What's the right thing to do in this situation?

In My Humble Opinion
1

Hi all… I could really use some opinions on what the ethical choice is in this particular situation involving a house I currently have a contract bid on. Here’s what happened:

When my realtor took me through this house, I fell in love with it and its location :slight_smile: However, the floor in the back addition felt
like a big sponge. Seriously. And the aboveground
pool, well, you don’t want to know. It literally looked like where you’d expect to find the bodies hidden. So I called Metro
Codes (county govt. office,) and asked if I could get
copies of all the building permits ever issued for
that house (permits have been necessary for almost any
kind of project since about 1959.) I could. So I went
down to the Codes office and spent the whole afternoon
there. THAT was educational!!!

It turns out that the lovely owners never filed
permits for ANY of the additions that were built on
the house. That means that they almost certainly used
unlicensed contractors. (The brother-in-law with the
pickup truck kind of thing.) In 1992, Metro Codes
cited them because the building inspector found this
out. They were ordered to make repairs, never did, and
got a summons and a court date. (!~) After that, the
trail goes cold. I found and talked to the building
inspector who signed the report (he’s still there.) I
talked to building inspectors all day, in fact, which
I must say I like to do. :slight_smile: I made friends, had a
great time… well, anyway. I called Davidson County Circuit Courts Environmental Records Division and found out that as far as they knew, the case never actually was closed. Most likely, it just “slipped through the cracks.” I asked if that meant it could potentially even be reopened someday, and they said “yes.”

THEN, I realized what all of this meant. If someone
bought the house and then found out later about all
the problems, the owner would be the only one to go
after legally. And that’s because her husband was
cited in 1992 (and her name was on the deed to the
house then, so she would have legal responsiblity
too.) So there’s official, written proof in Metro
Codes records that she knew then, and yet I have a
copy of the seller’s report from 2006 that she was
“unaware” of anything. She now claims she didn’t know and that her husband was responsible for it all; I’m pretty sure that makes no legal difference, since they weren’t divorced and she was on the deed at the time.

So from now on, the owner’s knowledge of these conditions is legally required to be on the seller’s disclosure, since there’s proof that the
owner DOES know. That means that I truly think NOBODY would ever
make on offer on this house except a developer. Based on what the home inspector said, the costs of fixing all the structural problems would be just within my budget, although there are also quite a few things that might need to be replaced at any time or could hang on for years; nobody knows which (HVAC, water heater, etc. And yes, the floor in the addition and deck is DANGEROUS.) Because of all of this, I worked out a very careful budget, and I can’t go above $50,000 as a price for this house. I just can’t. There’s no way in the world that’s fair. There’s just too much that has to be done to it, and too much that might very well have to be done in the very near future. A developer would offer much, much less.

But I’m also so disgusted by this whole thing that part of me just wants to have nothing more to do with it. If I don’t make an ethical choice in this situation, I can honestly say that I want NOTHING to do with it and I’d rather live in a nice cardboard box under the bridge. But what are really the ethics of this situation? Yes, the owner originally started out a year ago by asking about $120,000 for this house, and she is a 65-year-old insulin-dependent diabetic who claims she never knew anything about any code violations. OTOH, I just simply don’t quite believe that. I’m sorry. I don’t. Even if her husband had more responsibility for what happened, I do think that she had SOME. At the absolute least, the back deck and pool are actually public safety hazards right now, since they’re not fenced off, and there are a zillion kids in the neighborhood. I’m amazed nothing terrible has happened yet.

Should she have done something about this? Legally, she should have known, but morally, should she have known? Is it really her fault that she didn’t know? Of course, I do think that we are all responsible for our behavior and our choices. I have 15% permanent disability, I also have visual disabilities and a head injury, I had 2 years of physical therapy in order to relearn how to walk, and really, any number of awful things have happened to me. Does that mean that I get to use it all as an excuse for everything? And yet I could not live with myself if I thought I was taking advantage of this owner, no matter how she’s behaved.

