Yesterday, my client's lender asked about a laundry room located at the back of the garage. The selling agent had said the room was permitted. I asked for documentation; he said they had none.
This morning I went to the Pasadena Permit Center. They have no record of permitting the laundry room. Oops. The lender will not fund until the room has been "gutted". Meaning, the washer and dryer need to be removed, the gas capped and the electrical removed.
Here we are at the last week of escrow. Now an obstacle has been presented. There are several course of actions. We are investigating.
What did we learn here? If you are buying; be prepared for anything. It's difficult, but keep your feet on the ground. Buying is an emotional journey, especially for the unfamiliar. You may have to walk away from a house. Or you may have to make a concession to keep it.
We judge our purchase of a home using several variables. Location, condition, price and inventory are primary. Also include the economic condition of the marketplace. Will prices rise, fall or be stagnant? What about funding. Interest rates affect those who borrow more.
For the seller; make sure you know your home. Disclosures need to be certain. In this case where the laundry room is not permitted. The seller has already invested 100 days on the market; not including the time preparing for market (which I understood as nine months). Now we have an obstacle. The seller may choose to back out of the deal, by not agreeing to an amendment document (called Request for Repair). The buyer will not be able to fund; thus canceling the deal.
Will the buyer be able to find a cash buyer? Will the buyer be able to find someone with a lender to overlook the non-permitted room? Will the buyer just give up and stay for whatever reason?
The fact remains, the buyer has invested a great deal of time. Time is money (about $50/hour). Not including the cash investment.
Don't do this to yourself. Make sure your house is in order. Make sure the asking price is competitive. We use the same variables to value our home as we do to buy our home.
Call me we'll talk.
