The Poor House

New builder finished his forensics work on the new house. He says it's roughly 1/3 complete, with about 1/3 of the construction loan's worth of work done (which, coincidentally, just about totals the amount of the liens that the former subs have put on us). That's not awesome because there's only 1/3 of the construction loan left.

Also, he says the original builder grossly under-estimated the cost of the house, so we were on track to be stuck with a big bill at the end, no matter what. Also there are multiple outright code violations and a few questionable spots.

As it stands now, we simply don't have the funds to finish the house. Chopping it way back to the minimum possible to be called a livable house wouldn't be enough to get it into our budget (and then we'd have a really expensive but kindof crappy house). And the new builder is reluctant to start without a sizable down-payment, which we don't have.

We have no idea what we're going to do.

On the bright side, it's looking like the old builder may become the subject of a State Bureau of Investigation investigation. If he's convicted, there might be a chance we could declare our losses as theft or fraud. That could help with taxes, eventually.

9 thoughts on “The Poor House

    1. cleek Post author

      i don’t think there’s much of a market for 1/3 houses.

      i think we’d have to demolish what’s there and then sell the land, if we were to go that route. but i think demo would cost a small fortune.

  1. mark

    Yeah, I don’t know. I think if you made it your full time job to figure out what state statute was violated by your agreement with the previous builder (did he forget to file something? everything?) then you might be able to use that to weaken the argument that you are responsible for the bank loan. That’s a very NYC-centric way of looking at it – because there’s always a piece of paperwork that someone forgot to file at some obscure city agency, which you can use to backdate the negligence to the outset of your agreement. It’s also really easy to look up cases and violations by companies/individuals. Any way that you could prove that the builder was negligent even before the bank loan was signed might give you leverage against the subs as well. Extremely tricky territory. Is it feasible for you to figure out what is required to be a builder, and see if he had made any missteps in the relationship prior to any signing on your part?

    Obviously riding it out and seeing what the fraud angle gets you in tax savings is the safest way to go. I’m not advocating your going up against the bank in a long, drawn-out court case. From reading only this blog, it seems like you should simply be collecting evidence against the builder to shore you up against the bank’s or the subs’ future claims, whatever they might be. And I can imagine that they will get pretty creative and/or desperate as time goes on.

    I can bring a screwdriver down one weekend if you need help demolishing that thing. It sounds like a lot of unscrewing, literally and figuratively.

  2. Sharon Barrett

    Cleek, so sorry to hear of all this horrible trouble you’re having. Just popped by to say you were mentioned and missed on Balloon Juice. I hope they nail that guy for fraud and you can someday get released from the loan.

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