Making A Seller Disclosure Case

Q: Five months ago we bought a house from a "good" friend. We bought it as is and didn’t get an inspection because it was not required although we did have the property appraised.
 

Needless to say, the property has been a nightmare ever since. Shortly after we moved in everyone started getting sick with everything from minor allergic reactions to pneumonia.

Our pediatrician suggested we remove the carpets. Our home is raised and we were told it would need to be leveled before we replaced the flooring. We then found out that there is water pooling under the house that has resulted in severe mold growth.

In the process of getting rid of the mold, we found out that the foundation is severely damaged and there is moisture in all of our walls. The list goes on and on.

Are the sellers liable for anything?

A: Let’s review the situation: You bought this house from a friend. You didn't have an inspection. You bought it in "as is" condition.

Is it possible that your friends didn't know about the mold? Is it possible that they weren't as sensitive to it and never got sick? Or the problems got worse once you moved into the house? Or, if they got sick, is it possible they never put two and two together to figure out that there was a problem? Is it possible that their pediatrician isn’t as smart as yours?

As long as the sellers fulfilled their state-imposed obligations to disclose every known material problem the house that isn't visible to the naked eye, I wonder how much liability they'd have.

Typically, in a seller disclosure case, you'd have to prove that the sellers knew, or should have known, about the problem. But if they met their statutory obligation to "disclose" what they knew, signed off and you accepted that, and if you can't prove that they knew or should have known more, I'd say you have a tough road ahead to prove liability.

A real estate attorney or litigator can advise you further as to your legal options (if any) and remedies.

Let’s talk about where you are today: The real question is what can you do now to salvage your property? If you have to level the floor, then perhaps you need to dig out a basement, and replace the underside of the house in order to get it to dry out and kill the mold.

How much this will cost, and what this will do to the value of the property are issues you should consider.

If older homes in your area have been town down and replaced by larger, more opulent dwellings, and if you can afford it, you might want to think about tearing down this house and building something from scratch that would be more in line with what is the new norm in the neighborhood. If you can’t afford this solution, but the land value in your area approximates the value of what you paid for the home, you may be better off selling that putting more money into the home.

While this would be an expensive move, long-term it may add a significant amount of value to the property.

You’ll need to sit down with a good contractor to determine how much work will actually need to be made to the home and what your options are in terms of making necessary repairs to the home.

If you can't afford to tear the home down or even make the repairs, and don't have a good seller disclosure case against your friends, you may be out of luck.

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