If I renovate my house only to find significant fire damage, do I have to disclose this when i sell? More...?

Question

I just bought a house 2 weeks ago. While I was in the process of ripping down the walls to do some upgrades, I found much of the wood has been charred and some beams have been sistered (some have not)

The seller never disclosed to us that there was ever a fire in the house.

the house is 97years old, so it could have happened before her.

HOWEVER - the house has brand new windows, and the old molding from the house was saved, and reinstalled.

This means, the owner before us SAW the fire damage even if she didnt cause it.

1. If we can prove it happened while she lived there - do we have any recourse?

2. If we can prove it happned before she lived there, but she definitly KNEW about the fire damage, do we have any recourse?

We live in New Jersey.

Answer 1

Disclosure is a State law in Michigan and, in fact, it just happen right near us. A house fire, ironically, led to disclosure of a newer fire that happen before the new residents bought the home a few years before. There were reports of the fire as reported through the fire department and made public, this should have been reported by the Real Estate firm but, was overlooked, shelved for a better word.

The new owners sued the Real Estate firm and won. The Real Estate firm and the Realtor were both fined and a license was taken away.

Answer 2

Assuming the previous owners are honest people, You are very correct in your thinking that there is a chance, on a 97 year old house, that the fire could have happened prior to the previous owner. If that was the case, then the folks you bought it from are legally clear, because it was in between the walls.

You'll have to do some investigating. I would suggest going to the closest fire department and ask if they keep records of any fire at your address. Your insurance company is another resource, they can do a "check" on the address and see if any major fire claim has been made in the last ___ of years (this varies by state). You can also call the local fire marshall and see if they may be able to give you an estimate of how long ago the fire was.

That is how you can prove your previous owners knew about it. You can also check the local building permit office to see if there was any permits taken out for remodeling in that area....even if the damage was hidden, if the previous owners remodeled that section, there will be a record of it.

I would also contact the Realtor you used...this is part of the service for them to advise you on recourse as well as your Real Estate attorney.

I wish you luck...it's a tough spot to be in.

Answer 3

Even if she saw charred wood, she might not have assumed there was a fire. Maybe she thought it was dry rot or maybe the contractor installing the windows never mentioned it. You can't prove she knew anything and even if she did know, if the house has been shored up and made stable, it really doesn't impact you or the value of the house so you wouldn't be able to prove any damages.

Also, I am wondering if that is something you might have recourse with against the title insurance company since a fire would have been a matter of public record.

Answer 4

The issues here are whether any new buyer should be made aware of what you know is detremental regarding the property. The answer in New Jersey is they have to know. I would suggest that you go and look at the link provided
Real Estate Full sales Disclosures – Study notes
http://www.njretest.com/study_notes/resfda.htm
Also because of the age of the home the Federal government will require the seller and or the seller's broker to provide any potential buyers with a federal pamphlet having to do with the dangers of lead. To read more on that issue you should go to
EPA’s Required Lead Disclosure from Sellers and brokers:
http://www.epa.gov/lead/pubs/leadbase.htm

Best of luck to you

Answer 5

The new laws require a person/realtor to disclose damage to a house. I would contact the realtor and initiate a claim against the seller. If there was a fire, there should be some records somewhere, either w/ the city or the FD.