Unpermitted work is any major/minor activity or improvements you have done to your house that is not certified by the local inspectors. Any unpermitted work may be considered unsafe, illegal and the quality is not guaranteed. This construction can be a challenge when you decide to sell your house, but knowledge of how to handle unpermitted work can be of great help. As the seller, you may decide to eliminate the unpermitted work, legalize the construction or sell the house as it is.
It is a critical requirement that you disclose the unpermitted construction done to your house. Disclosing unpermitted work is required by law, and selling a house with no permit is illegal and can lead to lawsuits. It is advisable to contact a qualified attorney for any query of appropriate disclosure not addressed in the disclosure form.
Selling House With Unpermitted Work?
The completed work can be demolished for inspection. You as the homeowner will be required to pay for the elimination of any unpermitted work. You can also be indicted with a double price of the original fee for a permit.
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Consequences of unpermitted work
The city inspectors can issue a violation which includes fines and a condition that the local municipality reviews the unpermitted work. This can be costly extra work, especially if the plumbing or electrical inspections need to be conducted. If the unpermitted work fails to pass the inspection, the consequence is to conduct repairs or to demolish the unpermitted constructions entirely.
The insurance policy for homeowners does not cover unpermitted work. This means that the insurance policy will not cover repairs or replacement of the unpermitted work in case of an accident. Also, any injuries caused by the unpermitted work will not be covered, for example, if there is an electrical fire due to the additional unpermitted construction and it ends up injuring your guests or the neighbors, the Owner’s insurance policy may not compensate those injuries.
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How to handle unpermitted work.
Selling a house with unpermitted work as it is and avoiding to disclose the information to the buyer can be a cause of major problems in the future and hence not a very viable option. You can ask for a permit and restore the house to acceptable building codes but can be very costly for the seller. The requirements for a permit majorly depends on your region.
Secondly, you can request a retroactive permit. The seller receives the permit after construction, and during the inspection, parts of the structure can be opened up to confirm the structure adheres to the building codes. If it does not adhere to the building codes, you do not necessarily need to destroy the entire structure. You can work closely with architects and the city inspectors to make the house compliant with the codes.
Lastly, you can still sell your house with the unpermitted work as long as you came into an agreement with the buyer. Some buyers are willing to purchase the house as it is. The buyer has a right to know the status of the house, and so you should fully disclose about the unpermitted work. The buyer ought to sign a disclosure affirming that they know that there is unpermitted work to avoid future problems. The buyer may require a discount to cover for all expenses needed to get rid of the code violations.