Let's say you're a buyer and we've already convinced you of the importance of getting a Municipal Lien Search. That's awesome. Because on top of your other closing costs, it's a comparatively small fee that lets you know if there are any hidden debts on the property you're about to purchase so you're not surprised by the potential for HUGE costs down the road.
Why should every home buyer insist on a permit search before purchasing a home?
One piece of a full Municipal Lien Search is a record search through local building departments, checking on Open and Expired Permits. This is arguably one of the most important pieces of due diligence. To demonstrate, we're looking at a few ways a permit search could save you money and save your butt. They'll have you insisting on a permit search the next time you're looking to buy:
1. If you ever want to do any updates to your new home.
Remember this blog we posted back in November? A Gainesville couple who wanted to add a back porch to their home were blindsided when they went to pull a permit and couldn't because a previous owner had taken out a permit, fixed the roof, but never had a final inspection. Luckily the worst part for this couple when getting the issue resolved was the run-around between the building department and the original contractor--and then the wait. But in many cases an open and expired permit problem can be costly for owners to resolve.
2. If you want to know if updates were done legally and properly.
You're thinking about buying a home and the listing boasts a brand new roof, or a completely updated kitchen. (Woo-hoo!) You should also be thinking about whether or not the work was done properly. If a previous owner never took out a permit and the local building department finds out, you could be liable to fix anything that may not be up to code. Even more worrisome, if these updates were never inspected by a licensed professional, there's a possibility it was done incorrectly and could be unsafe--especially if the former owner was an inexperienced DIYer.
3. If you want to know more about the home's past.
If you get a permit search, you can look back for a period of time and learn more about the history of the home. When was the last time the roof was replaced or repaired? The air conditioning, plumbing, electrical? Compare that to the age of the home and you can guess what kind of major repairs you'll likely have to make in the future and weigh that into your purchasing decision.
How do you make sure a permit search is done on the house you are buying?
1. Protect yourself by knowing what to ask for.
Talk with your Real Estate agent about it. They can communicate to the Title Company what you want. Be sure to ask for an open/expired permit search or a full permit history (if available) when a municipal lien search is ordered.
2. Remember you want to order the search DURING the inspection period
It is possible that the title company is ordering a Municipal Lien Search on the property, but forgoing the permit portion. Ultimately it's the buyer's responsibility to know what to ask for and in this case, it's a Municipal Lien Search with Permits.