Warranties, inspections and the "new" home -- $997k now offered $183k

Story about a "money pit" in NJ. A new home. The buyers thought that they would skip the home inpsection because it was new and rely on the local building inspectors. Big mistake: building inspectors do NOT do detailed inspections. They spot check more often than not and they rely more on the contractor's fear that having something not pass. This home had over 13 code violations not caught (including missing support columns), mold issues and other issues. The builder was defunct. They turned to that home warranty policy that they got as a sales tool (ahh, the "comfort" of knowing that if the builder won't fix it, you have an "insurance policy"). The warranty company figured out the home repairs would cost over a $1 million, so they offered $183,000. Now assume some of that is a reflection of the drop in real estate values in the area but does not seem right yet. The homeowners have sued. http://tinyurl.com/84z3ots
Lesson: New or old home: Get a good inspector. A warranty is good but it may be little comfort when needed.
  4 answers
  • KMS Woodworks KMS Woodworks on Mar 15, 2012
    I just read through that article...the suit should focus on the builder and the city...If the architect submitted plans and drawings that Meet code...then they are in the clear. Its not that hard to verify a set of plans with what is in the field when it comes to support columns...that is why there is a "framing" inspection phase. This is checked off before all of the walls are covered up.

  • I agree Kevin. Overall it would be difficult for a home inspector to determine in a new home inspection if support columns buried in walls as actually present. You have to look for indications. I did have a case here in GA where the kitchen floor was sinking. The builder's engineer came out and blamed it on the weight of the frig and they did some "cross ties" in the basement to "fix" the problem but the floor still sunk, so much so that a pencil would roll across the floor. Overtime this was going to become much more serious. The original plans for the home were eventually obtained from the builder (not an easy task) and walking through the basement it was discovered that the framing for an entire support wall was missing. So you ask, why was this missed during the framing inspection. GA allows builders to retain "private inspectors" when the county inspectors can't get their "fast enough". Would it surprise you to know that the framing inspector was the same engineer?

  • KMS Woodworks KMS Woodworks on Mar 15, 2012
    Nothing like lying through your teeth to cover your own a$$. It reminds me too much of politicians...The bummer is the little guy is the one that gets left holding the bag.

  • The key word should be "good" home inspector....there are too many mill school inspectors out in the market who really don't have a clue...and sadly many real estate agents recommend inspectors they know who do a light inspection....always check your inspector out thoroughly and don't go cheap