Four steps to handle a broken trust

Reader Question: We have a broken trust. We bought our first home last month. Our inspector found several problems, one of which was a rodent problem in our attic. We trusted our agent when she told us the rodent problem was taken care of when they fixed the roof. We did not know what to look for on our final walk through. Everything appeared to be okay for a month. Then, we had an ant problem, and the extermination service included a general pest inspection. They found an active rat infestation and many entry points. We don’t think we should have to pay for this expensive problem. However, is it our fault that we did not follow up with the first inspector? Our real estate agent is new and doesn’t know what to do. Who should we contact?

Monty’s Answer: Every state has different laws and rules, and the answers may be in the paperwork you signed during the home buying process. Whether you have liability at all may be questionable. Liability may rest with the broker, the agent, or the seller, or it could also be all three of them.

It is human nature to trust

As far as your agent being new, being new is not an acceptable excuse for this situation. Trusting is more likely to occur with a relative or friend. There is an old quote, “Trust, but verify.” It applies in all facets of life, not just real estate. If someone told your agent, the problem was solved, and like you, they did not verify. By the very nature of the real estate license, the consumer can expect a unique expertise to provide the service. “Verifying” is an important part of the agent’s job.

At the final walk through, you should be seeking evidence all the items the inspector discovered were properly corrected. In the case of a rodent problem, which is not readily visible, you should have been furnished a paid receipt with a description of what work was completed to remedy the problem. Verifying that the condition of the home has not changed since you last visited the property is the other purpose of the walk through.

Consider these four steps

  1. Gather up all your paperwork in one file. Include the inspection report, the purchase agreement and any amendments, the seller condition report (many states require the seller to complete one), and any other notes, photos or information that may be pertinent.
  2. Call your agent’s real estate company and ask to speak with the owner or the designated broker. Make an appointment to meet with them and explain what took place. Tell the broker you expect they will cover the cost of the work. They may offer to take care of the problem, say they want to review the transaction with the agent or say there is nothing they can do. They may even refuse to meet with you. If a meeting takes place, keep notes on the conversation.
  3. A good real estate attorney’s read on where the liability rests may be helpful. The pest control cost may not be enough to litigate, but an educated opinion is useful information. Before you schedule an appointment, describes what happened in your words to accompany the paperwork in a one-page document. A paper to read will save the attorney time. You are hiring the attorney solely to give you an opinion. If you do not have an attorney, here is an article to give you some pointers on how to find a good real estate attorney.
  4. Once you have met with the attorney, you will have a much clearer picture of what to do next. If the lawyer says you have a strong case, then go back to the real estate company and ask for the money to right the error. Consider asking the attorney what they would charge to create a demand letter as their ask may be more effective than your personal request.

If the real estate company remains uncooperative, you have some choices:

  • Chalk it up to experience and take your lumps.
  • Invite them to mediation for the solution.
  • File a formal complaint with the state department of regulation and licensing.
  • Go to small claims court, with guidance from the attorney.
  • Go to small claims court on your own.

The best solution will become apparent as you take these steps. It is possible the answer will appear very early.