more to do it correctly. 

My heart breaks for this person, who was betrayed by every single person in this entire transaction.

 Terrible! These are they types of things that give RE investors a poor reputation and causes gov'mint to pass more laws to "protect" citizens. 

Terrible story but the buyer sites Zillow pics that were date stamped, shouldn't that have raised some red flags when permits didn't show up?  Also, why didn't the inspector see the illegal vent pipes under the kitchen sink? Didn't he check all the outlets? Aren't there supposed to be a certain number of vents per wall space? Why didn't he pick that up? Can he hold the inspector liable?  I would demand my money back for that one.  

How about the broker/agent? It could be argued that broker/agent deliberately committed fraud by hiding latent defects and encouraging buyer to sign a disclosure waiver, thereby, placing buyer in a very vulnerable position. Agents are held to a moral code by their associations (NAR) and brokers assume the risk of an agent's actions. Agents has the duty to provide third party (i.e. buyer) with disclosure of all material facts. If buyer can prove that agent worked with seller to cover up violations and thereby place buyer's life in jeopardy (due to many code violations) he may have another alternative.