No Certificate of Occupancy

[norapp]

I appraised a contemporary style log home built in 2006 in a secondary vacation locale near a large lake. It was an FHA foreclosure sale by Wells Fargo. Sale price was incredibly low. I called the agent thinking there must be something very wrong. She replied Wells would rather help out the tenants buying the house than have it sit empty. Never heard that before. Went out and found a home that had a few issues but still sale price was super low. This town does not have a zoning map online so had to call zoning office. First I emailed the office and did not get a reply. No surprise since these rural town in the Adirondacks have limited hours and it was 12/20. On Monday 12/23 I called not expecting to get an answer but the codes enforcement officer picked up. He gave me the zoning information and then tells the property has no CO. I replied there is a home there, built in 2006. He said he knows. The previous owner originally applied for a permit but never followed through as the home was being constructed despite numerous warning letters from the town. He finished the home and lived there for years before he rented it out and it went to foreclosure. The codes officer said the town has deemed this an unsafe structure. He said he notified the realtor and wrote numerous letters to Wells Fargo and had tried to reach someone on the phone to no avail. I was stunned. As I talked to this guy I realized the bank and the realtor both knew there was no CO. It appears they were trying to unload this property on the tenants and wash their hands of it. I also realized this guy just saved me from a potential lawsuit. I do not pull CO's for homes. I assume this is the banks job. I have to say this is one that taught me a valuable lesson. I have an addendum referencing all the things I assume and am not responsible for. But that will not save me from having to defend myself in a lawsuit. Merry Christmas to me. That codes officer saved my neck. Needless to say I wrote lengthy explanation in bold caps on exactly what he told me in the report.

 

[alebrewer]

I appraised a contemporary style log home built in 2006 in a secondary vacation locale near a large lake. It was an FHA foreclosure sale by Wells Fargo. Sale price was incredibly low. I called the agent thinking there must be something very wrong. She replied Wells would rather help out the tenants buying the house than have it sit empty. Never heard that before. Went out and found a home that had a few issues but still sale price was super low. This town does not have a zoning map online so had to call zoning office. First I emailed the office and did not get a reply. No surprise since these rural town in the Adirondacks have limited hours and it was 12/20. On Monday 12/23 I called not expecting to get an answer but the codes enforcement officer picked up. He gave me the zoning information and then tells the property has no CO. I replied there is a home there, built in 2006. He said he knows. The previous owner originally applied for a permit but never followed through as the home was being constructed despite numerous warning letters from the town. He finished the home and lived there for years before he rented it out and it went to foreclosure. The codes officer said the town has deemed this an unsafe structure. He said he notified the realtor and wrote numerous letters to Wells Fargo and had tried to reach someone on the phone to no avail. I was stunned. As I talked to this guy I realized the bank and the realtor both knew there was no CO. It appears they were trying to unload this property on the tenants and wash their hands of it. I also realized this guy just saved me from a potential lawsuit. I do not pull CO's for homes. I assume this is the banks job. I have to say this is one that taught me a valuable lesson. I have an addendum referencing all the things I assume and am not responsible for. But that will not save me from having to defend myself in a lawsuit. Merry Christmas to me. That codes officer saved my neck. Needless to say I wrote lengthy explanation in bold caps on exactly what he told me in the repot.

VERY scary story! So will you now start requiring CO's? Or maybe just in situations where the sales price looks artificially low? Similar story about a friend who appraised the model home in a newer s/d. Garage had not been re-converted back, and home was sold with garage finished out as office. He appraised it as such, only to find himself in a lawsuit a few months later because the CC&R's required cars to be 'put away' at night, thus forcing reconversion back to garage...

 

[norapp]

VERY scary story! So will you now start requiring CO's? Or maybe just in situations where the sales price looks artificially low? Similar story about a friend who appraised the model home in a newer s/d. Garage had not been re-converted back, and home was sold with garage finished out as office. He appraised it as such, only to find himself in a lawsuit a few months later because the CC&R's required cars to be 'put away' at night, thus forcing reconversion back to garage...

Getting CO's from towns involves a lot of time and effort. I think I am going to add a paragraph on page 3 about proper CO's. The other addendum is lengthy and I am sure no one reads it so I will highlight this comment so it really sticks out.

 

[glenn walker]

In our area the utility companies will not turn on permanent electric , water or gas until property is completed and finalized by the city or county. Whats weird in the OP case is usually most cities-counties will red-tag a property that is occupied when not completed or damaged and cut there utilities off and place a lien on the title with fees. Anyway maybe they did and if appraiser can get a copy of title report it may already be on it. Where the new buyers issues could begin is when he/she goes to turn on utilities in his her name and another issue is if fire and liability insurance carrier finds out they will cancel the policy so its good the OP found this out and disclosed it .

