Our offer on a bank-owned property in our fabulous island city of Alameda CA was accepted.
In the course of our buyer investigation period, we discovered that there was extensive work done, but the only permit pulled was for the roof.
So what was done and by whom?
We were surprised at how much work was actually done. Worse, it appears there was serious mold issues. The contractor selected by the REO bank, was also a mold inspector and remediator and he supposedly took care of this.
When asked where are the permits to the extensive work they did, the contractor's representative carefully explained that the bank told them "not to worry about getting permits for the other work because when the city gets involved, a $50K job could turn into $100K."
They removed and replaced walls. Installed new windows. Wired new electric. Replaced the bath tub, sink and commode. Installed replacement appliances. Installed new furnace. All without permits!
My client, who is a construction inspector decided to back out. As good as the deal seemed to be, it just didn't feel right that several of the major work was done without permits, licensed contractor or not. As far as we were concerned, the contractor should have known better.
Why should one get a permit?
In Alameda, not having permits is almost akin to putting a sign that says the house is not for sale.
"Not only does a permit ensure the work is done correctly and to code, you will also avoid the pitfalls of failing to obtain a permit.
Among the downsides of failure to obtain a permit prior to starting work are increased fees (four times the normal permit fees), the possibility the work is unsafe and hazardous, the possibility that the work does not meet code and will have to be repaired or removed, and the requirement that you disclose illegal construction when you go to sell your home.
Obtaining a permit is the law, and it is also a good idea."