3ADL Wisdom

[Saggy Aggie]

Alright 3ADL, you guys are usually reliable...

I'm in the process of buying a house and on the day before my closing, I had my final walk through. Said walk through happened to be a couple days after hurricane Harvey....

I had drove by a couple times during and after the storm so I knew it didn't flood, but I was concerned about leaks. Low and behold, I found a leak in the living room ceiling and mold in an upstairs closet near the living room ceiling (the leak had gone untouched for several days in an unairconditioned house).

Long story short, the sellers and I delayed closing and it appears to be in their best interest financially to file an insurance claim.

They say the house is a financial burden for them since they've already moved out and we've already delayed closing a lot. They're willing to pay the deductible and have the insurance take care of the repairs but they want me to go forward with closing and takeover and manage the repairs through their insurance.

Have you guys ever heard of a situation like this? Would the bank even allow it? I called them today and no one there could give me an answer. They all said they need to talk to their bosses tomorrow.

Would you do it? What risk am I exposing myself to? I only intend to do it if I get the green light from the insurance company in writing that they're going to pay for the repairs and if they give me a document that says the insurance money will go directly to the contractors or to me and not the sellers. Thoughts?

[bobcat1]

I wouldn't close until it's fixed. Once they have been paid you lose all power.

[buckeyebob]

Alright 3ADL, you guys are usually reliable...

I'm in the process of buying a house and on the day before my closing, I had my final walk through. Said walk through happened to be a couple days after hurricane Harvey....

I had drove by a couple times during and after the storm so I knew it didn't flood, but I was concerned about leaks. Low and behold, I found a leak in the living room ceiling and mold in an upstairs closet near the living room ceiling (the leak had gone untouched for several days in an unairconditioned house).

Long story short, the sellers and I delayed closing and it appears to be in their best interest financially to file an insurance claim.

They say the house is a financial burden for them since they've already moved out and we've already delayed closing a lot. They're willing to pay the deductible and have the insurance take care of the repairs but they want me to go forward with closing and takeover and manage the repairs through their insurance.

Have you guys ever heard of a situation like this? Would the bank even allow it? I called them today and no one there could give me an answer. They all said they need to talk to their bosses tomorrow.

Would you do it? What risk am I exposing myself to? I only intend to do it if I get the green light from the insurance company in writing that they're going to pay for the repairs and if they give me a document that says the insurance money will go directly to the contractors or to me and not the sellers. Thoughts?

Did you have a home inspection by a licensed professional...if not, get one. If you are talking about one leak & some mold (their are different kinds of mold). from there you can make a decision. Otherwise, run like hell.

[44INAROW]

As an insurance agent, I wouldn't write the policy until the repairs were done and inspected. Sorry for the sellers but it is what it is. Of course, your agent probably won't know there is interior damage but I just don't think it's a wise decision for you.


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[lostaussie]

As an insurance agent, I wouldn't write the policy until the repairs were done and inspected. Sorry for the sellers but it is what it is. Of course, your agent probably won't know there is interior damage but I just don't think it's a wise decision for you.


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I'm with FoFo and I ain't never sold no insurance. Not your problem.......but it could be real fast.

[Saggy Aggie]

Did you have a home inspection by a licensed professional...if not, get one. If you are talking about one leak & some mold (their are different kinds of mold). from there you can make a decision. Otherwise, run like hell.

I had a general inspection done well before the storm which turned up some stuff but nothing related to the storm obviously.

After I found the leak and the mold during the final walkthrough, I hired a mold and water damage specialist to prove my suspicions and they did. I then had a mold remediation protocol written and have contacted several mold remedistion professionals for quotes. That's what led us to the conclusion that it's probably in their best interest to file a claim. I think we are pretty confident now that we know the extent of the problem and what it's going to take to fix it properly.

I had my new homeowners policy written a while back and it is effective whenever it is that I end up closing... if I close....

[44INAROW]

I had a general inspection done well before the storm which turned up some stuff but nothing related to the storm obviously.

After I found the leak and the mold during the final walkthrough, I hired a mold and water damage specialist to prove my suspicions and they did. I then had a mold remediation protocol written and have contacted several mold remedistion professionals for quotes. That's what led us to the conclusion that it's probably in their best interest to file a claim. I think we are pretty confident now that we know the extent of the problem and what it's going to take to fix it properly.

I had my new homeowners policy written a while back and it is effective whenever it is that I end up closing... if I close....

Good luck. I wish you the best.


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[regaleagle]

I've been doing this for 30 yrs.......here's the answer. As long as it is written into the contract, what the sellers suggested will fly. Your insurance company will insure you if the repairs are noted. It would help if you had a written estimate from a contractor, but is not absolutely necessary. The insurance claim will automatically go thru the insured at the time of the occurrence......which is the seller. I highly suggest you demand a copy of the adjustment papers when the seller receives them. The adjustment papers will show any and all damages, whether a new roof is required(high winds could have caused uplifted shingles), and the itemized amounts allowed for those damages. Possibly a loose fence? Or gutters? Check for any loose siding around the house. The insurance company will automatically subtract the seller's deductible from the claim......that will be the seller's responsibility to pay. They may also subtract some "depreciation" from the claim.....which is totally recoverable upon presenting proof that the work has been completed.....usually invoices provided by the contractor. If you have any other questions or need any further advice, please feel free to PM me here. It is a normal course of events when dealing with storm damaged properties that there will be some pending real estate transactions on properties that got damaged......I deal with this every year.

[Saggy Aggie]

Lender said today that they want the repairs done prior to closing, so I guess that settles that

[bobcat1]

Lender said today that they want the repairs done prior to closing, so I guess that settles that
I don't blame them. Good call

[Saggy Aggie]

I don't blame them either. I felt like I was opening myself up to some risk but I guess I could have gotten comfortable with it if I had some written and signed agreements with the insurance company and sellers.

This seems like a much better route to me