Need advice - I bought a bad flip
Member since 2018 · 19 posts · 2 votes
Maybe not the best place to ask for advice - I bought a home in N Central MA advertised as totally renovated, a pristine revival. Among other attributes was a new roof and new high efficiency HVAC. What I've learned since owning the home is virtually everything was done wrong. Yes, I had the home inspected but what has transpired here couldn't have been anticipated. The home was unsafe in part and unlivable. I'm a senior with limited means. The seller is taking no responsibility for his negligence. The work on the home was marginally permitted and minimally inspected by the Building Department. I'm faced with bringing an action I can't afford. Is there any oversight for flipped homes. Anyone I can contact?
Barbara
Barbara,
If you can find out which contractors were responsible for the improper work, there may be some recourse on their Insurance. Normally the poor workmanship would be the responsibility of the contractor to repair not the insurance but if the poor workmanship caused other damage it may be covered. Even the threat of going to their insurance may be effective in getting the repairs. You may find out the contractors if they pulled permits. the owner may know the insurance co. of the contractors.
Since it looks like beuracracy isn't working (they accepted everything to be find) then you might need to use your home insurance if you have it.
Thanks Jackson for the kindness of a reply. Homeowner's insurance did cover the flood in my basement - sump pump drain emptied next to the foundation and water came right back in. But HOs doesn't cover improperly installed doors etc.
@Barbara L Dainoff I would notify the local Board of Realtors and name names of the seller, home inspector, etc. As far as the house goes, I would sell it and disclose the problems to your agent. These problems will not get better with age.
Barbara,
If you can find out which contractors were responsible for the improper work, there may be some recourse on their Insurance. Normally the poor workmanship would be the responsibility of the contractor to repair not the insurance but if the poor workmanship caused other damage it may be covered. Even the threat of going to their insurance may be effective in getting the repairs. You may find out the contractors if they pulled permits. the owner may know the insurance co. of the contractors.
To Anthony -
I called the Board of Realtors - seller is a broker and not listed w/them. I've had a lot of work corrected in the house. It took a lot of money to move etc and I've spent half of what's needed going forward. I'm not in a position to sell nor would I have known all that would happen until time passed.
To John -
Insurance is something I hadn't been advised of other than the seller/flipper is a real estate broker and would hold insurance. I know the names of the most negligent contractors - the general one and HVAC. The work was so bad I didn't want the same folks to come back. If I can figure out how to post my experience I'll copy and paste.
Thanks for the advice.
I wasn't able to move in when I wanted to last summer as the A/C wasn't cooling the home. I learned after multiple texts to the HVAC installer he'd left the system inoperable because he feared he wouldn't be paid.
As the water drained following my third shower in my home - the toilet flushed. Plumbers snaked the main and laundry drain finding construction debris as well as rust clogging the lines. Less than a week later I'd found and had a consultant/trouble shooter here - I was uneasy about the home.
I have since learned virtually everything to do with the HVAC system is wrong. Exhaust vented below the snow line - people could have died in this house. Exterior doors weren't properly sized or installed - neither sealed or were actually closed even when locked. Thresholds, twice as high as code allows presenting a trip hazard. The sump pump emptied adjacent to the foundation - water poured back into the basement flooding it with over 6" of water. The roof of the garage was likely to come down with a snow load. The electrical system has been tripping breakers. Most dramatic, as a plumber was working in the basement correcting the furnace vent, the brick underside of the fireplace hearth came crashing down. The new roof has to be stripped and redone as no shingle is nailed correctly. A kitchen cabinet is hung upside down. The tile work in the bathroom has cracked. Unfortunately the list goes on.
Several letters have been sent to the seller's attorney. The seller, his attorney and contractor, my attorney and contractors I wanted to remedy the situation met in my home in early November. Afterwards it was proposed by the seller that his contractor would bring in a crew and knock out the "to do list" in half a day. I couldn't accept the offer. My attorney's letter enumerated my out of pocket expenses and the work yet to be corrected. We've gotten no response although the seller's attorney had said they want to avoid litigation.
