Permits not pulled for Philadelphia property

[Aziz Mansaray]

Hey folks,

I'm so close to settling on my first rental property. I plan on house hacking it and I'm looking at a 20% cash on cash return after all the expenses for this property. The numbers seem to work. The property was built in the 1920s, but was renovated 3-4 years ago. It looks pretty good and home inspection revealed some minor issues that need to be fixed, but nothing too severe. Probably will end up spending maximum 2k for the repairs.

Only issue here is that the the seller never pulled electrical, HVAC, and roof permits for the property. The seller just disclosed this after pulling the city certification and settlement is approaching. Given the results for the home inspection, I'd think that there won't be any major repairs I need to make to get the building up to code, but I don't know how strict the city inspection would be. 

I plan on renting this out for a long time so I'm thinking that it may be best to move forward and take the risk, but I'm not sure. I was at first considering potentially pushing back the settlement date, but in that case I won't have my interest rate locked in and I doubt the seller would agree to this. 

What are my options and how would you guys suggest I proceed?



What are my options and how would you guys suggest I proceed?