Q: I bought a single family residence in august of 2021 and didnt know adu was unpermitted until middle on transaction.
I bought a SFR in August of 2021. Market was really hot back then and I ended up offering 50k over asking price for a property that looks good from afar but was remodeled without permits (kitchen, added a 4th bedroom) plus converted garage to an ADU and nothing was done to code. The sellers nor sellers agent never disclosed anything on their marketing material and only did so after we had already submitted our offer. They called my agent and told them that the ADU was not permitted. I was already emotionally involved in the transaction plus with the hyper competitive market during that time I proceeded with the transaction but they still didn't put anything on paper and now that time has gone by and I'm trying to correct all of the poor quality build plus bring the adu up to code I feel like I was defrauded. Even when I told the city's construction inspector, he told me I should get compensated for that because the work will be expensive. I found out before releasing contingencies
You may be entitled to compensation in the amount of the difference between what you paid for the home and the true value of the home with the defects, which may be close to the cost of repairs.
Did you find out about the illegal work before or after you released your contingencies on the purchase contract?
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A: Unfortunately you admit that you were informed during escrow and before closing and you decided to proceed with the purchase. That means that you had knowledge and cannot claim failure to disclose. In other words, litigation will cost you quite a bit and you are not likely to succeed given the facts. You might want to consult with a real estate attorney who will need to review all your paperwork to confirm whether there were any written disclosures during escrow (even if not in the marketing materials) to confirm whether you may have a legal claim or not but your own admission remains problematic.
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