I hired a contractor to make my home safe. The work has taken 5 1/2 weeks and as it progressed it was evident that the negligence of the original contractor couldn't have been anticipated. The HVAC system took two and at one point a third techs 3 days to correct.
I believed I bought a home that was move in ready. I'm a senior, with limited income and means. I cannot afford the renovations that had to be done to my home and more work remains.
The seller has "flipped" other homes and he indicated the contractors who worked on my home were workmanlike on other projects. I hope the families who bought his other renovations have homes that are safe.
The seller (removed his name) he now holds a construction supervisor license. If his LinkedIn profile is to be believed his background is in event planning and several other forays as an entrepreneur in similar venues. My guess is he's continuing to flip other homes.
I have also, although only fairly recently, learned that the Building Department, the Commissioner in particular, was remiss. The home was sold at auction from the City of Leominster and slated for renovation. I would expect that a distressed property would be a high priority on the Building Departments radar. It wasn't yet their mission statement is "to ensure the public's safety through proper construction oversight .."and I've suffered.
I have photos documenting all that has gone on here.
I've written a 93A letter to _____ who in response is taking no responsibility for his negligence.
Barbara
Sorry for your predicament. I just wanted to add, although your attorney may have already told you, that most states, I believe MA is one of them, have laws against "elderly abuse" where someone has taken financial, emotional or physical advantage of an elderly person. You said you're a senior, so I wanted to point that out as that may be another avenue to follow, if nothing else, to exert pressure on a proper settlement. Not a lawyer, no legal advice, but my husband's grandparents went through a scam, not housing related, and we found out there are laws in place to help protect seniors.
People have a right to make money, a profit. It could be said there's something noble in bringing a home back and improving a neighborhood. Pretty much everything that was done improperly in my home would have cost a minimal amount of money to do correctly. What stymies me is why buy materials ie roofing shingles and install them 3" off the nailing line that's clearly marked?
Lynn M - Thanks, we hadn't considered that. Boston Globe editor referred me to AARP, unfortunately the fellow who might be helpful is traveling and not available for possibly 2 weeks. I'll look into this.
I found the quote below in a recent article on Bankrate. Would anyone know if responsibility is implied or written somewhere? I appreciate the responses - Thank you!
Karu says house flippers have a moral and financial obligation to make their flip safe.
“You are responsible for maintaining the safety of a home; that’s what codes are for,” she says. “It’s got to be safe because you’re liable for at least a year for the safety of the people living in the home after you finish it.”
@Barbara L Dainoff I think your attorney is on the right track with a 93A action. It's quite possible that the seller could be on the hook for treble (triple) damages. The most obvious theories are "unfair and deceptive trade practices", the "implied warranty of merchantability" and "fitness for a particular purpose", but your attorney will know all that.
I would push your attorney to pursue that avenue aggressively as it sounds like you'll have a very sympathetic face in front of a Magistrate. I hope you have a pitbull of an attorney representing you!
It sounds like the home inspector may have missed some obvious things. The placement of the sump pump outlet and the HVAC exhaust seem painfully obvious. I can't speak to the rest, but if the home inspector really did miss things he should have caught, he might be on the hook for damages as well.
One immediate step is to photo/video document EVERYTHING so you'll have evidence if you go to trial. You might also pay for another home inspection for additional evidence. Ask your attorney about that. It should cost under $400.00.
The other thing that might be worth a shot is to call WBZ's Call for Action (you'll have to google it - I BP does't allow posting of phone numbers here). Likewise a call to any of the local news stations investigative reporters.
A TV news story about a real estate investor screwing the proverbial little old lady (no offense intended) will get a lot of eyeballs.
I don't know that you'll have much success going after the contractors as you were not their customer. That's a attorney question though.
Another point. A "Realtor" is simply someone who is a member of the National Association of Realtors (NAR), which is a trade group.
If you called your local Board of Realtors and they didn't have him listed, that just means that he's not a member of NAR. Membership is not required to sell real estate in MA - but a license most certainly is.
