Unpermitted Construction – Selling or Buying a Home

The link to the article below relates primarily to a home sale, but it applies to any asset purchase.  The author does an excellent job in the sequence and key points in each step of the process.  The source for this article is Nolo, an organization created to help consumers and emerging businesses get answers to legal and business questions.

 Let me start with an (almost) absolute.  In business, no one likes surprises.  Perhaps among the most important considerations when purchasing a home is the avoidance of any unknown cost.  You know when you do your due diligence on a home purchase the list of variables is long.  You will have an inspector come out, look at aspects of a home that can include the age of the roof, appliances, structure, cracks inside and outside, HVAC system, water pressure, insulation, maintenance contracts, shrink soil (depending on where you live), termites, etc.  Frankly, it is a very long list. 

However, I seldom note where anyone suggests checking the permits issued.  The link is to an article explaining the reason for checking the permits issued on a home.  It is very important to what was done in addition to the original work and was it permitted by the local governing authority.

Why is this important?  Because as the owner, you will likely be responsible for any addition not in compliance.  So, you as the new owner must pull the permit or permits. You may have to pay a fine and pay for any additional work required.  What a nasty surprise.

 Please note that this also applies to a buyer of a business asset. It can be a building and/or parcel.  A wise buyer will check and see what permits have been pulled.  Do the permits match the additional work done?  If not, it is a question for the current owner and possible negotiating point.

 I will have a follow-up to this post within the month.

Kudos to the author of this post, you are told what to look for and how.   Link to the article:  https://www.nolo.com/legal-encyclopedia/discovering-unpermitted-construction-when-selling-your-home.html\