Buyer Beware...City Liens/Codes Compliance...

[Andrea M.]

We recently purchased 2 properties right next door to each other with the plans of working on one at a time..2 weeks into the rehab on the first property Codes/Compliance shows up and says that the properties are on the city "watch list to be demolished" , she explains to me that City have been chasing the owner for the last year and the property changed hands 3 times in last year and she came to my house and spoke with a young lady about what needs to be done in order to bring the property up to code.- clearly she was at the previous owner as I closed on the property 2 weeks prior. I explained to her we recently closed on both properties and was not aware of any Code issues.
Luckily for me I had spoken with this particular inspector 3 weeks prior regarding a tenant complaint (tenant made a complaint to Codes without notifying me first) to Codes/Compliance and I rectified the situation within a timely manner. So she felt as though as the new owners we would comply with the city and bringing the property up to code.
She then goes on to tell me to stop working on the inside and start working on the outside, since that is the problem that the city has with the property and since I am the new owner she will give me 30 days to complete the outside, which we planned to do that weekend anyway.
3 days after her visit, the new siding was installed, outside painted and I emailed her and left her a voicemail notifying her of such, she stopped by and inspected the outside and in turn was able to notify her supervisor who in turn removed the property from the "Watch List-Intent to Demolish"

My advice when purchasing reo/foreclosed or abandoned properties-perform your due diligence.. typically if the city has issues with the property or violations, it will not show up on a title report. A quick search on your localities website or a phone call or email to Codes/Compliance can verify any code issues. Had this issue been prolonged it would of been a nightmare to have the city remove these properties from "Watch List-Intent to Demolish" including court cost, setting a bond and numerous other issues..glad we dodged that bullet

[Account Closed]

Originally posted by Ned Carey:

Sounds to me like the title company didn't do their job.

Glad it worked out for you and your suggestion of due diligence is well taken. However if it hadn't worked out I would be all over both the title company and the previous owner.

Ned Carey I'd say most properties I've bought have code compliance issues. And I'd say over half of those had no recorded docs for title company to include in a title report. The simplest citation process includes notifying owners, giving the owner time to complete the repairs, and then a re-inspection. None of that is recorded or public info and that process is way longer than the average escrow. At least 90 days will pass before the city or county generates a recordable lien. It only becomes a recorded assessment if the muni does the repairs and/or the owner doesn't pay the admin. fees.

Since many properties I buy have the an incorrect tax mailing address, that means the owners or heirs are not getting any notices.

If I have any suspicion of a possible citation, I'll call the muni before close. But that's not something title does. Does title research/check unrecorded docs in your area?