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REO Crack in Basement floor

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Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Doing an REO subject property is a year old. Basement floor now has a ¼ crack running the width of the basement.

I would call this a settlement problem. But how would you handle the cost to cure. I would assume you would need to have the floor removed and the ground re-compacted under the floor. This would cost a great deal. It also indicates to me that there could be settlement problems that could lead to additional cracking in the drywall of the walls of the subject.

Should I call for an inspection and note in the report that the results could alter the value of the subject property a great deal?

Or would you just consider it large crack and move on.
 

stefan olafson

Senior Member
Joined
Apr 2, 2003
Professional Status
Certified General Appraiser
State
North Dakota
I'd call for an inspection and make sure you have a description of the problem and a photograph in your report.

It may or may not be a big deal, but your client should know about it.

Disclose, Disclose....
 

Webbed Feet

Elite Member
Joined
Feb 11, 2005
Professional Status
Certified Residential Appraiser
State
Canada
Mr. Miller,

Is this on slab or on footings? It makes a difference. On slab, big *** problem! On footings I would want to look for additional signs of settling. A quarter inch is getting to a stage of being troubling. You know my posts. Cost to cure only has validity when we know the source and extent of the problem. Such as the cats peed all over the place and now the cats are gone. Repairs can be estimated. But hidden events with unclear causes that only have a symptom we can see?

Appraisers are not magicians. No matter how badly our clients want us to be just to make their lives easy so they can rush all their needs at our expense. I'd call for that third party inspection and employ that EA if I were you. Or tell the client they have to get one for me with contractor estimates of repairs to "base" my work on with a EA those estimates are valid.

Webbed.
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
For you to see this crack running across the "width" of the basement I'll assume that the entire level is unfinished, yes ? I would take plenty of photos from differing directions. I would stick a pen or pencil into the crack and take a close-up photo of that too. Is there vertical displacement along this crack and separation zone ? I would use a bubble level and determine, if possible, the direction of maximal settlement and place an <---- arrow on my sketch page for that.

As for cost-to-cure.......you've got to be kidding, yes ? I'd express the sincere suggestion that your client communicate with a few local concrete and foundation contractors, and secure from them at least two bids that will "cure" the problem to the client's satisfaction. You might offer a few company names and phone numbers from your local yellow pages and save the client some time.

I would CB4 that report without skipping a beat. I'm a bit surprised that you have not met this same dragon before, and handled it in a fashion befitting one with seasoned experience. Good luck.
 

Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
For you to see this crack running across the "width" of the basement I'll assume that the entire level is unfinished, yes ? Yes I would take plenty of photos from differing directions. I would stick a pen or pencil into the crack and take a close-up photo of that too. Did that Is there vertical displacement along this crack and separation zone ? Slight I would use a bubble level and determine, if possible, the direction of maximal settlement and place an <---- arrow on my sketch page for that. Donig that

As for cost-to-cure.......you've got to be kidding, yes ? Yes I'd express the sincere suggestion that your client communicate with a few local concrete and foundation contractors, and secure from them at least two bids that will "cure" the problem to the client's satisfaction. You might offer a few company names and phone numbers from your local yellow pages and save the client some time. Never thought of that

I would CB4 that report without skipping a beat. I'm a bit surprised that you have not met this same dragon before, and handled it in a fashion befitting one with seasoned experience. Good luck.
In older homes where the problem had been cured by a contractor. Never in a home a year old.

The other thing I notice was the sepration of around an 1/8 of an inch from the footings around the entire basement. Also took pictures of this as well.

Then there was the problem of the water line leaking where they pulled the water meter out in the basement. No sump and no floor drain in the basement. Might make a grand swimming pool some day. (unless they set the furance on top of the drain. Could not see one when I look and the flood did not appear to slope that direction. I will also note these in the report.
 

TJSum

Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
The crack in the floor is the drain. :rof:
 

JT1974

Senior Member
Joined
Dec 16, 2006
Professional Status
Certified General Appraiser
State
Wisconsin
Ray,

Considering it is an REO, was the Heat turned off? If the earth under the concrete floor was waterlogged due to a leak and then the ground froze due to lack of heat, the crack could just be the result of a frost heave.

My Concrete guy gave me two guarantees when I built my house.

1. The concrete will get hard
2. The concrete will crack.

However, 1/4 inch is a pretty big crack for new construction. I'm curious as to the heat situation in the house and the possible frost heaving the floor.
 

Ray Miller

Thread Starter
Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Ray,

Considering it is an REO, was the Heat turned off? If the earth under the concrete floor was waterlogged due to a leak and then the ground froze due to lack of heat, the crack could just be the result of a frost heave.

My Concrete guy gave me two guarantees when I built my house.

1. The concrete will get hard
2. The concrete will crack.

However, 1/4 inch is a pretty big crack for new construction. I'm curious as to the heat situation in the house and the possible frost heaving the floor.

Heat still on in house.
 

Greg Bell

Senior Member
Joined
Jul 7, 2006
Professional Status
Gvmt Agency, FNMA, HUD, VA etc.
State
Louisiana
Typical for a HUD..
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
The additional info helps....but now I must repeat myself somewhat. Is this basement completely unfinished ?......as in all-concrete, walls and floor, all things visible ? Are there wall cracks too ? Funny thing about heaving of most rigid (poured concrete) floors is that one area goes up in equal amount to another location that surely goes down. Is there vertical displacement along that 1/4" crack ? Which side actually moved and which (basically) did not ? Not a fair question, I know. They both could have moved. Basement concrete cracks are like rattlesnakes in the desert. O.k., you see one, now where is the second one hiding ? It's common for a second crack to become the equal-and-opposite reaction to off-set the first movement. Just think of the East African Rift System.

How is it that you can see the footings ? Why was the water meter "pulled out" ? Do you mean incoming water delivery line instead ? Isn't the meter outside of the house ? Hmmmm, no sump pit and no floor drain. Uh oh, your client has a definite problem to resolve. That problem is NOT really your's to embrace, but I sure would describe verbally all of the facts, the history and the marketability factors that might be experienced in the future.....if your paper-holding client does not do the right thing with THEIR owned piece of real property.

You report.....let your client decide.
 
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