I'm the Victim of Real Estate Fraud in Philly

[Atisha Fordyce]

I was blind-sided with the news that my recently bought two-family home is legally a SINGLE FAMILY dwelling. 

I closed on the home in November of last year. It appraised for $300,000. I live in one unit and rent out the other short-term on airbnb. 

I now have to obtain a Limited Lodging License in order to continue renting on airbnb. I went through the process in order to do so and was blind-sided at the L&I office with the news that the property I bought is not actually a multi-family home, but a single family home. 

The seller applied for RM1 classification but never obtained any permits to do the work of flipping the home from single-family to multi-family. All of the work that the seller did to the property was done ILLEGALLY, without any approval or permits. I went through the process of purchasing this home; having extensive credit checks done on me, paying for home inspections, paying for appraisals and expecting the utmost due diligence from my lenders, the appraiser they hired, my title company and realtor. 

Now, I am here today with the information that there was fraud somewhere along the line and I now can not LEGALLY rent out my home for the purpose it was purchased. 

I am kindly asking for your advice on what steps I need to take moving forward. I am in need of an attorney who will be able to fight on my behalf. I need answers and I need solutions. 

Community, thank you so much for your help.

-Atisha

[Eric Greenberg]

Is there any documentation stating that the property is RM-1 and not RSA-5?  Or did your buying team just not mention that it may not be a legal duplex? From my experience the city doesn’t change the zoning but rather gives a variance to use that property in a different way than intended. 

I would guess over half of the properties I see do not have the correct zoning for what they are used for and/or remodels without permits. I’m not sure what legal action you had for the seller unless it was written down that it was RM-1 or had a variance for a duplex but either of those are easily searched for using Atlas. The next option is to hire a lawyer and try to get a variance which can be expensive, uncertain, and take months for an answer. Happy to answer any questions or point you in the right direction.