Sellers Won't Fix Leaking Roof; Fear of Additional Damage

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ChupaChups
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Sellers Won't Fix Leaking Roof; Fear of Additional Damage

Post by ChupaChups » Tue Jan 13, 2015 11:57 pm

We are about to close on a house in a few weeks as buyers. When we did the home inspection in November, the inspector pointed out that there was evidence of leaks from the roof in various places throughout the house that seeped into the drywall. He suggested we get a roofer to take a closer look which we did. The roofer pointed out that while the roof was only around 15 years old, the installation was so improper that the trapped heat within the attic caused many of the shingles to curl upwards hence the leaks in various places. The roofer also saw active leaks in the house because it had snowed the week before. The leaks come whenever there is snow that sits on the roof or after a heavy rain. The roofer suggested patching as a temporary fix until we can re-roof in the spring/summer. The re-roofing will cost $15K. I plan on getting more quotes after closing but the $15K seems like a fair price given the size of the roof (2,000 sq. ft. or 20 squares).

All this was done during the inspection period and when we approached Sellers about fixing the roof (among other items), they gave us a few thousand dollars off of the contract price and basically told us take it or leave it. We like the house and while we were disappointed that we would have to pay for a new roof on top of what we were paying for the house, we decided to take it.

Fast forward to today and there have been more snow and more rain. I am worried about the condition of the interior. We proposed to the Sellers that we would pay to patch the roof but their attorney rejected our proposal because of "liability" reasons. We have the right of the walk-through on the day of closing and my attorney told us that Sellers have to keep the house in the same condition as the day our inspector saw the house, meaning if there were leaks back then, then our accepting their few thousand dollars meant we could not force them to fix it. But if the damage was exacerbated, then it's up to us to "prove" that the damage was not there on inspection day. The inspector took pictures so I am hoping to get them from him but obviously they will not be of every wall and ceiling so I fear this is going to be fight.

Any counsel you have for my situation would be greatly appreciated.

mhalley
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by mhalley » Wed Jan 14, 2015 12:54 am

Walk (nope, i mean) RUN away. There could be water damage that has not been found, black mold, etc. I would get the 15k off at least.
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Busting Myths
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Busting Myths » Wed Jan 14, 2015 1:13 am

Indemnify the seller for any roof related damage (bad idea) or ask if you can get a temporary tarp installed (more cost to you but a compromise for all parties).

mhalley wrote:Walk (nope, i mean) RUN away. There could be water damage that has not been found, black mold, etc. I would get the 15k off at least.
Mike

Sounds like it is too late now. The seller has already agreed to a discount so if the OP tries to walk they will probably lose their deposit due to failure to perform.

SDBoggled
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by SDBoggled » Wed Jan 14, 2015 1:37 am

I second the recommendation for a tarp... seems it would be very cheap insurance against further damage and headaches.

August
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by August » Wed Jan 14, 2015 2:33 am

Slightly off topic, but $15k for a 20 square shingled roof seems quite high even for a high cost of living area. I would expect the quote to be in the neighborhood of 7-10k. I would recommend getting a second estimate (unless the $15k estimate includes interior repairs as well).

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by bnes » Wed Jan 14, 2015 3:58 am

An infrared inspection can find hidden water/mold issues... and seems worth it in your case.

sambb
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by sambb » Wed Jan 14, 2015 6:33 am

walk away. if you lose money, you lose money. there is always risk. you might lose more money if you keep the house

Cigarman
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Cigarman » Wed Jan 14, 2015 6:40 am

You know that you are on the hook for at least $15k in repairs for the new roof so if you will lose less than that by walking away, do so.

My experience has been that if the roof is bad, what else (unseen and not associated with the roof) will be discovered after closing. Sounds like the sellers are not the most stand up people.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by rustymutt » Wed Jan 14, 2015 6:50 am

I'm looking to buy a house myself, and have been horrified by the issues I find on homes. Water damage is the worst kind because of how it penetrates a home and gets into walls and cracks that you can't even see. It sits there and molds. I'd walk away from this house. Water damages insulation beyond repair.
These sellers aren't stand out people, if they've known about this, and did nothing as it appears.
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by LifeIsGood » Wed Jan 14, 2015 7:12 am

August wrote:Slightly off topic, but $15k for a 20 square shingled roof seems quite high even for a high cost of living area. I would expect the quote to be in the neighborhood of 7-10k. I would recommend getting a second estimate (unless the $15k estimate includes interior repairs as well).


I agree. We had our house re-roofed a couple of years ago. We paid around $15K for 58 squares and that included some decking replacement. Definitely get a couple of quotes. I found that in the roofing business it's "Buyer Beware!".

saladdin
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by saladdin » Wed Jan 14, 2015 7:47 am

You know the damage is there and yet you want to keep the house. You agreed to the price and the sounds of it signed the contract. Your decision has been made.

This has to be your first house because almost no one with any experience with owning a home would be going through with this deal. I don't see the average bear buying a house knowing everytime it has rained for the past year(s) that it pours into the attic. The leaky roof is just the beginning. The water that came into the house went somewhere and caused other damage. Mold and mildew could be hidded. The water had to go somewhere, I'm betting you have some hidden ceiling damage. The insulation in the attic had to have gotten damaged too. The water could have ran down the sides into your walls causing damage in the wall cavities.

