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What Options Do You Have When a Seller Hides Defects?

Unfortunately not all Real Estate transactions are CLEAN or SEAMLESS. Oh what a world that would be! Things can go wrong, expectations may not be met, and what looks good on the surface may be deceiving underneath. There are often times questions or concerns that pop up in Buyers minds that can be unsettling, confusing, and all around disturbing. Everyone has heard those horror stories. And sometimes people have encountered them, themselves! The ultimate question is this: Who do you have on your side to protect yourself from these unfortunate circumstances coming true??
I read this article recently that details one of those situations. Much like the Title of this post depicts, this article clerifies something of the same. One circumstance, but so enlightening to those of you who are buyers.
Lets work together to prevent these type of stories from coming true.

What to do when sellers hide defects

Agent shares blame for failure to provide report in timely manner

By Barry Stone
Inman News™

February 01, 2011

DEAR BARRY: We bought our home six weeks ago. The sellers had inherited the property and claimed to know nothing about its condition. After moving in, there was a rainstorm. The roof leaked and the bedroom ceiling became wet. Our home inspector had said the roof was fairly new and in good condition. The termite report, however, disclosed water stains on the bedroom ceiling.

Unfortunately, we did not receive the termite report in time. Our real estate agent never gave us a copy. We obtained one directly from the termite company three days before the close of escrow. By that time, our deadline for negotiation had expired and our belongings were already packed in a moving van.

When we complained to our agent, he apologized for not having provided the termite report, but he assured us that the stains were probably caused by old leaks and were "no big deal." He also insisted that the sellers couldn't have known about the leakage or they would have disclosed it, according to law. But the sellers must have known because they paid for the termite report. Who is liable for the roof repairs: the sellers, our agent, or the home inspector? --Jen

DEAR JEN: The sellers were required to disclose the defects that were listed by their termite inspector, including evidence of possible roof leaks. When you realized that they had not provided disclosure, you could have put a hold on the deal, even though the contingency period had expired.

The sellers had violated their legal obligation to disclose known defects. That violation invalidated the negotiation deadline and now exposes them to liability for repair costs. But they are not alone in their liability.

Your real estate agent is also liable for roof repair costs for the following two reasons:

1. Your agent should have provided you with a copy of the termite report as soon as it was available. There is no acceptable excuse for failing to convey the document. This oversight essentially negated your ability to consider vital disclosure information during the contingency period.

2) Your agent had no business suggesting that the roof leak was "no big deal." That statement was patently irresponsible. Unless he is qualified to evaluate a roof, and unless he walked on the roof prior to making his evaluation, there was no reasonable basis for making that statement. If he had truly been looking out for your interests, rather than trying to close the deal, he should have demanded further evaluation of the roof by a licensed roofing contractor before the close of escrow.

Finally, there is the question of liability for the home inspector. In most cases, a leaky roof has some form of visible defect. If your home inspector overlooked visible roof defects, he could be liable for professional negligence.

All parties involved in this transaction should be notified that there are unresolved issues that cannot be ignored. A second home inspection should be performed by a highly qualified inspector to determine what other issues should also have been disclosed.

To write to Barry Stone, please visit him on the Web at www.housedetective.com.

Happy Weekending!

My Husband and I in Alpine, UT

As I have mentioned before, 

My husband and I are BIG fans of the outdoors.

Even though we are looking at snow/rain/slightly above freezing temperatures,

we are getting giddy for the warmer weather

that hopefully is on its way.

I wish you a Happy Weekending!

hopefully doing all the things you love to do.

I know I am.

The Real Estate Roadworthiness Test

Recently, I read an article in the Daily Real Estate News, that not only summed up my daily activities but did it in a way that I could only wish to express my stories in: It was funny!

I in no way shape or form will be taking credit for Kris Bergs stoke of genius with a pen (or laptop in this modern day and age) but if you have a few minutes to kill, I highly recommend reading this article located:

here.

Otherwise, read on:

The real estate roadworthiness test

Letters From the Home Front

By Kris Berg
Inman News™

February 02, 2011

Is there such a thing as a "smooth" real estate transaction anymore? Some weeks I feel like I spend all of my time yelling out the window.

It's a little trick I picked up in high school. About 87 years ago, when I was 15, my number came up and it was time to take the dreaded "behind the wheel" course. Mean bureaucrats everywhere make this a requirement to getting a driver's license -- even in Texas.

And it was because of this silly prerequisite that I found myself seated behind the very large dashboard of an actual motor vehicle (if you consider a Plymouth Belvedere an "actual motor vehicle," which most serious automobile enthusiasts do not).

