Permits not pulled. Philadelphia area.

[Igor Messano]

Hi BP people.

I am a new real estate investor with only 2 deals under my belt. I am looking to get my first rental property and am excited at the opportunity to start building some long-term investments. I have the opportunity to purchase a renovated 2 bed 2 bath home in Philadelphia for about $70,000. The property is worth somewhere around $90,000 right now, and properties 1-2 blocks away are starting to sell in the $250,000 range. All of the numbers work very well as far as cash flow is concerned.

The issue here is that part of the renovation includes a small addition to the home which has increased the size of the kitchen and one of the bedrooms. All of the work was done by skilled laborers but no permits where pulled. The know the current owner and was around when he was renovating and know the people who did all of the work. The entire house is new as far as plumbing and electric.

What would my options be here in terms of the lack of permits. Does Philadelphia provide any options besides tearing everything out and have it inspected and redone? 

I would be looking to financing the home or first having the title transferred and then re-financing the home to cash out.

[Noman Tariq]

it doesn't sound right why would owner sell for 70k knowing the area is 250k.. That's a huge difference