As for the 15k price tag. I'd say that's a tad high unless your roof has a weird pitch but in all honesty if you can get it down for 10k you are going to end up spending another 5k on replacing insulation, replacing ceiling water spots, baffles, vents, facia board or anything else water damaged. You may want to have it bug sprayed since water will attract insects and holes will invite squirrels.

I would have walked away the second they refused to cover the new roof. One thing I've learned is people that allow major damages to go unfixed means there will be tons of minor stuff neglected.

Best of luck. You'll need it.

crg11
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by crg11 » Wed Jan 14, 2015 7:47 am

Losing a deposit is far less money than what this roof business is likely to end up being. Remove emotion of losing the house from the equation...do you want to put up with the possibility of far more damage lurking around outside of the $15k for the roof? This could fast become a money pit.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by dognose » Wed Jan 14, 2015 8:22 am

Run from this deal. No matter how much you may like this house, a long-running roof leak will become a long-running financial disaster for you. One suggestion: If your purchase is contingent on obtaining a mortgage, you could inform the mortgage company of your roof problems prior to closing. The mortgage company might then withdraw their financing approval. Happens all the time. No financing, no house deal. If the sellers want to start suing people, they may think twice if they also have to get into a prolonged legal battle with a bank.

stan1
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by stan1 » Wed Jan 14, 2015 8:51 am

Houses are seldom perfect in all ways (and if you find one that is perfect you are likely paying more for that condition). You'll need to weigh the positives of this house (the reasons you are buying it) with the negatives which now include a new roof, unknown water damage, and whatever else the seller didn't disclose. I won't tell you to walk away because I don't know the positives of this house but it does sound like those positives are coming a price higher than the purchase price. If you were planning on doing a lot of remodeling on the house anyways these costs may be a small percentage of the total budget. If you need the house to be in move in condition and don't have the budget/desire to do any work on the house then you need to think long and hard.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by TT » Wed Jan 14, 2015 8:55 am

Walk away from this house and do not look back. If there is black mold that has penetrated the roof plywood and perhaps the rafters 15K will not come close to repair the damage.
A work acquaintance spent 50K+ to repair all the damage from black mold in roof of his house. Also, if the current owner neglected this what else is lurking for future repairs.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Gropes & Ray » Wed Jan 14, 2015 8:57 am

Before you decide to walk away, have an attorney review your contract to make sure that you're only liable for your deposit (or "hand money") if you break the deal without cause. That is typically the case, but I would want to be double extra sure before I broke a contract for a purchase of real estate.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Grt2bOutdoors » Wed Jan 14, 2015 8:59 am

You made a huge mistake when you agreed to take a discount off the purchase price. Essentially, you are stuck because on the day of the walk through, unless you have a roofer on hand to inspect it, you are not going to find damage that is above and beyond what was seen initially. Typically, damage doesn't progress that quickly to failure. This is one of the lessons in purchasing a home - I learned mine when 2 weeks after closing my sewer pipe inside the home gave way, thankfully the outlay was smaller. Still, years later it bugs me.
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Grt2bOutdoors » Wed Jan 14, 2015 9:03 am

saladdin wrote:You know the damage is there and yet you want to keep the house. You agreed to the price and the sounds of it signed the contract. Your decision has been made.


As for the 15k price tag. I'd say that's a tad high unless your roof has a weird pitch but in all honesty if you can get it down for 10k you are going to end up spending another 5k on replacing insulation, replacing ceiling water spots, baffles, vents, facia board or anything else water damaged. You may want to have it bug sprayed since water will attract insects and holes will invite squirrels.

I would have walked away the second they refused to cover the new roof. One thing I've learned is people that allow major damages to go unfixed means there will be tons of minor stuff neglected.

Best of luck. You'll need it.


Nah.....$15K is the going rate for roofs of 20 squares. A roofer friend of mine told me all of the materials (5/8" plywood sheathing underlayment, frostguard, ice shield, aluminum caps, 30 year Timberline architectural shingles, cobravent) costs about $2,500, the rest is labor and profit. In 2 days the entire roof will be ripped off and installed new.
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by fposte » Wed Jan 14, 2015 9:06 am

I don't know the square count of my roof, but it's a lot smaller than the OP's and I'm in a low cost area; I got quotes from $10-$18k in 2014, so I think $15k for what he describes seems quite reasonable.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Grt2bOutdoors » Wed Jan 14, 2015 9:09 am

Cigarman wrote:You know that you are on the hook for at least $15k in repairs for the new roof so if you will lose less than that by walking away, do so.

My experience has been that if the roof is bad, what else (unseen and not associated with the roof) will be discovered after closing. Sounds like the sellers are not the most stand up people.


Most sellers are not. My sellers wouldn't budge on my request to repair a cast iron sewer pipe that looked like it was about to go, the home inspector said it wasn't a concern, 2 weeks after the close - it went. Set me back $2K. :annoyed Home had some brass piping with calcium deposits showing on the outside walls, wanted a discount for that - again home inspector said "its not leaking" therefore it's in "fair/good condition" :annoyed - I ripped those out and replaced it with copper.

To the OP - Be prepared, no home is perfect and this goes beyond cosmetic changes, a home requires maintenance. If you plan on living in the home for the next 15-30 years, fix the roof and enjoy the home. If the seller gave you $5K, your new roof will be the equivalent of spending $665 per year over the next 15 years. That is nothing.
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barnaclebob
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by barnaclebob » Wed Jan 14, 2015 9:15 am

Looks like your options are to walk and lose earnest money or be prepared to spend more every time you do a renovation in the areas that are water damaged due to possible mold mitigation. I hope this is otherwise a really nice and unique house or bought at a discount if its run of the mill.

