Real Estate Q&A
I recently, in July, purchased a house that was a foreclosure. I had a home inspection and it uncovered a few problems which I was prepared to fix after I moved in, because the home was sold “as is.” Unfortunately, the inspector failed to find a leak behind the wall of the shower which has caused mold in the crawl space. This is a cost, which I have two bids of over $3,000, which I was not prepared to absorb and I feel like the inspector should be responsible. What recourse, if any, do I have? I am 67 years old live on a fixed income and can not do any of these repairs myself. Thanks.
— Carol, Grand Junction
I am sick about the circumstances you are encountering as you move into your new home. It sounds like you proceeded with the purchase of your new home responsibly by having a professional inspection, only to be blind-sided by an unexpected repair. Purchasing a foreclosed home does come with risk and it is a common buyer assumption that the home inspector would find all the issues, or at least the major issues, associated with the home. Unfortunately home inspectors do miss minor and major issues from time to time. It is not because they want to miss them or are negligent — they are human.
A lack of house history is significant disadvantage when purchasing a bank-owned property. In the case of a foreclosed home, there is no Seller’s Property Disclosure and thus there is no history on the home. This is like your doctor looking for the cause of a fever and not knowing that you just returned from Honduras and were bitten by a spider the day before you came home. The chances of him finding the root cause of your fever on the first visit are very slim, but become much greater if he is aware of your recent trip and run-in with the spider.
With no home history you must expect some things will be missed, especially when these things were not visible to the naked eye. It is certainly a realistic, if not a minimum, expectation that if there were visible moisture in the crawl space then that would have been red flagged. There is no way to now prove how long the water leak was there, because most of the foreclosed homes have the water turned off prior to list and contract, then turn the water on for the inspection and then turn it off again till close. If that was the case, then it is very possible that the leak was present at the time of the inspection, but was not apparent because the water had not been on long enough for the leak to present as a problem.
The bottom line: I would contact the home inspector and discuss it with him/her and see if you can work something out. Typically they are wonderful people and are quick to help if they can. If you re-read your contract, I will bet you will find language to the effect of “the maximum liability is the sum cost of the inspection”, which means that whatever you paid for the inspection, that is the maximum amount you can recover for any missed problems. Again, consult your attorney and have them review the contract, but unfortunately I suspect there is little recourse you have back on the inspector. I am sorry about your circumstances.
The Kimbrough Team,
RE/MAX 4000, Inc