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Matchboxx

[TX] [Real Estate] Issue with home that may not have been disclosed

I recently bought a home in Texas and, while previous foundation work was disclosed and accompanied with a warranty, the paperwork only indicated an issue with the foundation on the southwest portion of the home.

6 months later, we recently observed that the foundation is now failing in the center of the home likely due to a cracked cast iron sewer pipe under the slab. The repairs come at an estimate of $25,000. Homeowners insurance will not cover because cast iron pipes have expiration dates, and this is considered normal wear and tear.

However, a foundation expert who came by the home found evidence that the sellers may have covered up early signs of this, such that the issue wouldn't be obvious to the home inspector. If they were aware, they should have put it on their disclosures, and they did not. Unfortunately, my very rough understanding of TX real estate law is that you buy all the homes "as-is" (since our inspection was done during this weird "option period" as opposed to a normal inspection contingency clause).

Is my assessment correct, and we're screwed? I'm also not sure how their foreknowledge could be proven. To play devil's advocate, the sellers didn't seem to be the wisest at home maintenance (we've had to gut some of their DIY work), so I honestly don't know if there was intent behind the cover-up, or if they just didn't know what they were doing.

What are our options? We do not have $25K liquid to pay for the repairs, nor enough equity yet to take out a second lien, but my house is starting to look like the set from Beetlejuice.

Posted Mar 12, 2018, 9:33 PM UTC

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