Its likely that these problems aren't very new so one or two storms probably wont make the damage much worse. It seems like you were willing to buy the house with the damage you saw which means it couldn't have been that bad.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Jack FFR1846 » Wed Jan 14, 2015 9:24 am

The sellers did nothing wrong and are just fine "stand up" sellers. They offered a discount on your findings and you took it.

I sold a car recently. As part of the deal, I brought the car to a mechanic for a pre purchase inspection. The report found that the car would soon need a clutch ($1000). In the mean time, I received another offer for $800 more, and I disclosed the ppi issue found. The first buyer came back looking for $1000 off for the clutch. I said no, that I would honor our agreed price. Otherwise, I would take the other offer. He accepted.

Am I not a stand up guy because I'm looking out for my best interest?

Same here. If you knew that the roof would cost $15k and accepted a few thousand off the price, it's your decision to buy the house and fix it yourself.
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bottomfisher
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by bottomfisher » Wed Jan 14, 2015 9:50 am

So far the consensus has been to walk away from the deal. I agree. Its difficult to do so when you've invested so much time and emotion into the process. However, as others have noted above, it will inevitably require much more time, money, emotion to mitigate all the issues from water damage. I also feel that they may be further issues not yet discovered (or disclosed) as a result of inferior construction and/or design.

For the most part, I don't feel the sellers are doing anything terribly wrong. Its their right to offer a take it or leave it deal depending on how motivated they are to sell. I agree with the attorney regarding a liability issue if you were to start addressing issues prior to closing. However, I personally would have been more agreeable and discounted the cost of repairs (or just repaired the issues found on inspection like we did on our recent home sale). But that's their right as sellers.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by jfn111 » Wed Jan 14, 2015 10:22 am

Here's the deal. Repairs are part of the negotiation process. The buyer hires an Inspector. The Inspector finds X,Y and Z wrong. The buyer gets an estimate to fix X,Y and Z.
If the house was priced at the top of the market you would expect the seller to pay all or most of the cost to repair. If the house was already discounted, because of known issues, then they probably wouldn't budge much.
If financing is involved then I'm a little perplexed. Most banks won't touch a house with a bad roof. I just sold a REO house with a bad roof. We had it on the market for over a year until we got them to accept a cash offer for a greatly reduced price. The house "sold" twice but both deals fell through when the banks insisted that the roof be repaired before they would fund.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by dgdevil » Wed Jan 14, 2015 10:31 am

Don't walk away, especially if you like the house otherwise. Just consider this the price of an education, and be prepared to write some big checks. As stated above, every house has its flaws. The roof is pretty much ground zero for many home ailments; once it's fixed, you'll be fine. Mold has also been mentioned, but beware that contractors will often use this as a scare tactic. My roof leaks, but I just live with it (helps living in SoCal).

ddurrett896
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by ddurrett896 » Wed Jan 14, 2015 10:32 am

Kinda off topic, but shop around...$15,000 is ridiculous for 20 squares on a 2,000 sqft even if the roof has a high steep.
MATERIAL
GAF Lifetime shingles are $26/bundle - 3 bundles in a square so $78/square or $1,560 in shingles.
Shingles: $1,560
Nails/underlayment/other material: $1,000
Rent container: $300
Dump material: $300
Total Material: $3,160

LABOR
It's a day job with 4 guys:
4 guys x $10/hr x 10 hours = $400 in labor
Total Labor: $400

The total job will cost around $3,500. The company is making some serious money on this job! I understand the company has to make money, but $11,500 or 300% is crazy. Shop around!

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by texasdiver » Wed Jan 14, 2015 10:37 am

I'm not a real estate professional but I have bought and sold 4 houses over the years.

I seem to recall that every standard sale contract that I signed on either end of the sale was written to be "contingent on financing". In other words, if the bank won't finance the deal is off.

If you are looking for a way to walk away from the deal or to apply more leverage to the seller you might discuss with your lender having the mortgage contingent on having the roof fixed. Then you can tell the sellers that the roof needs to be fixed before you can close and it is out of your hands. This might be a bigger problem in cold climates but here Texas they do roofing work year round.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Busting Myths » Wed Jan 14, 2015 10:42 am

Gropes & Ray wrote:Before you decide to walk away, have an attorney review your contract to make sure that you're only liable for your deposit (or "hand money") if you break the deal without cause. That is typically the case, but I would want to be double extra sure before I broke a contract for a purchase of real estate.

This...Op you are dealing with the seller's attorney so you are negotiating with a better informed party. This is most likely the most costly purchase you will make in life so why not spend a couple hundred bucks and get a professional legal opinion? You can't rely on "well I got opinions from the boglehead forum" if things go sideways and you need to litigate.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by investingdad » Wed Jan 14, 2015 10:44 am

Let's just look at the facts as the OP has presented them to us:

- OP makes offer contingent upon home inspection
- home inspection finds potential roof problem
- roofer provides estimate to fix, $15000
- OP asks Seller to fix the roof
- Seller refuses but offers "a few thousand dollars" as a take-it or leave-it concession
- OP agrees

So, the OP and Seller now know the roof has a problem. It's reasonable to assume that the OP and Seller understand more damage could be happening everytime it rains. OP decides to accept the Seller's offer.