 

[Mike Kennedy]

VERY scary story! So will you now start requiring CO's? Or maybe just in situations where the sales price looks artificially low? Similar story about a friend who appraised the model home in a newer s/d. Garage had not been re-converted back, and home was sold with garage finished out as office. He appraised it as such, only to find himself in a lawsuit a few months later because the CC&R's required cars to be 'put away' at night, thus forcing reconversion back to garage...

State of Texas

Start here, then refer to individual State, County, Town, City, Village codes as applicable.

R101.2 Scope

The provisions of the International Residential Code for One- and Two-family Dwellings shall apply to the construction, alteration, movement, enlargement, replacement, repair, equipment, use and occupancy, location, removal and demolition of detached one- and two-family dwellings and townhouses not more than three stories above grade plane in height with a separate means of egress and their accessory structures not more than three stories above grade plane in height.

Chapter 1 Scope and Administration: Texas IHB Residential Code 2015 | UpCodes

UpCodes offers a consolidated resource of construction and building code grouped by jurisdiction

up.codes

 

[Vermonter]

Interesting he stated the home was "unsafe" but you didn't catch anything. Did he elaborate? Could it be an overreaction?

Run into this in rural areas where code enforcement is newly adopted. Building/zoning departments tend to be overly cautious to start and then eventually figure things out. COs are only issued in about half of my coverage area. Some towns have COs, but no enforcement agent. So you just tell them it's done and pay a fee.

 

[Econobot]

I would ask their opinion in writing as you need to determine if subject can be rebuilt if destroyed. It seems the governing body is inviting a lawsuit by there stance on structural deficiencies. The fact they have their opinion but allow occupancy is a problem but it's not yours. I would do a subject to inspection and report legal nonconforming with statements from governing body hopefully on letterhead, attached in the report. You observed and reported, a further inspection by qualified persons can solve the rest. Whoever owns the property might have the buearacrats in hot water if they find no deficiency. If they do in fact find a deficiency at least they now know what it is and can proceed in some form or fashion. Again, I think it's good to observe and report so the owner can rectify a vacant foreclosure property. Hang in there, don't dump it just yet, you can help ensure public trust by your scope of work. Order up a structural inspection and look for obvious movement in the foundation and walls when you go there. More importantly get everything you can from the governing body and include in report.

 

[Restrain]

The thing about Texas is it didn’t even require remits for homes outside the incorporated towns and cities until sometime in the early 2000’s, let alone CO’s. I imagine there are other jurisdictions that are similar. A disclaimer may well be the best way to go.

State of Texas

Start here, then refer to individual State, County, Town, City, Village codes as applicable.

R101.2 Scope

The provisions of the International Residential Code for One- and Two-family Dwellings shall apply to the construction, alteration, movement, enlargement, replacement, repair, equipment, use and occupancy, location, removal and demolition of detached one- and two-family dwellings and townhouses not more than three stories above grade plane in height with a separate means of egress and their accessory structures not more than three stories above grade plane in height.

Chapter 1 Scope and Administration: Texas IHB Residential Code 2015 | UpCodes

UpCodes offers a consolidated resource of construction and building code grouped by jurisdiction

up.codes

The

 

[Mike Kennedy]

The thing about Texas is it didn’t even require remits for homes outside the incorporated towns and cities until sometime in the early 2000’s, let alone CO’s. I imagine there are other jurisdictions that are similar. A disclaimer may well be the best way to go.

The

20 years do tend to fly by.

 

[norapp]

Interesting he stated the home was "unsafe" but you didn't catch anything. Did he elaborate? Could it be an overreaction?

Run into this in rural areas where code enforcement is newly adopted. Building/zoning departments tend to be overly cautious to start and then eventually figure things out. COs are only issued in about half of my coverage area. Some towns have COs, but no enforcement agent. So you just tell them it's done and pay a fee.

It was designated unsafe because there was no CO. He said if a licensed engineer or architect did an inspection with him present and it passed a CO would be issued. He also said they are not in the business of putting people out of there homes and he was aware there was a woman with 4 children living there. This is a rural area in the northern mountains. How they do business may be unusual but that's what he told me. I did catch some things but none were major. Like I stated in my original post it was a fluke I got the code enforcement officer on the phone and after he gave me the zoning info he then we had a long conversation where he described his efforts to reach the lender.