Gullible's Travels: Declined Claims

Real Estate Broker/Owner with Providence Group Realty TREC# 0608931

Sometimes a roof can naturally reach its end of  life. Texas heat can also work to prematurely age a roof when a home's attic area lacks sufficient ventilation. Intensely high temperatures can literally "cook" a roof from the inside out, and will often show up in the form of a "blister" or granulated shingles, which is often mistaken by many homeowners (and even some home inspectors) as hail damage.

Last week, we received the following letter as part of a Seller's Disclosure package. The letter noted that the homeowner filed a claim for roof replacement in October of 2014, which was subsequently declined. Whatever damage existed was simply not covered under the homeowner's insurance policy.



While the Seller's action to include this letter as part of the disclosure package was honorable, her listing Broker's actions didn't quite measure up. Upon receipt, we pointedly asked if a new roof was needed. The response that followed... "See report from State Farm. It's not stating that it needs a new roof."

While that actual statement may have been true, the representation behind that statement belongs in the Hall of Shame. The listing agent appeared to be attempting to pass off a declined insurance claim as a clear roof report! (If nothing was wrong with the roof, why did the Seller file a claim to begin with?)

Buyers and Buyer's Agents 

must guard themselves carefully against misinformation and deceptive trade practices, whether committed intentionally or unintentionally by Sellers or their Agents.

One protection step Buyers can take is to ask a Seller to provide a CLUE report. CLUE is an acronym for "Comprehensive Loss Underwriting Exchange" -- the name for the database where insurance claims are housed. A CLUE report must be either ordered or authorized by the homeowner. It will show all claims made against the property for the past 5 years.

The only thing that is WORSE than a listing agent attempting to misrepresent property condition as "passing" is a Seller who has in the past successfully filed a claim and then pocketed the insurance money without completing the repair for which the money was awarded. This can be a deal killer, as a Buyer will be very unlikely to obtain financing approval based on property condition (it will almost certainly be uninsurable) if the Seller is unable to care for the offending condition prior to closing.

Buyers must be smart! Hiring the right representation to assist you in navigating the buying process will help you avoid unnessary expenditures and wasted time from engaging in a transaction that has little to no chance of closing.  If you are buying or selling real estate in the DFW Metroplex or surrounding areas and want the benefit of quality representation, give us a call at 469.645.6363. Or, visit us online at We would love to assist you with your real estate goals and protect your best interests in the process.


Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. John DL Arendsen 05/08/2015 03:30 AM
  2. Ginger Harper 05/10/2015 12:00 PM
Home Buying
Texas Collin County Plano
What's Got Your Goat?
Texas Independent Broker Network
Dallas, TX Real Estate Professionals
Collin County, TX Real Estate Professionals
deceptive trade practices
warning signs
roof replacement
hail damage
deal killers

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Show All Comments
Nina Hollander
Coldwell Banker Realty - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

I love those clue reports; they can be very helpful. Roofing issues, I've learned, can be very complicated and you need to really stay on top of inspectors, adjustors, etc. I sold a home a few years back where the sellers were turned down 3 times for a replacement. By the time the buyer's agent and I got through with inspections, adjustors, they revised their ruling and replaced the entire roof.

May 06, 2015 10:18 PM #9
Lenn Harley
Lenn Harley,, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Unfortunately, many home owners don't realize that, if they make several claims to their home owner's policy, it will follow them to a new location and their premiums can skyrocket.

May 06, 2015 11:15 PM #10
Paula McDonald, Ph.D.
Beam & Branch Realty - Granbury, TX
Granbury, TX 936-203-0279

Great post and we here in my area of south Texas did experience some major hail a few weeks ago.  The sad thing is that there are many roofing scams out there that have homeowners scratching their head about whom to believe.

May 06, 2015 11:19 PM #11
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

I once worked for a guy who made enough claims each year to pay for his insurance premiums plus get a little rate of return on the premiums too. The systems are innocent and with all things.... the ones that abuse them are guilty

May 06, 2015 11:44 PM #12
Nicole Doty - Gilbert Real Estate Expert
Zion Realty - Gilbert, AZ
Broker/Owner of Zion Realty

It doesn't hail often here but the heat sure can do damage to the underlayment of roofs below the tiles which usually only last about 10 years before it should be stripped and replaced. 

May 07, 2015 01:05 AM #13
James (Jim) Lawson, DBA LLC - Bonita Springs, FL
Broker Associate, RSPS, BPOR, HI & PE

In situations like this, as a buyers agent, I recommend that my buyer hire an independent roof inspector to assess the material condition and installation features of the roof as they affect functionality and longevity. In addition, I want a professional opinion of the range of useful life left of the existing roofing system. Also, if a repair is warranted, an estimate of the cost of the repair should be included in the report. Just make sure that the inspector you select has a reputation for telling it how it is and  is not associated with any roofing company. This expert should be highly knowledgeable of both roofing materials and installation practices. With this report in hand you can review the purchase contract and try to renegotiate the price, if necessary.    