Nature has unleashed quite a bit of rain and snow between time of Acceptance and Closing (which hasn't happened yet, but is coming up). OP is worried about continuing damage and Seller won't let them fix it due to liability issues.

First, I agree with you OP. I'd be concerned as well. I'm on the same page here. However, you knew the roof had a problem after the inspection. You then accepted the Seller's counter-offer. And I think you'd agree that it's fair to say you understood the risk of ongoing leaking between the time of your acceptance and the time of closing. And it's quite possible there was additional damage done, but there's no way to know for sure.

W/o proof of state of damage from the leaking roof on the day of inspection, plus your decision to accept their offer, I think you've assumed the risk and it will be nearly impossible to get money from them for any additional damage that may have been done.

I dont' think the Sellers are doing anything wrong here. They offered a concession and you agreed.

I'm not an attorney, so I suggest talking to one.

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flossy21
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by flossy21 » Wed Jan 14, 2015 11:13 am

I'd walk away as well.

One thing I look for in anything I buy used is evidence that it has been maintained well. For instance, a used car bought from a private party should have service records.

The seller in this case has neglected a very basic thing on the home; the roof leaks. This suggests that the seller may have neglected other issues and not disclosed them.

The bottom line is that there are many homes out there. If I were you I would be intent on finding a way out of the contract.

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magellan
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by magellan » Wed Jan 14, 2015 4:11 pm

IMO there's a difference between a few smallish water stains on a few ceilings versus tens or dozens of mold stained sheetrock areas and rotten rafters and ceiling joists in the attic. You should get more information on the likely extent of damage before deciding anything else. I'd want to focus on what can be seen in the attic. If the attic insulation can be peeled back under the leaking areas, you'll have a better shot at seeing how bad the damage is. Looking down into the eaves in the attic, you may be able to tell if exterior wall sheathing or framing is compromised.

Nearly every house eventually has water infiltration somewhere. This is doubly true of houses in winter climates. Don't panic. Water damage can get expensive if it's not dealt over a long time, but it's also very common and usually relatively straightforward to fix. By the time most people notice water infiltration, it has likely been happening for months or even years. It's rare that water suddenly penetrates a roof and immediately gets noticed inside. Usually the failure increases in scope over time until it's noticed. I wouldn't be surprised if some of the folks advising you to run away from this deal have water infiltration somewhere in their house and don't even know it yet.

Also, even though the roof may be toast, from what you describe the root cause of the problem may be poor attic ventilation. Before you spend $15k on a new roof, make sure the attic is properly vented with the right amount of low intake venting under the eaves and the right amount of high exhaust venting either along the roof ridge or at the gable ends. Even a new roof can leak if poor attic ventilation causes very extensive ice dams.
Last edited by magellan on Wed Jan 14, 2015 4:16 pm, edited 1 time in total.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by FelixTheCat » Wed Jan 14, 2015 4:16 pm

+1 on Walk Away
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by leonard » Wed Jan 14, 2015 4:31 pm

ChupaChups wrote:We are about to close on a house in a few weeks as buyers. When we did the home inspection in November, the inspector pointed out that there was evidence of leaks from the roof in various places throughout the house that seeped into the drywall. He suggested we get a roofer to take a closer look which we did. The roofer pointed out that while the roof was only around 15 years old, the installation was so improper that the trapped heat within the attic caused many of the shingles to curl upwards hence the leaks in various places. The roofer also saw active leaks in the house because it had snowed the week before. The leaks come whenever there is snow that sits on the roof or after a heavy rain. The roofer suggested patching as a temporary fix until we can re-roof in the spring/summer. The re-roofing will cost $15K. I plan on getting more quotes after closing but the $15K seems like a fair price given the size of the roof (2,000 sq. ft. or 20 squares).

All this was done during the inspection period and when we approached Sellers about fixing the roof (among other items), they gave us a few thousand dollars off of the contract price and basically told us take it or leave it. We like the house and while we were disappointed that we would have to pay for a new roof on top of what we were paying for the house, we decided to take it.

Fast forward to today and there have been more snow and more rain. I am worried about the condition of the interior. We proposed to the Sellers that we would pay to patch the roof but their attorney rejected our proposal because of "liability" reasons. We have the right of the walk-through on the day of closing and my attorney told us that Sellers have to keep the house in the same condition as the day our inspector saw the house, meaning if there were leaks back then, then our accepting their few thousand dollars meant we could not force them to fix it. But if the damage was exacerbated, then it's up to us to "prove" that the damage was not there on inspection day. The inspector took pictures so I am hoping to get them from him but obviously they will not be of every wall and ceiling so I fear this is going to be fight.

Any counsel you have for my situation would be greatly appreciated.


What other deferred maintenance have they simply not told you about. Walk away.
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by ChupaChups » Wed Jan 14, 2015 10:47 pm

Thank you all for taking the time to respond. I really appreciate it.

