The house is crumbling

**Tiajean** · 04-23-2008, 10:12 AM

Some major advice needed from those of you that know about insurance companies, old homes, bad foundation, and frugality!
When DH bought this house, I was not in the picture. It was his grandfather's house, owned by his mom and aunt, empty for many years and not taken care of. From what I understand, DH was in a heck of a crunch and needed a house fast. Mom and aunt offered him the house at an affordable price and he got a balloon loan for it because his credit was not good enough to get a regular mortgage (I was not in the picture back then, remember... we wouldn't of bought this place had I been!). Since then, his balloon was up and he had to get another balloon loan (again, I wasn't here, it ends in less than two years and there WILL NOT be another one!). Well, DH did some cosmetic work on the house, but never ever looked into anything else. Why? Because he doesn't like doing that work so he just repairs as needed. You CANNOT do this to a home that's over 100 years old!

I guess this turned into a bit of a vent, sorry. He doesn't seem to understand where I come from wanting to improve the place.

SO, I move in and start cleaning the ton of useless (and mostly broken) stuff he and his ex-wife hoarded over their marriage along with stuff that was never moved out when he's grandparents lived there. How could a proper initial inspection of the house have been done if all this stuff was already there, I think a proper one wasn't done!
Here's a kicker, DH's brother was a contractor and built houses. DH NEVER had him look at the place. Under the house, we have half that is a basement and half that is a crawl space (under the living room). it is just dirt floor and cement blocks. So, I ask DH's brother to look at the crawl space to see if we could dig all that dirt out and maybe make an addition to the basement and have it bigger down there. He looks at it and tells me to paint everything white and put the house up for sale as the foundation is crumbling and in really bad shape. Here's a funny thing, I talk to DH about it and he says "How can it be that bad? The house has been up and standing for over 100 years, it's fine." I advised him that the house has had over 100 years to kill it's foundation too. DH has checked with a friend this winter and they said that the house can be jacked up and the old foundation pulled out and new foundation put in. This is going to cost a nice chunk of money we don't have. DH said that he's going to try and claim it on the insurance but I don't think they are going to cover it as they will say it was preexisting before he got the insurance. We actually fought over this and he says that the insurance should cover anything that happens to the house.

I guess I wanted to ask everyone here about this before we start calling the insurance company and them possibly pulling our insurance on us because of the problems with the house. We have to fix the foundation as all the houses around here were built so close together that we can't get any type of permits to rebuild or anything.

Any type of advice/help/information is greatly appreciated!!!!

**Dancing Lotus** · 04-23-2008, 10:22 AM

I think it depends on how long he has had the insurance policy. It it been yrs and yrs then they can't say it preexisting .

**Pianolady** · 04-23-2008, 10:49 AM

I'm not a professional, but have had a lot of experience buying houses that need help and fixing them up. Of course, these things may/may not apply to your situation, but have been my experiences.

I doubt insurance will cover anything that should have been normal maintenance, pre-existing or not. I'd have a good talk with your agent before trying to file a claim.

Selling the house may be an option, but you can't hide the fact the foundation is crumbling when selling. The house inspection will show it anyway, so you'd be better off being honest up front.

Another option might be to find out how much it would be to fix, and possibly refinance the house with the additional funds to fix the problem, or get a 2nd mortgage. Refinancing into a fixed rate loan would be a good idea with the rates so low right now. Depending on the house's assessed value, this may be doable, and certainly worth looking into. Sounds like you might have to co-sign on the loan to get the best fixed rate though, that's something you'd have to consider before jumping in. Don't look for an FHA loan, you'll have nothing but trouble with a fixer-upper house, look for a conventional mortgage.

**dianne9106** · 04-23-2008, 10:51 AM

Well given the house is 100 year old they may not pay for the replacement foundation. Perhaps you should google it before you start calling the company. They may not take your insurance away - but they could go up on it or make certain exclusions on it because of the foundation

. This is JMO - not professional advice - so I would research it on my own first. I would def get a couple of estimates on how much it would cost to get the foundation fixed - as they really don't last forever without maintenance

Best Wishes!
Dianne

**Tiajean** · 04-23-2008, 01:17 PM

I thought I'd start with you all here about the insurance covering the foundation. I really don't think that they will. We changed insurance companies 2 years ago only, so that probably would not be covered. I will do more research on it also. We are just waiting for all of the snow to melt so we can get someone in to look at the foundation and estimate how much it will cost to fix. I'm hoping it will be minimal and that we can possibly get a regular mortgage with the additional money added onto it.
I could not, in good concience, sell this house the way it is to an unsuspecting buyer. DH's mom and aunt did that to him. The last time we were at her house she had made the comment that the house was already in bad shape when her dad moved out of it years ago, that it spent many many years on the market and that we need to get going on fixing it up if it's not already too late. IF she KNEW it was in this bad of shape when DH needed a house then WHY THE HECK did she sell it to him?!?!?!?! Why would you sell your child a lemon of a house? She knows we don't have a lot of money and shoots down every idea we have to try and fix the problem. Not that she has those things to worry about. She just paid cash for property and to have a brand new custom house built for herself that she just moved into less than a month ago.
Don't get me wrong, I really do love my mother in law, this subject with her just rubs me the wrong way.