The place to call to report unfair dealings and/or misrepresentation is the Mass. Board of Registration in Real Estate. The same holds true if the home inspector did a sub-standard job as they're also licensed by the state. Here's a link:
https://www.mass.gov/orgs/board-of-registration-of...
Finally, the seller / broker is required to disclose that he is a licensed real estate professional PRIOR to signing an offer to purchase with you - even if he's selling through another party. If that didn't happen, he's in a world of hurt. Again, a complaint to the Board of Registration in Real Estate is the way to go. The seller could easily face fines, suspension or lose his real estate license altogether.
Good luck. If you want to chat, please remember that I am not an attorney. But feel free to call if you have questions.
Charlie - All helpful but I believe I pursued many of your suggestions. Seller is a broker, no longer holds an agent's license. In the P&S I bought the house from his business inc.
NBC Boston ran a consumer 3 minutes on my tale of woe but the seller's name wasn't aired, a last minute change from legal. Unfortunately, thinking a TV report might make seller come to the table, I lost 2 months - all the snow in March delayed it. Photos that were used weren't correct in terms of the verbiage - I wasn't asked. I had contacted all the TV consumer reporters and was told by all if lawyers were involved they couldn't help. Now the Boston Globe's consumer reporter is thinking about it.
I called and spoke with the owner of the company whose home inspector I'd hired. He's on the board that writes the building codes - I didn't get too far w/him other than a referral to someone in a similar position in central MA.
The Commissioner of the Building Dept was inept.
My attorney is not a pit bull but he's followed me from the closing and hasn't charged me a all. Letters written, meetings etc. He's as angry as I am. So I want to stick w/him. Financially, I'm strapped.
I'll reread what you've written and thank you so much for taking the time and interest in helping me.
Eric - Thanks. The market was tight last year with homes selling on the eve of the OH. My home inspector wasn't affiliated with the seller. He picked up a long list but missed the vent.
A consumer advocate I'd contacted wondered if the CO was bought from the city. It was issued w/o the new HVAC system inspected. A permit had been applied for then denied.
Almost every home inspector will have some sort of "release" or waiver that will be signed prior to the inspection. Talk to you lawyer, where I live, most waivers and release of liability forms will not hold up in court but it may be different in your region. They're used to discourage lawsuits.
Seems like after the fact you did a lot of research on the property. The only good I can take from that is this may be a lesson for others, who need to do the same. Many people on here buy properties sight unseen and rent them out not knowing they're now liable for any issues with the property. I really can't stress it enough how important it is to do your research prior to purchase.
You mentioned that you may not be able to afford litigation or the repairs. Leaving you stuck sucking on this lemon. The one commodity you have right now is time. If I were you I would look at this from the flip side first. Talk to a different lawyer but as if YOU were the flipper. Talk to them saying you bought and sold a property and now the new owners are coming after you for issues with the house. See how a lawyer reacts. In my own personal experience there's what's right, what's fair and what's legal. A lawyer will help you out on the things that are legal... but they're many are sales pitches. They prey on the fact that you think something isn't fair and are happy to retain services and go to court. So talking to another lawyer from the perspective of the "flipper" may give you some preparation as to what you can expect if you take this to court.
Also with all your time I would use it.... see if you can take the owner into small claims court for each and every issue your house has. Nothing would make me want to resolve an issue more than the prospect of spending the next 2 months locked up in court hearings. You could take this one step further, since you now have improved your research skills, look to see if any other properties in the area are on title with this "flipper" you have worked with. If/when those properties come up for sale what's stopping you from sitting on public property adjacent to the one up for sale with a "buyer beware" sign and hand out leaflets with your own personal story.
I suppose what I'm saying is you could either let this eat you up ... and you can be the thorn in this person's side... or you can roll over and take it... I wish you the best of luck in which ever direction you choose to take!
@Barbara L Dainoff If he's a broker, he's still licensed and still regulated by the state.