I realize many/the majority of you are in the "walk-away" camp but short of telling the mortgage company to withdraw the loan commitment (and I'm not even certain whether that will work since we are past the commitment contingency deadline), there is probably not another way out of the deal without losing my 10% deposit which would be a substantial financial loss. At this point, my wife and I are resolved to go through with the purchase. When we were offered the few thousand dollars, we seriously asked ourselves whether we should proceed with the purchase. After much deliberation, we concluded and justified to ourselves that paying for the roof would not be a big deal over the long term as we plan to stay in the house for the next 20-30 years (this is along the same lines of Grt2bOutdoors's response). So after that point we knew that we will have to replace the roof and possibly the plywood under the shingles. I agree that there is a possibility this will become a money pit but all old houses have this possibility. This house is newly renovated in certain parts which somewhat narrows the old house parade of horribles, the exception being the roof and the other items found by the home inspector. We will look for black mold (none was found visually by the home inspector but the standard language in his report deferred to consulting a mold expert) and propose using a tarp as a temp. fix as suggested; thank you. I also did some research on the infrared inspection but may be a bit late to pursue as we now know the source of the leaks (maybe). My plan is to line up other roofers to look at the house right after closing to get additional quotes. The data points on pricing and the breakdown of roofing material and labor prices were helpful; thank you.

The attorney who is representing us basically says it's going to be a fight if there is additional damage from the time of the inspection to closing. I am trying to get the pictures that my home inspector took the day of the inspection as reference points. We could ask Sellers to fix any additional damage and delay closing but that would not be prudent on our part being that our mortgage rate lock is good until a short time after the scheduled closing date.

We still like the house even though there will be work involved. Most of the houses were built in the 1950's in this particular town. The town is desirable because the public schools are good. And in this particular neighborhood, it is quite rare for a house to come on the market that is priced right and in somewhat decent condition. It typically attracts multiple offers so that skews the balance of power even more in favor of sellers.

I will keep this forum updated on what happens. Thanks again.

leonard
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by leonard » Thu Jan 15, 2015 12:00 pm

ChupaChups wrote:Thank you all for taking the time to respond. I really appreciate it.

I realize many/the majority of you are in the "walk-away" camp but short of telling the mortgage company to withdraw the loan commitment (and I'm not even certain whether that will work since we are past the commitment contingency deadline), there is probably not another way out of the deal without losing my 10% deposit which would be a substantial financial loss. At this point, my wife and I are resolved to go through with the purchase. When we were offered the few thousand dollars, we seriously asked ourselves whether we should proceed with the purchase. After much deliberation, we concluded and justified to ourselves that paying for the roof would not be a big deal over the long term as we plan to stay in the house for the next 20-30 years (this is along the same lines of Grt2bOutdoors's response). So after that point we knew that we will have to replace the roof and possibly the plywood under the shingles. I agree that there is a possibility this will become a money pit but all old houses have this possibility. This house is newly renovated in certain parts which somewhat narrows the old house parade of horribles, the exception being the roof and the other items found by the home inspector. We will look for black mold (none was found visually by the home inspector but the standard language in his report deferred to consulting a mold expert) and propose using a tarp as a temp. fix as suggested; thank you. I also did some research on the infrared inspection but may be a bit late to pursue as we now know the source of the leaks (maybe). My plan is to line up other roofers to look at the house right after closing to get additional quotes. The data points on pricing and the breakdown of roofing material and labor prices were helpful; thank you.

The attorney who is representing us basically says it's going to be a fight if there is additional damage from the time of the inspection to closing. I am trying to get the pictures that my home inspector took the day of the inspection as reference points. We could ask Sellers to fix any additional damage and delay closing but that would not be prudent on our part being that our mortgage rate lock is good until a short time after the scheduled closing date.

We still like the house even though there will be work involved. Most of the houses were built in the 1950's in this particular town. The town is desirable because the public schools are good. And in this particular neighborhood, it is quite rare for a house to come on the market that is priced right and in somewhat decent condition. It typically attracts multiple offers so that skews the balance of power even more in favor of sellers.

I will keep this forum updated on what happens. Thanks again.


They should not be able to keep your 10% deposit (I assume earnest money?). Also, if they aren't willing to spend the extra to fix the situation - they won't want to spend money on a lawyer to defend themselves in this situation. Which is what you should do if there is any problem getting out of this deal.

Why exactly do the opinions (that you solicited btw) saying "walk away" not hold merit?
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Miakis » Thu Jan 15, 2015 12:28 pm

I wouldn't walk away. I've struggled with a leaky roof before and it took a couple of months to get it fixed (had to keep waiting until the next rain to find out if the leak was fixed - and who knows how long it was leaking before we noticed it). It got fixed eventually. The minor leaks did not cause any lasting damage. I assume buckets of water aren't flooding into this place, or else you'd have seen evidence of serious damage.

If possible, I'd schedule the roofer to come back at the walkthrough and assess whether the damage has gotten much more severe since he last saw it. If he raises further issues, then you delay closing (see magellan's post).

From the sellers' point of view - their roof isn't that old and a roofer came and told you that you needed a new roof because of "bad installation." They haven't witnessed any problems with their roof in the last 15 years - so what interest do they have in replacing it on the word of one guy who probably wants the job? And it sucks that they won't let you patch it - but they are following the advice of their attorney. It doesn't sound like they're out to screw you or something.

People are right - there is always a risk that this turns into a nightmare house and this roof is the big neon warning sign. But there's a much better chance that no major problems are going to develop in the 3(?) months between inspection and closing. Ultimately what you have is a badly installed roof* (maybe - second opinion pending) that hadn't actually caused obvious and serious damage when reviewed in November after 15 years of being up there.