I just don’t know how to feel about this, but more than anything, I want to do the right thing. If I didn’t, I would be offering what a developer would pay for this house. Based on similar houses in a very nearby and comparable neighborhood that some developers bought this year, I truly think I could offer more like $35,000. Yep. Really. But I don’t know if I can do this. If I pull out, am I justified in pushing Codes to reopen this case, or at least making a phone call at the point where I stopped? Children who got onto this property the way it is now could be injured or even killed. Ick, I just feel so… well… icky about this whole thing. ALL advice and opinions welcomed!!!

2

Wait. So you have a contract for $50K for the house? Or not? Have you made an offer yet?

I think you need to let go of all of these moral dilemmas. You’re buying a house (maybe). You aren’t responsible for this woman’s morality or being “fair” to her. You buy the house if you want it and it makes financial sense. It has nothing to do with her diabetes or the morality of having an unfenced pool. Let all of that go. At what price does it make financial sense to buy this property? That’s it. You don’t even know this woman.

3

I think you alerted them, anyway. There is a high probablity that they knew about it already.

I’m with Renee. Walk away. Wait … no … RUN away. Don’t get caught up in this mess.

4

Good faith is something that expected from both sides, and you’ve got good reason to believe that the woman you’re dealing with isn’t showing good faith, IMNSHO that means you’ve got no reason to maintain your own “good faith.”

Run away, now.

5

If the woman is 65 or 55 or 25 it doesn’t matter, she’s lying. Walk away from the house. You’ll find another one.

6

The only reason to continue with the deal is if you can amend your offer based upon the cost of rectifying the known problems, and you really want this house. Otherwise, there was a failure to properly disclose issues which the seller would reasonably have been aware of. One of my axioms when doing home inspections is that the crappy work you see is typically the tip of the iceberg. :wink: Good luck

7

I don’t get the timing.

Did you put in a bid of $120,000 and then you started worrying about the problems. So, you looked into them, and now want to revise your bid?

That’s a legal question.

Ethically. . .you are WAY over thinking this. You’re not ethically bound to offer anything to anyone. You can offer the old lady $1 for the house. If she agrees to it, you did nothing wrong.

8

Quit trying to borrow someone else’s problems.

You know it would be incredibly stupid financially to buy this house. This is not your home. Your home is still out there, waiting for you to find it. Quit with the empathy for this poor diabetic invalid woman. Why should you pay for someone else’s bad choices?

Walk away. This is not your home.

9

Like I said in your other thread, you’re over thinking this. You’re under absolutely no moral obligation to offer more than what the house is worth. It’s not cheating her or taking advantage of her. If $35,000 is what the market says that the house is worth with all of its problems, and you really like it, then offer it.

Or if it’s really going to bother you, walk away and find a different place.

Either way, don’t pay more. How about this - I have a nice house and in my neighborhood its worth about $280,000. You know, I think that I want a million for it, though. I’m free to list it at that, but somehow I don’t think that you’ll feel bad about only offering me the $280K. :smiley:

10

There’s your answer.

What I read from the rest of your post is that you have some sort of guilt about not buying the old lady’s house. You seem to think that you have an ethical obligation to help this woman. You don’t. She may be in a difficult situation and have a house she cannot sell. You are not her white knight. You do not have to help her and you would be a fool to buy her house in order to help her. I have made many terrible decisions in my life when I was more worried about the welfare of others than my own welfare.

11

With regards to the deal. If you can walk, do so. Chances are there is more wrong with this house than you know. If they cut this many corners on an addition, they cut corners on other shit as well and you don’t need the headaches.

Look, you didn’t create this situation and you have no obligation to assume it. The owner must have known what was going on. No one could be that oblivious. In a previous thread, didn’t you mention that several sales of the house had fallen through?

If you’ve brought it to the attention of the building inspectors then you have done enough.

12

Walk away. Whatever you’ve budgeted to fix this house is only about 1/3 of what you’ll actually need to put into it. You’ve only budgeted for what you currently know is wrong - there’ll be many, many more problems that you’d discover as you go.

Talk to your real estate agent and explain the situation. Your agent should be able help you with whatever needs to be done to get out of the contract. If you really, really feel the need to save other buyers, ask to meet with the seller and both agents. At that meeting, explain what you’ve found. Give them a written list. That will obligate not only the seller but her real estate agent to disclose properly to potential buyers, and her agent will know that your agent is aware of this.

