Download
Download this document in PDF format »
Legal and Regulatory Problems
- Code Violations:
Unpermitted work likely fails to meet current building, electrical, plumbing, or fire safety codes. - Stop Work or Demolition Orders:
The municipality can issue a stop-work order or require removal of unpermitted structures or systems. - Retroactive Permitting Difficulties:
Obtaining permits after the fact (“as-built” permits) can be time-consuming, costly, and sometimes impossible if work doesn’t meet code. - Municipal Fines and Penalties:
The property owner — not the previous owner — is typically liable for violations and fines. - Title or Zoning Issues:
The unpermitted structure may violate zoning laws (setbacks, use restrictions, lot coverage limits, etc.) and prevent title insurance or certificates of occupancy.
Financial and Insurance Problems
- Reduced Property Value:
Appraisers and buyers often discount homes with undocumented work because of the risk and uncertainty. - Higher Costs for Compliance:
You might have to open walls, upgrade wiring, or replace plumbing to meet current code — at your expense. - Insurance Coverage Denial:
Homeowners insurance may deny claims related to unpermitted work (e.g., fire caused by unapproved electrical wiring). - Difficulty Refinancing or Selling:
Lenders and future buyers may reject or delay transactions until violations are corrected and properly documented. - Ineligible for Certain Loans:
FHA, VA, or other federally backed loans often require proof that all structures and systems are permitted and inspected.
Safety and Structural Problems
- Substandard or Unsafe Construction:
Without inspections, work may have been done by unqualified individuals — risking electrical fires, leaks, mold, or structural failure. - Undetected Hidden Defects:
Hidden wiring, plumbing, or load-bearing modifications could pose long-term hazards or require invasive inspection later. - Increased Liability Risk:
If a guest or future buyer is injured due to faulty work, you could face personal liability.
Disclosure and Transaction Problems
- Failure to Disclose:
Sellers who conceal unpermitted work can be liable for misrepresentation or fraud; however, enforcement is often burdensome for buyers. - Inspection Limitations:
Home inspectors can’t issue permits or open concealed work — meaning many issues may go unnoticed until after purchase. - Unrecorded Additions:
The tax assessor’s records may not reflect actual square footage or additions, leading to discrepancies in property valuation. - Future Resale Headaches:
You may be forced to legalize or remove the unpermitted work before selling, delaying your transaction and lowering resale appeal.
Community and Utility Problems
- Utility Connection Issues:
Certain systems (e.g., HVAC, plumbing, or sewer) may not be legally tied into municipal services without permits. - Impact on Neighboring Properties:
Improper grading, drainage, or expansion could violate setbacks or cause runoff issues, leading to neighbor disputes. - Municipal Record Problems:
Lack of permits means the municipality has no official record of improvements — complicating future renovations or property assessments.
Step-by-Step: How to Research Building Permits
1. Start with the Local Building or Code Enforcement Office
- Contact the township, city, or county building department.
- Ask for the permit history or property record file for the specific address.
- Many municipalities have online permit lookup portals where you can search by address or parcel ID.
- Request copies of:
- Building, electrical, plumbing, mechanical, and zoning permits.
- Inspection reports and final approvals (“finals” or “certificates of completion”).
- Certificates of Occupancy (CO) or Use & Occupancy permits (U&O).
Tip:
If the township or county maintains a property file (paper or electronic), you can often request to view it under public records laws.
2. Compare Records to What You See
- Compare the permit history to the current home’s layout and features:
- Do the square footage, number of bathrooms, or decks/additions match what’s listed on the tax record or old plans?
- If the home has a finished basement, enclosed porch, or second-floor addition with no permit on record, that’s a red flag.
Examples of warning signs:
- Permit history stops before a major remodel date.
- No mechanical or electrical permits for visible upgrades (e.g., new HVAC, wiring, or kitchen layout).
3. Check the Tax Assessor’s Records
- Look at the property assessment card on the county website or tax office.
- It lists square footage, year built, and additions/remodel years.
- If the tax record shows less square footage or older construction dates than reality, there may have been unrecorded (unpermitted) work.
4. Review Past MLS Listings or Real Estate Photos
- Search for older listings on Zillow, Realtor.com, or Redfin.
- Compare past photos and floorplans with current conditions.
- You can often spot added decks, finished basements, or room conversions that weren’t present before.
5. Ask the Seller for Documentation
- Request:
- Copies of all permits and final inspections.
- Invoices or contractor information.
- As-built drawings or plans if available.
- If they claim “the previous owner did it,” that increases your due diligence responsibility.
Tip:
Ask your agent to include a clause in the offer that the seller must disclose any unpermitted work to the best of their knowledge.
6. Consult a Qualified Home Inspector or Engineer
- Hire an inspector experienced with identifying unpermitted or substandard work.
- Ask them specifically to note:
- Electrical panels, framing modifications, plumbing reroutes, and HVAC systems that appear newer than the rest of the home.
- Evidence of concealed or incomplete work.
7. Check Utility Company or Contractor Records
- Sometimes, utilities or contractors must file notifications (e.g., for new HVAC or water heaters).
- Ask if the HVAC, electrical, or plumbing contractor pulled permits — reputable ones usually keep copies.
8. Ask the Township About “After-the-Fact” Permits
- If you find unpermitted work, ask the building department:
- Whether you can apply for retroactive permits (“as-built” permits).
- What documentation or inspections would be required.
- Whether penalties or modifications would apply.
Tip:
Some municipalities allow a “field verification” inspection to legalize existing work — but only if it meets current code.
9. Involve Your Title Company or Real Estate Attorney
- Title searches won’t always show unpermitted work, but:
- An attorney can review local ordinances for potential fines or enforcement.
- They can also ensure your purchase contract includes appropriate disclosure and indemnity language to protect you.
10. Weigh the Findings
If you discover unpermitted work:
- Estimate correction costs (e.g., tearing down a deck or opening walls for inspection).
- Negotiate with the seller to:
- Obtain retroactive permits before closing,
- Provide credits or price reductions, or
- Escrow funds to cover future compliance work.