Maybe I'm just more risk tolerant about houses than most people - but I would not lose sleep over this leaky roof.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by dognose » Thu Jan 15, 2015 12:31 pm

Keep in mind that a mortgage "commitment" isn't necessarily real until the lender actually wires the money on your behalf. If you really want to cancel the deal, at the very least you could contact your tentative mortgage provider and inform them of the roof situation. The lender might well regard this as new, updated and potentially material information that could affect your loan commitment (especially these days, with mortgage commitments being much more difficult to obtain).

However, it does sound like a decision has been made in this case. The OP appears to really want the house, and is at least going into the deal with eyes wide open.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Watty » Thu Jan 15, 2015 12:35 pm

ChupaChups wrote:All this was done during the inspection period and when we approached Sellers about fixing the roof (among other items), they gave us a few thousand dollars off of the contract price and basically told us take it or leave it. We like the house and while we were disappointed that we would have to pay for a new roof on top of what we were paying for the house, we decided to take it.


There are two issues, the cost of replacing the roof and any other possible damage.

For the cost of the roof their response was probably reasonable since the house was priced with having an old roof. The 15 year old roof that might have been expected to have a 20 year life or have another five years left on it. 5/20 =25% so the reducing the price by around 25% of the roof price might be reasonable. A lot really depends on how the house is priced compared to other houses in the area.

On finding other damage one option would be to have your inspector come with you for the walkthrough.

One positive is that it is not so bad the mortgage company refused to make the loan on the house while the roof is in the current condition.

It sounds like it is too late now but one way to have handled it would have been to rework the deal so that they put on a new roof and to have agreed to a higher price. I did that when I bought by first house and I did not have enough to pay for a new roof.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by batpot » Thu Jan 15, 2015 12:53 pm

Coworker recently went through this on a long-standing foreclosure. The house needed a new roof; there were massive leaks and water damage.

His first lender initially said financing would be no problem, but when it came to underwriting, couldn't complete the deal due to the leaky roof.
This left him struggling to find another lender who could act quickly, so as not to lose his earnest money, and he ended up having to put the cost of a new roof into escrow, and have the roof work completed before closing.
Huge risk on his part, in that he was putting up ~$15 or $20k for a house he didn't even have a legal right to yet, but it went well.

Now he's dealing with all the other issues of a foreclosed house and deferred maintenance. One notable issue was a disconnected sewer line form the upstairs bathroom...there was a large pile of...raw sewage under the stairs that had to be dealt with. :!: This was missed in the inspection.
It's a huge headache, but he went in knowing it would be, and he has the potential to nearly the double the value.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Busting Myths » Thu Jan 15, 2015 8:36 pm

leonard wrote:
ChupaChups wrote:They should not be able to keep your 10% deposit (I assume earnest money?). Also, if they aren't willing to spend the extra to fix the situation - they won't want to spend money on a lawyer to defend themselves in this situation. Which is what you should do if there is any problem getting out of this deal.

Why exactly do the opinions (that you solicited btw) saying "walk away" not hold merit?

Sounds like OP waived the home inspection contingency when they agreed to the roof discount. Once you waive all contingencies, deposits go "hard" which means they keep the money if you back out. How do you figure the OP has a case against the seller? OP and seller came to an agreement and now OP would be breaking said agreement if they try and back out.

Re: walk away not hold merit.
I think there were only two sound posts on this thread. Everyone else just panicked and assume worst case scenario. This forum is quick to assume the worst but never assigned a realistic probability to that worst case scenario.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by choices » Thu Jan 15, 2015 9:09 pm

IMO that roof is the least of your problems. Where do,you think the water went? I agree that the leaky roof suggests that other maintenance has been neglected. My guess is that if the owners could not afford to repair the roof there are other issues. You will lose your earnest money, but so be it. A new to you house ALWAYS costs money early on. I would rather pay for paint and window treatments and carpet than tear down ceilings and walls and wonder about electrical,problems.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by leonard » Mon Jan 26, 2015 6:58 pm

Busting Myths wrote:
leonard wrote:
ChupaChups wrote:They should not be able to keep your 10% deposit (I assume earnest money?). Also, if they aren't willing to spend the extra to fix the situation - they won't want to spend money on a lawyer to defend themselves in this situation. Which is what you should do if there is any problem getting out of this deal.

Why exactly do the opinions (that you solicited btw) saying "walk away" not hold merit?

Sounds like OP waived the home inspection contingency when they agreed to the roof discount. Once you waive all contingencies, deposits go "hard" which means they keep the money if you back out. How do you figure the OP has a case against the seller? OP and seller came to an agreement and now OP would be breaking said agreement if they try and back out.

Re: walk away not hold merit.
I think there were only two sound posts on this thread. Everyone else just panicked and assume worst case scenario. This forum is quick to assume the worst but never assigned a realistic probability to that worst case scenario.


The OP took a concession from the seller toward the roof being fixed. I didn't see anywhere that the OP took compensation toward DAMAGE CAUSED by the leaky roof. Nor, did I see the OP say they waived any rights toward damage caused by the leaky roof.

Compensation to fix a leaky roof (and waiving of rights) is different than compensation for actual damage due to the leaky roof.