I’d suspect the Codes office will be looking into the case again, anyway. You can call them and file a complaint if it makes you feel better, after that it’s up to them.

If you just can’t live without this house, go watch The Money Pit first. If you still want it, offer her maybe $30,000 or less. She’s under no obligation to accept your offer if she doesn’t feel it’s enough. She can counter-offer if she wants. The house is only worth what it’s worth - it’s not worth more because the owner has a sob story. We’ve all got sob stories.

The seller obviously knows there are problems with the house or it would have sold by now. If she wants to sell it, she’ll have to drop the price to what it’s worth. If she doesn’t want to do that, then she doesn’t want to sell it.

13

So…

are you bidding on the house? :wink:

and if you buy it, don’t you become responsible fo the deficiencies?

14

If I’m reading the OP right, (which I’m not sure. $50,000 - for a house? really? is there a “0” missing there?) the ethical dilemma isn’t whether or not to buy the house,

it’s whether or not to call the city planning, zoning, permit departments, etc. and tell them that this place is against code, a hazard, and a child-drowning waiting to happen - and that the owner knows it. If Anise does so - whether or not he buys the house - it’s going to be a lot of trouble for the seller (will have to fix things or drastically reduce the asking price, will get fined). If not, then when the next potential buyer might not be so thorough as Anise was, and will get screwed when the woman lies about how much work the place actually needs.

I say make the call.

15

It’s plausible, depending on the area. My sister paid 18,000 dollars for her 100-year-old, two-story, 2 bedroom/2 bathroom house around four years ago. It’s was a bit of a fixer upper, but definitely not a dump. But, she lives in a really small town in Iowa. In this same town, a gorgeous five-bedroom, newly remodeled, freaking beautiful, beyond my wildest dreams house went for less than 200,000 dollars.

16

Thanks all! :slight_smile: Yep, I don’t really see this house getting up to where it needs to be for less than $30,000, quite honestly. I met with a contractor today, and he’s going to do a detailed bid, but when all is said and done, that’s what we’d be really looking at. The thing is, $30,000 would include both overages and replacing anything that I even THINK might need to be replaced (HVAC, water heater, etc.) as well as a couple of things that I don’t want to live with (awful sink in the main bathroom, etc.) My last figure didn’t include those things. I do think that that would really cover it, though. However, that doesn’t include all of the labor on the cosmetic stuff and also the landscaping, since I would do both anyway. I’m not sure what I would do about the ugly kitchen cabinets, but I would do it on my own, since that would be kinda fun. :slight_smile:

I don’t know who’s really at fault when it comes to that owner and all the code violations, and I don’t NEED to be the judge. I did realize as a result of all of this that I can’t think that way. I’m going to devote my life to gerontological social work, and you know, at some point that just has to be enough. :wink: If I hadn’t come along, the truth about this house would not have changed. If someone had bought it without knowing everything that was wrong with it, either THEY would have then had to suffer with it OR they would have ended up suing the former owner, and then everything I found out would have come out anyway. I don’t really know why apparently nobody ever DID find out what I did. It was all public records!!

Anyway, I need to meet with the other contractor tomorrow and see what he says. Then, I need to do two things. First, I’ll talk to my financial advisor again, and find out what he thinks the breakpoint price is where it would be worth it for me to get into this situation, knowing that the resale value of the house if upgraded this way would be at least $110-120,000 even in the next couple of years. Quite honestly, based on prices paid by developers a couple of months ago for very similar houses (which I went and saw today) in basically the same exact neighborhood, this house is really and honestly worth no more than $45 or 50,000. It just isn’t. Nashville is just odd in this way. There are still some extremely cute neighborhoods that are remarkably cheap (although houses in this one would go for more like $100-110,000 if they’re in good shape), and they’re very very close to wildly overvalued yuppie neighborhoods (the house is in West Park and the yuppie neighborhood a few blocks away is Sylvan Park, for those familiar with Nashville.) THEN, if I still want to go ahead with it all, I need to get the house appraised. That’s what I really would need to know: what’s the true as-is value of the house? What’s the most this owner could expect to get?

Then, I need to keep working on those co-dependency issues. :wink: And then I’ll decide!