Water damage before closing - Buyer needs guidance

[Mithun Bondugula]

Hi,

I have learnt that the house I am about close has got flooded. The owner does not live there any more so they did not realize for two days. They have engaged a water damage restoration company - seems to be good company that has been providing regular updates. They have also filed an insurance claim. They are hoping that insurance will pay to get the house to original state.

I have few questions:

1) Will there be any longterm damage? or does the restoration pretty much bring it to normal state?
2) Does the value of the house go down? that is, when I sell it future, I assume I have to declare this incident, so will the appraisal be lower because of the incident?
3) The initial agreement, appraisal, loan and even closing disclosure from Bank are out. Do I have any room for ask for compensation?

Thanks,
Mithun

[Kevin Dougherty]

All depends on what caused the flooding, was it a broken pipe vs. heavy rains that allowed water in via the roof or through the foundation. The broken pipe can be fixed quickly but the roof and foundations require extensive labor and cost. As to long term damage, did the water warp ceilings, walls and/or flooring? Did the water effect the electrical system, HVAC, hot water system or any other appliances? Make sure everything was dried properly so no chance of MOLD occurring. Best to have your own contractor review the damages to guide you through this. Your real estate agent or attorney can advise you any compensation that may be due.

Good Luck