A Sellers Bad Cover up

[Peter Mckernan]

Hello everyone,

So, I just recently bought a new rental property and this property has two dwellings on the property. The front is a three bed/one bath and the back is a one bed/one bath that is attached to the garage. At the time of purchase and inspection there was a tenant that was leaving in the back portion and has recently moved out, and once she moved out I noticed that there was mold on the drywall in two different areas of the studio. So, I quickly went to my insurance and also had a PM that deals with mold restoration come out to assess the situation, and they both advised me that the mold/damage was old and also showed me that it had obvious signs of pervious fixes with no success.

I am making assumption that this sometimes happens and there is a way to go about the process of recouping the money from the sellers, but I am not sure how to go about it since this is my first time dealing with this type of situation. So far I contacted my real estate agent about the issue and today she will be getting in contact with the seller's real estate agent to let her know what is going on. I have the inspection report that shows some areas that indicated moister and it was covered up by paint, but this wasn't even the worst spots. How hard will be to get money from the sellers and will I ultimately need to get a lawyer involved?

Thanks in advance,

Peter

[J Scott]

I'm not an attorney, but I'd say that -- unless you want to spend significant time/money on pursuing this -- it's unlikely you'll recoup anything from the seller. There are a couple facts that will likely hinder you:

1. This was a rental property for the seller. That means he will likely have plausible deniability for the damage, as he can just claim that his contractors did the make-ready and never informed him of any mold/moisture issues. While this may or may not be the case, the burden of proof will likely be on you, and unless you can find any of his contractors (or previous tenants) to contradict that story, a judge could very well believe him;

2. Your inspector missed the issue. It would be very easy for the seller to say that because an inspector missed the issue, it's reasonable that he wouldn't have caught the issue either. Had the issue been obvious (or had it been covered up in a costly or complex way), you could argue that the seller might have known about it, but given that it was just painted over and your inspector didn't catch it, the seller can easily argue that he shouldn't have caught it either.

Unfortunately, this is just a case of "buyer beware" and without any proof that the seller intentionally deceived you, my guess is that you won't be able to easily get anything out of him.