May 07, 2015 11:24 AM #14
Jon Quist
Tucson's BUYERS ONLY Realtor since 1996

Fortunately in Arizona a CLUE report is a requirement as part of the contract process. And if you want HOT when it comes to a roof, come to Tucson. We'll show you hot!

May 07, 2015 11:47 PM #15
Adele Langdon
Los Angeles, CA
Exclusive Realty Inc.

Thanks Amanda as others have said your cartoon says it all. Glad your client had you for their realtor!

May 08, 2015 12:23 AM #16
M.C. Dwyer
Century 21 Showcase REALTORs - Felton, CA
MC Dwyer-Santa Cruz Mountains Property Specialist

Congratulations on the Featured Post Amanda!   Well deserved with a catchy title, thought provoking content, plus your own cartoon.     Another reminder that all agents are not equal...sigh.

May 08, 2015 01:48 AM #17
Janelle Ancillotti
Seneca Home Staging - Syracuse, NY
HSR Certified Home Stager, Syracuse, NY

Sounds like they were trying to pull a fast one, or they were just acting dumb. For anyone who is interested in a fantastic roofing material that exceeds UL2218 Class 4 hail test requirements and also Miami-Dade BCCO requirements, check out CopperPlus or their blog Copperology.

May 08, 2015 03:18 AM #18
John DL Arendsen
Crest Backyard Homes "ADU" dealer & Contractor

As a General Contractor we used to do roofs all the time. Can't believe how burnt and charcoald the sub straight (wood sheathing) would get under those shingles. It actually looked like they had literally burned. I can't imagine how they didn't catch on fire.

May 08, 2015 03:24 AM #19
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

Yes, this agent and the homeowner were trying to wiggle out. But this story points up the importance of reading the fine print on your insurance coverage. 

May 08, 2015 03:33 AM #20
Sharon Parisi
United Real Estate Dallas - Dallas, TX
Dallas Homes

Amanda Thomas    North Texas home owners need to have their roofs inspected by reputable roofers on a regular basis and understand that they need to pay for many repairs out of pocket.  The hail in your friend's photo is incredible! 

Is there any way you can make it for the Dallas area AR meet up on the 14th?


May 08, 2015 06:11 AM #21
Amanda Thomas
Providence Group Realty - Plano, TX
​Broker, SRES®, BPOR, MCNE, ​Certified DRS Agent™

Sharon Parisi , thank you for bringing the meet up to my attention. It looks fun! 

May 08, 2015 07:38 AM #22
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Oh my goodness!  A declined insurance claim is definitely not a roof certification or clearance.

Love the title, "Gullible's Travels."

May 08, 2015 01:31 PM #23
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

Depending on the information listed on the TDS, securing a CLUE report might be appropriate. Regardless, a great post of useful information.

May 08, 2015 05:56 PM #24
Evelyn Johnston
Friends & Neighbors Real Estate - Elkhart, IN
The People You Know, Like and Trust!

Why in the world would a buyers agent ask the listing agent if the roof needs to be replaced?  They work fo the seller! Hire a roofer to do an inspection!

May 09, 2015 01:14 PM #26
Amanda Thomas
Providence Group Realty - Plano, TX
​Broker, SRES®, BPOR, MCNE, ​Certified DRS Agent™

Evelyn Johnston, in Texas, Sellers and their Realtors® have a duty to disclose knowledge of property condition. Why would a buyer's agent waste a Buyer's time showing a property that won't be suitable for a Buyer's financing type on a Seller who can neither afford (or isn't willing to) fix a bad roof -- when insurance has already declined payment?  

Why NOT ask first? There is no excuse for not receiving an honest answer. "I don't know" would have been a far more appropriate response than the deceptive scat this yahoo tried to pander. In this instance, knowing we had -- at best -- an agent on the other side that had questionable ethics was all we needed to know.  Asking questions is an excellent discovery tool. :-)

May 09, 2015 11:03 PM #27
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Wow - a fancy side step from that agent.  When we represent sellers, we need to be impartial and not take their actions into our business ethics!

May 10, 2015 11:23 AM #28
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

You are so right.  Just because and insurance claims is denied does not mean the there is no damage.  It means there is no covered damage.   Sometimes an insurance company will have a detailed roof inspection as part of the claim investigation,  that might be of help.

May 11, 2015 07:11 AM #29
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Amanda Thomas

​Broker, SRES®, BPOR, MCNE, ​Certified DRS Agent™
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