Just to clarify, there are two types of real estate sales licenses in Mass. A salesperson's license (which I hold) allows me to assist others in transacting real estate under the supervision of a managing broker. A salesperson can only work under the supervision of a broker.
A broker's license (requires 3 years of salesperson experience to sit for the exam) allows one to work on his own, handle escrow funds and open his own brokerage.
BTW - I misspoke earlier. There is a separate Board of Registration of Home Inspectors. It's not the same group as the Board of Registration in Real Estate.
This should be a link to a list of all licensed home inspectors in MA (seems to be down at the moment)
http://license.reg.state.ma.us/public/v_list_hi.as...
If the fact that he's a broker wasn't disclose PRIOR to the offer, I think you still may have a strong point of leverage, even if it was sold through an Inc.
You might consider building a case and suing him personally, meaning that all of his personal assets could be at risk.
As an "Inc.", he theoretically has some protection, but my (somewhat distant) memory of business law is that the so-called corporate veil (protecting the shareholders of the corporation from personal liability) can be pierced by any number of methods and fraud is one of them.
Again, this is an attorney question, but if I were an attorney (and I'm not), I think I'd assert fraud in this case. There are other ways of piercing the corporate veil, outlined in this link at nolo.com:
https://www.nolo.com/legal-encyclopedia/personal-l...
I understand that your attorney has been a peach in this case, but maybe it's time for that pitbull.
Charlie - all great info. Thank you. What about the Building Dept - their mission statement is to protect against poor workmanship and ensure safety. Would you have any idea if they're liable? I've made a complaint w/the city and with Mass Public Safety.
Reed - Local politicians, that's an avenue I haven't tried. Thanks!
@Barbara L Dainoff I don't know how / whether you could hold the town liable. I've never heard of it being done.
Thanks to everyone who offered thoughts and advice. I'm most appreciative! If anything else comes to mind please share.
Thanks again -
Barbara
Hello, Monday morning and hoping to avoid a costly (I can't afford) and long (again, can't afford) legal action. Have read all comments and suggestions although on a Monday morning difficult to reach 1st, local city offices and state representative and senator from my district. I have left messages and sent email.
I'm not asking the seller for a lot of money. For me it was money to use going forward for my expenses not for rehabilitating a newly renovated home. I've spent $24,000 and it's estimated the house needs approximately another $25K. In the 93A letter I asked for the $49,000 plus legal expenses. In his response the seller wrote the city Building Dept signed off on the renovations (marginally permitted and minimally inspected - no doubt the commissioner was remiss. I've filed a complaint against him with both the city and MA Public Safety. Doesn't help me financially but perhaps someone else.) his Inc would allow me to sue the contractors he hired. He also included #20 in the P&S, signed months before I'd had possession of the home, and None follows it.
Received a note this AM from the consumer reporter at The Globe saying he'd spoken about my situation and would take it up next Monday. He's on vacation for a few days.
Any thoughts, suggestions are appreciated.
Barbara
Hello, Monday morning and hoping to avoid a costly (I can't afford) and long (again, can't afford) legal action. Have read all comments and suggestions although on a Monday morning difficult to reach 1st, local city offices and state representative and senator from my district. I have left messages and sent email.
I'm not asking the seller for a lot of money. For me it was money to use going forward for my expenses not for rehabilitating a newly renovated home. I've spent $24,000 and it's estimated the house needs approximately another $25K. In the 93A letter I asked for the $49,000 plus legal expenses. In his response the seller wrote the city Building Dept signed off on the renovations (marginally permitted and minimally inspected - no doubt the commissioner was remiss. I've filed a complaint against him with both the city and MA Public Safety. Doesn't help me financially but perhaps someone else.) his Inc would allow me to sue the contractors he hired. He also included #20 in the P&S, signed months before I'd had possession of the home, and None follows it.
Received a note this AM from the consumer reporter at The Globe saying he'd spoken about my situation and would take it up next Monday. He's on vacation for a few days.
Any thoughts, suggestions are appreciated.
Barbara