I'd back out of the deal and get my earnest money. If the seller refused, I'd hire a lawyer.
Leonard | | Market Timing: Do you seriously think you can predict the future? What else do the voices tell you? | | If employees weren't taking jobs with bad 401k's, bad 401k's wouldn't exist.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by miles monroe » Mon Jan 26, 2015 10:38 pm

10% earnest money? wow....

is that normal? last 2 offers i made on a house i put down 1%.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by sesq » Tue Jan 27, 2015 11:11 am

The first time I tried to buy a house, I thought I was a big-shot and made what I hoped was a strong offer and put 5% down as earnest money, nearly 20k. We did the inspection and nothing major popped. We arranged for our mortgage and went on vacation. While on vacation the mortgage contingency date passed quietly. A week later the the mortgage company contacted us and let us know the property was in a flood zone and we'd need to buy flood insurance to the tune of $2,500 a year. Interest rates were about 5% at the time, and I figured the $2,500 perpetual expense (subject to perhaps a spiking increase as the flood insurance program is a government thing) would support buying a house that was about 8% more. Or, if I was the seller I'd need to discount my price for the flood insurance cost by at least 8%.

The sellers didn't know about the flood insurance issue, it wasn't caught when they built (only a tiny corner of the garage crossed the line). We kicked up a notch and pulled some more records and found out that 40% of the property was protected wetlands (which was not disclosed, which I am sure they knew about since they had an architect in to do plans for an addition they decided not to do).

We backed out of the deal. A few months later we chopped the deposit due to basically the hazards of litigation (they had a brother who would defend them for free, our lawyer charged an hourly rate). The seller did pretty well, in that they sold for 10k less, or the same price when you consider they kept 10k of our earnest money. Their buyer did much worse in that they sold for about 50K below our offer a few years later (they bought in 2004 and the sold in a down market around 2010 or so, so how much was the flood zone and how much was the market, who knows).

I learned my lesson, and I keep the earnest money low now-a-days.

In the OP's case, I am not sure I would have accepted the small discount, but unlike my flood zone & wetland issue, a roof can be fixed. I can see why they would choose to stick with it.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by dolphinsaremammals » Tue Jan 27, 2015 11:49 am

An experienced seller may not accept low earnest money. I know I would not. If the buyer backs out for no good reason, the seller can be stuck with costs for renting etc. in expectation that the sale will go through once the deadlines have passed, loss of time on the market and so forth.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by kithwang » Tue Jan 27, 2015 12:26 pm

I have a 2000 sq roof that needs replacing. The quotes were 9K, 14K, and 15K. I can't do work now even if I want to. Best to have 38 degrees or higher temperature for 3 days with no rain, snow and high winds.

Did you buy this house for a steal? Do you have extra 30K in case unexpected things come up? If yes to both of those questions, I would continue. If not, I would walk away.

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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Busting Myths » Tue Jan 27, 2015 1:11 pm

leonard wrote:
Busting Myths wrote:
leonard wrote:
ChupaChups wrote:They should not be able to keep your 10% deposit (I assume earnest money?). Also, if they aren't willing to spend the extra to fix the situation - they won't want to spend money on a lawyer to defend themselves in this situation. Which is what you should do if there is any problem getting out of this deal.

Why exactly do the opinions (that you solicited btw) saying "walk away" not hold merit?

Sounds like OP waived the home inspection contingency when they agreed to the roof discount. Once you waive all contingencies, deposits go "hard" which means they keep the money if you back out. How do you figure the OP has a case against the seller? OP and seller came to an agreement and now OP would be breaking said agreement if they try and back out.

Re: walk away not hold merit.
I think there were only two sound posts on this thread. Everyone else just panicked and assume worst case scenario. This forum is quick to assume the worst but never assigned a realistic probability to that worst case scenario.


The OP took a concession from the seller toward the roof being fixed. I didn't see anywhere that the OP took compensation toward DAMAGE CAUSED by the leaky roof. Nor, did I see the OP say they waived any rights toward damage caused by the leaky roof.

Compensation to fix a leaky roof (and waiving of rights) is different than compensation for actual damage due to the leaky roof.

I'd back out of the deal and get my earnest money. If the seller refused, I'd hire a lawyer.

Your right, the OP did not explicitly state they waived the home inspection contingency or any rights for damaged caused after the OP had the property inspected. However, it is common to waive the home inspection contingency in order for all parties to move forward with the close of escrow. Again, once all contingencies are waived the deposit goes "hard" which means you can no longer back out of a deal unless some material change has occurred (i.e. additional damage since the property was inspected). The seller's attorney and OP's attorney has already stated that proving additional damages would be difficult.

ChupaChups wrote:We proposed to the Sellers that we would pay to patch the roof but their attorney rejected our proposal because of "liability" reasons. We have the right of the walk-through on the day of closing and my attorney told us that Sellers have to keep the house in the same condition as the day our inspector saw the house, meaning if there were leaks back then, then our accepting their few thousand dollars meant we could not force them to fix it. But if the damage was exacerbated, then it's up to us to "prove" that the damage was not there on inspection day. The inspector took pictures so I am hoping to get them from him but obviously they will not be of every wall and ceiling so I fear this is going to be fight.


ChupaChups wrote:The attorney who is representing us basically says it's going to be a fight if there is additional damage from the time of the inspection to closing. I am trying to get the pictures that my home inspector took the day of the inspection as reference points. We could ask Sellers to fix any additional damage and delay closing but that would not be prudent on our part being that our mortgage rate lock is good until a short time after the scheduled closing date.