I was seated next to an actual driving instructor, or as they like to call them in Texas: the football coach.

I'm sure that driver's training has gotten more sophisticated today. But back then, when dinosaurs and disco roamed the earth, it was pretty basic stuff. We would bring our cars to the empty parking lot and, one at a time, while the rest of the class congregated on the adjacent sidewalk anxiously waiting their turns, we would hit the gas.

Our goal was to maneuver the parking aisles and return to a complete stop. That was the plan, anyway.

On my first outing, I successfully accomplished the hitting the gas part. A recent transplant to the Lone Star State from California, I was a curious foreign novelty, so I got to go first. And having successfully accomplished forward movement, now the lone pilot of what looked like a really ugly combat tank that got 9 mpg, something went wrong.

Maybe it was the adrenaline ("Hey, look at me! I'm driving! Whee!"), or maybe I simply panicked, but in less time you could say "zero to 60," I was suddenly manning a warp-speed projectile with my trajectory set on a good chunk of the class of '77.

Fortunately, Houston is really hot in the summer, which meant I was using the air conditioning. In 1964 Plymouth Belvedere speak, this means my window was open. And, suddenly recognizing that a multiple manslaughter charge might mean missing the homecoming game, I had to react quickly. I yelled out the window. "Watch out!!!" I screamed.

Once the color had returned to Coach's face, I received one of my more important lessons in life. "I don't know how they do things in 'Caly-Forna,' " he barked, "but in Texas, we don't scream out the window when we are about to run over pedestrians. We honk the horn."

He could have just as easily said, "We sound the vuvuzela" or "We sing the National Anthem." Either way, the point was not lost on me. The point is not that you can necessarily avoid accidents. Rather, it's how you react in those situations to avoid catastrophe that matters.

If I am honest, the real estate transactions I am involved in daily are uneventful and trouble-free only about 10 percent of the time. Rather, the bulk of my transactions require that I remain in constant possession of a fire hose.

It's stressful, often confrontational work. There are both checklists and expectations to manage and, as every veteran agent knows, it can affect the best of us by seeping into our personal lives and our general emotional well-being if we let it.

Catastrophes in real estate can come in two forms. The first involves the transaction and the attainment of the client's goals -- they get the house, they sell the house, they close escrow on time, and so on.

This all sounds easy enough, except that the level of difficulty has increased in our profession to the point where even the most straightforward of tasks often leave us feeling like we are running a half-marathon in stilettos.

The lender accepted electronic signatures last week; this week he won't. On Monday, the bank approved the loan only to deny it on Friday, approve it again after the weekend, and -- "Whoopsie!" -- deny it yet again despite that fact that everyone has packed and moving trucks are idling.

Sometimes it's that the buyer who loved the home two weeks ago suddenly lost interest, that the county pulls the recording at the last minute because there was a smudge on page 142 of the documents, or that no one saw that cracked slab or toxic mold coming. Whatever the issue, the one thing we can count on as agents is having issues.

These little transactional crises are actually the easiest for me to deal with. But like driving, it took some experience. Now, after more than a decade of practice, I have become pretty good at remaining clinical -- at emotionally detaching -- when the glitches occur.

Much harder for me, however, are the issues involving relationships, and so much of our success relies on successfully establishing and maintaining those relationships.

I can be the best real estate agent in the Lower 48, but it is ultimately my client's perception of my performance that is going to make or break me. And sometimes, no matter how hard you work or how flawlessly you manage and oversee the process, it's just not good enough.

And "perceptions" can run the gamut. The client's house sold for too little or he paid too much. Long market times must mean the agent's marketing fell short, and a canceled escrow -- whatever the real reason -- happened on the agent's watch, so it is the agent who must have failed. This is where it gets personal -- for the client, and for the agent if we let it.

Knucklehead cooperating agents, declining markets, unrealistic buyers and sellers -- we all have to deal with them. But to our clients, the responsibility, if not the authority, is entirely ours.

I have learned in this difficult market to scream out the window early and often in an attempt to establish reasonable expectations and to prepare my clients for all of the obstacles we might encounter. Too often, however, I do this only to watch my clients suffer a big old case of amnesia later.

I suppose the point is this: Not everyone will fully recognize or appreciate our efforts. Our clients' perceptions will not always be accurate nor will they always be fair. Our jobs are difficult, and the most difficult part is arguably in maintaining balance -- in not letting the very personal nature of our work become personal.

Because when we let that happen, we risk losing control -- of both our effectiveness as agents and our mood, morale and overall happiness as people.

Kris  Berg is broker-owner of San Diego Castles Realty. She also writes a  consumer-focused real estate blog, The San Diego Home Blog.