"Sold as is - buyer responsible for permits" - please help clarify

[Shea Stringert]

Hey BP MFH investors out there, hoping to get some help on these type of deals. I'm not sure if this is NJ specific or not but hoping your experience can shed some light.

I've seen a number of homes with descriptions that say "Sold As Is - buyer responsible for permits". I realize this is extremely vague but hoping those who have purchased distressed properties or even ones titled like this can lend some insight into what this means. I realize this pertains to permits on construction of parts or the entire home but don't understand how something could be built without all those permits already. Or if they were, how one could even go about getting permits for the work since it wasn't done to code in the first place.

Have any of you come across this or dealt with deals like this?

[Brian Levredge]

Speaking from experience as both a contractor and investor, I have walked into plenty of properties with permit related issues. I've seen listed MFHs that were really nothing more than a house whose garage had been chopped up into additional units and was red tagged by the city. More recently, I helped a buddy who purchased a duplex with permitting issues get out of a bind with the housing authority. Once you buy it, you literally own it, problems and all. Sometimes those problems are so severe there is no easy correction other than demo and starting over. People do all sorts of stuff to their properties that the city has no records of. In fact, it happens much more often than you would think.