If the OP can afford to lose the deposit, then walk. If the deposit is significant to the OP, then fighting it may turn costly.

claudia
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by claudia » Tue Jan 27, 2015 1:19 pm

Walk away! The issue is not only the roof, but also the existing damage done inside the dry walls. You don't want to regret one day.
C

leonard
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by leonard » Tue Jan 27, 2015 1:21 pm

Busting Myths wrote:
leonard wrote:
Busting Myths wrote:
leonard wrote:
ChupaChups wrote:They should not be able to keep your 10% deposit (I assume earnest money?). Also, if they aren't willing to spend the extra to fix the situation - they won't want to spend money on a lawyer to defend themselves in this situation. Which is what you should do if there is any problem getting out of this deal.

Why exactly do the opinions (that you solicited btw) saying "walk away" not hold merit?

Sounds like OP waived the home inspection contingency when they agreed to the roof discount. Once you waive all contingencies, deposits go "hard" which means they keep the money if you back out. How do you figure the OP has a case against the seller? OP and seller came to an agreement and now OP would be breaking said agreement if they try and back out.

Re: walk away not hold merit.
I think there were only two sound posts on this thread. Everyone else just panicked and assume worst case scenario. This forum is quick to assume the worst but never assigned a realistic probability to that worst case scenario.


The OP took a concession from the seller toward the roof being fixed. I didn't see anywhere that the OP took compensation toward DAMAGE CAUSED by the leaky roof. Nor, did I see the OP say they waived any rights toward damage caused by the leaky roof.

Compensation to fix a leaky roof (and waiving of rights) is different than compensation for actual damage due to the leaky roof.

I'd back out of the deal and get my earnest money. If the seller refused, I'd hire a lawyer.

Your right, the OP did not explicitly state they waived the home inspection contingency or any rights for damaged caused after the OP had the property inspected. However, it is common to waive the home inspection contingency in order for all parties to move forward with the close of escrow. Again, once all contingencies are waived the deposit goes "hard" which means you can no longer back out of a deal unless some material change has occurred (i.e. additional damage since the property was inspected). The seller's attorney and OP's attorney has already stated that proving additional damages would be difficult.


So, your giving advice based on assuming they lose the deposit? Why not just assume the opposite? Or, make no assumption and deal with the facts as we actually know them.

Once the OP has an attorney fully engaged with the other party and filing a suit, I'll bet wiggle room starts to appear.

Also, if the OP makes it clear that they will do whatever it takes, for as long as it takes - the seller will likely offer to cover the damage or refund the earnest money. They likely do not want to do the upkeep and financial maintenance on this property. So, the OP could make it clear that the sellers most expedient move would be to refund the earnest money and move on to the next buyer.
Leonard | | Market Timing: Do you seriously think you can predict the future? What else do the voices tell you? | | If employees weren't taking jobs with bad 401k's, bad 401k's wouldn't exist.

Busting Myths
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Re: Sellers Won't Fix Leaking Roof; Fear of Additional Damag

Post by Busting Myths » Tue Jan 27, 2015 4:29 pm

leonard wrote:So, your giving advice based on assuming they lose the deposit? Why not just assume the opposite? Or, make no assumption and deal with the facts as we actually know them.

Once the OP has an attorney fully engaged with the other party and filing a suit, I'll bet wiggle room starts to appear.

Also, if the OP makes it clear that they will do whatever it takes, for as long as it takes - the seller will likely offer to cover the damage or refund the earnest money. They likely do not want to do the upkeep and financial maintenance on this property. So, the OP could make it clear that the sellers most expedient move would be to refund the earnest money and move on to the next buyer.

First, my original post was 1) a comment as to why the OP may not be able to walk way and 2) a question posed to you as to how you figured they could walk away.

Second, my comments were based on the OP's statements, as quoted in my previous replies, and my experience in selling Bank Owned REO. Once you agree to a concession on a repair (either do the repair or reduce the price) you require the buyer to waive inspection contingency so that they cannot bring up this/related issue down the road. Now, I do not know if the OP has waived their inspection contingency, but based on how real estate is normally sold then it is safe assumption that they did. If you have a statement from the OP stating they have not waived their inspection contingency then please point it out to me and I will apologize for not seeing it. Now going back to my previous posts...

Once you waive contingencies (typical scenario) deposits go hard and the only way to get your money back is because of some material change in the property prior to closing. UNLESS the OP can prove that damage has occurred to the home (because of the roof leak) after the inspection contingency was waived, but prior to closing, their does not appear to be a material change in the condition of the property in order to cancel the sale and get their deposit back.

Your advice was to proceed with litigation. Can you litigate? Sure. An attorney will represent you as long as you compensate them for their time but based on the OP's statements they are dealing from a position of weakness. The success of negotiating with a seller is the amount of the deposit and likelihood of the seller losing if it goes to court. OP put down 10% of the purchase price and cannot prove additional damage has occurred. Losing a small deposit and having to find a new buyer is a big enough headache where a seller may concede to get the deal done. Having a large deposit means a Seller can afford to have a Buyer walk away as they have been compensated for finding a new buyer.

My point about the difficulty in proving additional damage came from the OP's attorney (not my opinion). If you are an experience RE attorney and/or have dealt with this issue several times then by all means I would encourage the OP to take your advice.

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