Vilolation of Ocuppancy ?

5 Replies

I’m currently in Escrow and my lawyer has just notified me that there’s a violation of occupancy from the town on the house I want to purchase, violation is for renting out illegal basement. What would you do as an experienced investor?

If you plan to rent it out make sure that basement renter is gone before you close. If you plan to live there make sure the property is empty before you close. After that simply contact the city and say that person is gone, are there fines due< if so how much, and collect from seller. 

Make sure your investment plan (if it’s going to be a rental) works without basement rent. 

@Christina Acevedo , I would start by asking more questions of your lawyer.

1) How did your lawyer find out about this?

2) What makes the basement non-compliant?

3) What can be done, if anything, to make the basement compliant as a rental? It might only need to be inspected or it may need upgrades such as egress windows.

4) Does your sales contract to purchase the home address this issue? Ask your lawyer what your recourse it with regard to the sale.

Lots of questions to ask before you can try to make informed decisions.

Make sure seller is paying any fines off as part of closing.

Make sure seller has terminated that renter's lease at his expense. In some states, you have to recognize any lease that is in place. 

Was it part of your investment plan to rent the basement? If it was key to your strategy then talk to your lawyer about getting out if remediation of the basement is not possible/too expensive.

@Christina Acevedo

1. Notify the seller. Ask them if they ever received approval.

2. As others mentioned - was your offer based on that being a valid unit, if so did you put it in as a contingency?