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Posts: 2
Registered: ‎02-02-2013

Deceived Buyers - should we stay the course or bail?

I think I already know the answer but I really hope that other people never have to face what I have gone through during the last several months.  I became a home owner in the fall of 2012 and it seems that everyone in the process really screwed us over, especially the seller who is essentially an unscrupulous company (Canterbury Lots 68) that buys a bunch of houses on the very cheap and then flips them for huge profits -- while the buyer is stuck with a badly remodeled home.  We not only forked over almost our entire savings for a 20% down, but we have seen the rest of our savings dwindle to nothing after all the repairs we have had to make.  The seller really did a number on this house and failed to disclose many faulty items.  They made everything seem brand new and remodeled and called the home completely "turnkey," and as soon as the documents were signed sealed and delivered, we started seeing the house fall apart one section at a time.  The vent in the kitchen is useless and noisy, none of the cabinet doors close properly, the paint from the bathtub has already chipped away so the tub is entirely green (disgusting color), the electrical was wired so badly that it's been deemed a danger and very costly to repair, the plumbing has to be replaced as well, there are leaks, and the list goes on and on. 


I have contacted the City about the work that was done because some permits had been pulled, and they indicated that the "flipper" had been doing a bunch of work without trying to obtain permits first and basically avoided taking any responsibility for not monitoring this flip more thoroughly.  My home inspector is another person that missed a lot of these issues and of course we are upset with ourselves for not canceling escrow when we knew in our guts that we should have.  We had a bad feeling about the sellers during the entire process.  Now we are stuck with this house and have to deal with trying to save up the money to fix the shoddy work that was done.  I truly hope that no one ends up in the same position we are in.


Anyway sorry for all the venting, but if you were in my shoes....hoping you will never be....would you stick this out and sell when market conditions improve, or would you sell right away and start anew?  It would be nice to see what you all think. 

Silver Contributor
Posts: 497
Registered: ‎07-17-2012

Re: Deceived Buyers - should we stay the course or bail?

i'm sorry to hear all that happened to you.  did you use a home inspector during the inspection period?

Regular Contributor
Posts: 109
Registered: ‎11-09-2009

Re: Deceived Buyers - should we stay the course or bail?

Didn't you purchase a one year home warranty?

Posts: 39
Registered: ‎11-15-2011

Re: Deceived Buyers - should we stay the course or bail?

If you're already this miserable why stay any longer.  Get out while the market is still hot.  



Trusted Contributor
Posts: 184
Registered: ‎06-21-2008

Re: Deceived Buyers - should we stay the course or bail?

"would you stick this out and sell when market conditions improve, or would you sell right away and start anew?"


Personally, I'd try to make some lemonade. 


It's a little bit tricky because you don't have the same "distance" from the issues that the flipper had - you're fully aware of the defects so you're (in theory) on the hook to disclose them.  Now you could take the approach that many homeowners take, the "Oh, we never noticed that large puddle of water mixed with pieces of the ceiling in the middle of our dining room.", but then you're just doing to others what you didn't like someone else doing to you.


So I'd take a deep breath, start researching some of the stuff that you need to tackle and identify what you can get done yourself versus what you need to hire someone to do.  The vent, cabinets, tub, etc.?  All potentially (at least relatively) easy and inexpensive to tackle.  I wouldn't be "waiting for the market to improve", I'd be doing whatever I could do to improve my position regardless of the market.  If you're completely adverse to a long-term DIY project then I'd be talking to a some realtors to figure out if I could get out (sell) without taking a loss (or at least understand what my damage might be if I took that route).


I don't have a big axe to grind with home inspectors in general, but I've also never seen a home inspection that satisfied me.  Even with the understanding that time is money, the need to be non-invasive, the desire to maintain good relationships with the realtors involved, etc.  Some specific things that I've seen home inspectors miss, that we've had to point out to them or that we've discovered later include an ancient furnace, well past it's life expectancy and with a completely corroded heat exchanger (equaled a new furnace), visible water damage to ceilings and walls (= a new roof), a "bedroom" with no heat source (doesn't have to have a closet to be called a bedroom, but it does have to have a heat source = new ductwork and register), a small leak in a bathroom that was declared "repaired" (= tearing out and replacing the entire floor of the bathroom including the floor joists), etc.


