I purchased a property through Roofstock in June. The Roofstock inspection, which was admittedly cursory, turned up nothing.
In the PSA disclosures, the seller admitted that there were leaks in the house, but that they had made attempts to fix it (I mistook it as "had been fixed").
Since then, the inherited tenant moved out, and a new tenant came and went, complaining of severe plumbing and basement leak issues.
I scoped the main line and found that a pipe in the basement has completely rotted away. An outside portion of the line is impacted by roots, and it is holding water. The estimated cost to fix is about $8.2k ($4.5k to remove and replace the inside line, and the balance to do the outside portion). My understanding is that insurance won't cover the outside. Does the inside count as "neglected maintenance"? Should I ask my insurance agent if they will cover it? I can't tell if even asking them for advice would trigger a premium increase.
The other issue is that water is pooling around the basement windows and other areas. It requires about $7.7k in concrete and dirt removal and replacement to prevent water from entering the house (as well as fixing the windows and drain pipes). Would I be able to invoke insurance for this?
There is a water exclusion in my policy, but the bold part is where I have some hope.
[No coverage for]
Water below the surface of the ground including that which exerts pressure on or flows, seeps or
leaks through sidewalks, driveways, foundations, walls, basement or other floors, or though doors,
windows, or any other opening in such sidewalks, driveways, foundations, walls or floors;
...
Wear and tear; marring; deterioration; inherent vice; latent defect; mechanical breakdown; rust; mold;
wet or dry rot; contamination; smog; smoke from agricultural smudging or industrial operations; settling,
cracking, shrinking, bulging, or expansion of pavements, patios, foundations, walls, floors, roofs or
ceilings; birds, vermin, rodents, insects or domestic animals. If any of these cause water to escape from
plumbing, heating or air-conditioning system or household appliance, the Underwriters cover damage
caused by water. The Underwriters also cover the cost of tearing out and replacing any part of a building
necessary to repair the system or appliance. The Underwriters do not cover damage to the system or
appliance from which this water escaped.
And finally -- I heard thirdhand that one of the technicians who went out to the property to perform repairs had been to the house before, on similar work. And I also heard (again, thirdhand) that the inherited tenant had complained of these issues, and had moved out as a result. I'm following up to get firsthand confirmation. If this is correct, it seems like the previous owner had knowledge of these issues.
My questions are:
1) Should I inquire with my insurance about coverage? What would a standard policy likely cover, among the list above?
2) Should I contact a lawyer to seek relief against the former owner? It seems likely that they had knowledge of these issues and didn't disclose the extent.
I wouldn't have gone through with the purchase if I had seen the leak disclosure before the PSA, but alas. I'm into this house for $15k in various turn costs already, so doubling that (for a property that cost $85k) is pretty horrifying.
Thanks in advance for your advice.