**cissylu** · 04-24-2008, 09:09 AM

hug`s you`ve been given good advice .I`m just so sorry this has happened to you. good luck

**banana** · 04-24-2008, 10:40 AM

wow. I hope when you get someone to look at it that it wont cost you too much to fix.

**FrugalMomof3** · 04-24-2008, 01:26 PM

My suggestion would be to see how much it would cost to jack up the foundation and fix it.

I personally dont believe the insurance company will pay for this but it wouldnt hurt to ask about it, I mean if they cover part that would be great too. Ask them about options that you have.

Wishing you the best of luck and let us know how things turn out

**krissyre** · 04-24-2008, 02:42 PM

I used to work as a claims rep. for an insurance company. I wasn't an adjuster (the guy that goes out to assess how much damage has been done to your home), I just handled small claims. But I know that we would not pay for any kind of maintenance work on a house or property.

Based on your description, it doesn't sound like the damage was done during a storm (although most policies exclude groundwater seepage and flooding, so damage from those types of events wouldn't be covered anyway). In my experience, even attempting to make a claim for this would be a bad idea. Even if your claim is rejected right off the bat when you call, it will still be noted on your policy that you were aware that you had foundation damage back in April 2008, and any other damage to the house that might be caused by the failing foundation would probably not be covered. And if an adjuster came out to inspect the damage, they might actually decide not to renew your policy until you get it fixed.

Insurance is a funny thing. They won't pay one dime to help you get your 20 foot tall rotting oak tree cut down. But they'll pay to fix your house, your neighbor's house, your fence, or your car when the rotted tree finally falls down. They won't pay to get your leaky pipe fixed, but when the pipe bursts and destroys your walls, carpet, and personal belongings, they'll reimburse you for that. They won't pay for a claim if your basement floods because of groundwater seepage (a condition that you can't help, really), but if you fail to close your basement window and water gets in that way, the damage is covered. Such a screwy system.

ON THE OTHER HAND.... I know you said that you didn't think a proper home inspection could have been done because the house was too full of stuff. Did your DH pay to get the inspection, and you don't think it was done properly? Or do you think your DH just didn't have one done? Because if he did have one done, and the inspector said that the foundation was OK, you might have a claim against the inspector.

In any case, HUGS to you! I am sorry you have to deal with this, but hopefully you can get it fixed for less $$ than you think!

**alch** · 04-24-2008, 05:12 PM

I live in a house which is over 100 years old and they are money pits. Something always has to be done to them. Get a loan and fix the problem then sell it.......

**annymoll** · 04-24-2008, 05:28 PM

Call the Historical Society in your area.Ask what you would need to do to put your house on the registerAsk to be put in touch with someone who does home restoration. Give them a call, ask them to come out and give you a bid.

**mikandmari** · 04-27-2008, 07:26 AM

We renovate houses and lived in one through this exact kind of renovation. So I've got a few tips:

1. Your BIL is nuts. Sell a house with fresh paint over a crumbling foundation? aa

**mikandmari** · 04-27-2008, 07:47 AM

My cat jumped on the keyboard! Sorry about that!

1. I'll repeat... your BIL is nuts. If you sell the house with white paint over the crumbling foundation, that's fraud. A slick home inspector will see it anyway, and if not you'll probably find yourself in a lawsuit.

2. Start getting estimates for the repair. The good news is that the housing industry is down, so there are contractors out there needing the work. It's mostly labor, they will slowly jack up the house (so slowly that you won't even feel it, otherwise the plaster walls will crack) and replace the crumbling foundation. It's also important to find out WHY the foundation went bad and repair that, so it doesn't happen again. Was it shoddy construction to being with, or water damage? Also, have you checked for termite damage?

3. The worst part is that you will need a loan, and the repairs won't increase the value of the house, like a loan for a cosmetic improvement would. But the housing market is so bad, that selling it as-is without repairing it may not be an option, or you may not get enough to payoff what you owe. I would get it fixed and just continue living in it. The worst thing you can do is ignore it. Believe me... this happens to people every day. Homeownership isn't all it's cracked up to be!

**Athena31** · 04-27-2008, 03:39 PM

Whatever happens I hope it works out for you all!

**Tiajean** · 04-28-2008, 08:30 AM

First, let me clarify LOL. BIL didn't say to cover the foundation with paint. He just meant to paint the rest of the house neutral(white-blank canvas) to be able to sell it. He never said to not tell about the foundation, just that it's going to cost so much money, it's not worth us trying to fix it.
DH did have a contractor come in and look at the foundation. We are awaiting an estimate. The contractor said it's the worst he's seen ever and that it was very shoddy construction. From what I'm learning, the house was built at two different times and the part that has it's foundation crumbling was actually just built on dirt, there's a dirt floor in the crawl space under that part of the house and the foundation was not done properly in the first place.
The contractor told DH what would need to be done about jacking up the house and rebuilding, etc. We knew the basis of what needs to be done, we just need to know what the cost is going to be approximately.
I don't even know where to begin to find out about termite damage. In all honesty, I don't think DH could handle another blow of bad news about the house. He's honestly about ready to look for another place and let this one go. Which, in all good sense, we cannot do (and I will not allow right now), but he really had no clue how bad of shape it's in. If I had not investigated, he wouldn't be the wiser right now even about the foundation.
For now, we will live in it as is until we find out more about the cost.