Buyers: Why Permits are Vital and Help You Avoid the Headache

Buyers: Why Permits are Vital and Help You Avoid the Headache

After an exhaustive search viewing home after home, you’ve finally stumbled across the one. This is your dream home. It’s in your favorite neighborhood, nearby  the best schools, has an open kitchen with gorgeous granite countertops  and that third bathroom. It completely embodies your lifestyle. You want  it. You need it. You’ve got to live there! Exciting right? There’s no  argument that buying a house is thrilling. So thrilling in fact that you  might forget to consider all the, what I like to call, “details”. One  such detail that many new homeowners overlook are these pesky pieces of  paperwork known as permits. More specifically, permits  for any additions or construction made to a home. But why are permits important for buyers to consider? And what are the repercussions of  buying a home without them? Well, let’s take a closer look.

Resale Implications:

One fact you should know is that sellers are required by law to disclose all information about permitted or unpermitted additions  and construction made to a home. However, not all sellers are created equal and some may not divulge this information upfront. Why don’t they you ask? The most common reason is due to property tax implications. In  other words, procuring permits from the county means paying more to the  taxman. So, what happens if you’ve already purchased your home and then  found out about these unpermitted additions? Hypothetically, you could do nothing. Who’s going to know? Answer: a real estate agent. This route  is ill advised because it will come back to bite you when it’s time for  resale. The details of your home are included in the county records and  MLS listing. And an agent will know something’s up if there’s a distinct difference between what they see and what they read. You may advertise your home as having 3 bedrooms and 2 bathrooms on 2,200 square  feet but if one of those bedrooms is unpermitted, the MLS listing will say otherwise. The outcome will be a decrease in value on your home and  no one wants that.

Avoid the Lawyers:

This leads us to the second reason  permits are important: avoiding legal troubles. If you’ve already bought  your house and realize you have unpermitted additions, your first  question is probably “Who’s responsible for incurring the cost of the  permit?” This depends on your disclosure statement. Did the previous  owners make note of the lack of permits? If so, and if you can prove the  property is as it was when you first bought it, you can plea “innocent  purchaser”. This can be difficult to prove and requires the cooperation  of the previous owner, which might not be easy to obtain seeing as  they’re now responsible for the permit costs (plus any other penalties  and interest). If they are unwilling to assist, you may still be  required to pay the fee yourself. It’s definitely in your best interest to go over the disclosure statement with a fine toothcomb before buying to avoid any future legal woes!

Safety First:

Legal issues aside, the exclusion of construction permits is also a potential safety hazard. If the previous  owners never bothered to get permits, they also might not have cared who did the work. Construction codes are updated all the time and your  home’s additions may not be up to date. Additionally, if a county inspector drops by and sees your home is not up to code, they can come  in like a wrecking ball and demolish the unpermitted additions. No one wants to say goodbye to that beautiful third bathroom! Not to sound like a recording on repeat but… make sure you have those permits. Demolitions are heart achingly costly.

Are there any upsides to not double, triple, quadruple checking for permits? I mean sure, no permits means you can always negotiate a lower price for your home, but after reading  all the above, is it really worth it? Thankfully most agents take it upon themselves to check the county records for permits but it never hurts for you to be aware as well!