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Q: I was supposed to move to a new house three days before the storm, but my plans changed. A river of air soaked the hillside of the property’s backyard, and the seller reported that part of the hill had collapsed and slid into our backyard. Mud crashed through the sliding door of the family room. The seller informed the real estate agent that the family room had feet of the earth.
I need to extend the escrow period to sort things out. We want you to resolve all issues before finalizing your home purchase. However, you may alternatively close escrow and have the seller rent back, with the seller agreeing to pay damages. In other words, the seller puts the house and garden back in place before we owned it.
Are the solutions offered by realtors and sellers realistic? Or should this act of nature call into question the prudence in finalizing this purchase?
A: It is commendable that the seller is taking an active role in the restoration. However, you should consult a real estate attorney for proper paperwork, guidelines, warranties, and oversight of plans presented by sellers and realtors. So call your real estate attorney ASAP as you will have to wait in line. Real estate attorneys are extremely busy after earthquakes, floods and landslides. Homebuyers often try to cancel a sale, especially when an act of nature has damaged the property, but we can work together to get your dream home in the condition you expected it to be.
Insurance agents remind us that standard homeowners insurance doesn’t cover “moving earth.” However, mud inside the house is covered by flood insurance. In the past, home flood insurance was probably optional or ignored.
The home seller will most likely repair the damage at their own expense. Let’s not forget, licensed, insured, and insured restoration companies, contractors, and roofers have been flooded with customers ever since the atmospheric river flowed through the Bay Area. These home sellers need more time and money than they think.
If you need a new retaining wall behind your house, it takes a lot of time, engineering, and money.
Here are the steps you need to follow:
1. Learn what work needs to be done to make your property perfect again.
2. What company is working on the property and its qualifications?
3. Learn what building permits and engineering are required and available.
4. Get an estimate of repair costs and completion.
5. Decide if you want to carry the burden of this event in the future.
6. A real estate attorney will ask you about closing a home sale with only a promise that the owning seller will pay for the repairs.
7. At that point, you become the landlord and the seller becomes the tenant.
8. If you decide to proceed, you should disclose this hill slide to your insurance company and prospective home buyers.
Mother Nature started this chain of events. It’s up to you to finish it.
Questions about buying or selling a home? A full-service real estate agent, Pat Kapowich is a Certified Real Estate Brokerage Manager and advocate for consumer protection throughout his career. He is based in his hometown of Sunnyvale, California. Office Landline: 408-245-7700; Broker Number 00979413 Pat@SiliconValleyBroker.com Broker Number 00979413 www.SiliconValleyBroker.com
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