And of course, none of these items were "disclosed".


But then we've never bought a flip, we've always bought "fixers" and improved them over time.  I'd imagine that it's a completely different mindset when you're buying (what's been advertised as) a turnkey property so I am very sympathetic.  Best of luck.

Super Contributor
Posts: 221
Registered: ‎10-29-2012

Re: Deceived Buyers - should we stay the course or bail?

There'll be plenty of people in your shoes. If the sellers really glossed over the rehab and the inspection didn't highlight dangerous and faulty electrics, go back to your broker and ask him to contact the seller. I don't see any harm in asking them to fix these things. From the response you get, you'll at least know what kind of battle you have. It might also be an idea to contact a RE attorney. I wouldn't settle for buyer remorse, if you think you were deceived. That's fraud in my books and reprehensible. Just be sure you have a clear cut tangible claim, and resist the temptation to window dress it. That's probably what I'd do anyway. Good luck and report back your findings.

Posts: 5
Registered: ‎02-05-2013

Re: Deceived Buyers - should we stay the course or bail?

Sorry to hear that. I have been looking at homes to buy but I have always been very leary of flipped homes. Some of the listing agents came right and told me that all the flippers usually do is upgrade the kitchen and maybe some new fake hardwood floors but the important stuff like plumping and electrical upgrades they usually skip. One said "if it ain't broke they don't touch it." With that said I think you should sue them right away. Don't wait too late to sue. An attorney could advise you on this better.

Platinum Super Contributor
Posts: 11,316
Registered: ‎05-30-2009

Re: Deceived Buyers - should we stay the course or bail?

If you signed the arbitration clause then you may not have any option to sue.  Read your contract.  There are plenty of buyer beware clauses in the contracts. 


If you sell, there is no guarantee that you will not have these problems is a future home.  You will have to disclose what you know.


"you should sue them right away" usually is said by someone who has never been involved in a lawsuit.  Lawsuits consume your life until resolved. They cost money and there is no guarantee that attorney and costs will be included in a settlement.   It can take years to get to trial and during that time attorney costs continue. We were involved in a property lawsuit that took years to resolve.  We prepared the exhibits and did much of the research which reduced costs.  In the end we spent over $40k in legal fees and the opposing side spent at least double that.


Then there is the matter of proving that not only the buyer did their due diligence that the seller knew about the items.  It's tough to prove what anyone knew legally.  Most flippers never live in the home so unless they opened the walls they wouldn't know the state of plumbing or electrical in the same way someone who lives in a home does. This is likely why they don't look and don't ask.  Even if a contractor sees something they may or may not tell the flipper.  I'd expect that a flipper would not want the contractor to tell them anything that they would have to disclose.  


Figure out how much it would cost to do the remediation (not improvements). If you sue the worst case is you spend lots of money and lose.  If you win legal costs may not be included as our court system requires each party to pay their own fees.  There are exceptions to this but there is no guarantee that they will applied to any civil lawsuit.  


You could sue in small claims court up to the maximum to avoid legal fees.  The seller (defendant) can appeal the decision which puts in into a civil lawsuit in superior court.  The buyer (plaintiff) can not appeal the decision. 





Super Contributor
Posts: 213
Registered: ‎03-29-2009

Re: Deceived Buyers - should we stay the course or bail?

abenjami wrote:

Didn't you purchase a one year home warranty?

Waste of money and a ripoff. Usually excludes pre-existing conditions and wear a& tear, which they will argue all of the problems were there prior to purchase or a result of age.

Super Contributor
Posts: 318
Registered: ‎03-28-2009

Re: Deceived Buyers - should we stay the course or bail?

I learned a lot when I bought my first house. learned that a lot of the stuff that was put up for cosmetic purposes was done to hide poor quality work underneath. tons of poorly placed asphalt and cement in the backyard that was covered up with dirt and plants, etc etc. Just a lot of crappy work.  Kinda sucks to discover you have an extra $15K to spend on stuff you never thought about having to do.


So, the lesson I learned is to make better informed decisions going forward. In your case, I would make a decision based on your position now.  How much will it take to get the house where you want it? Is that worth spending over going through the sale of the house and starting over? you can't change what happened, you have to make the best decision going forward.