Expert: Dick Dennis - 6/10/2008

Question
i bought a condo 2 1/2 yrs ago, and in the sale their was no mention of a construction defect in regard to water damage. now our condo has been red tagged and our hoa's solution is to fix it. fixing it is going to cost me 40,000, im maxed out with 3 loans and no one will give me a loan. this was my first home purchase. If i dont come up with 40,000 in 30days they, the hoa will foreclose on my house. do i have any options??? ive talked with several attys and they all say "walk away" foreclose. im worried about the tax liability and my future ability to obtain a mortgage. what do you suggest i do.

Answer
While I agree with the attorney (I hope it was a real estate attorney), there should have been a report of an inspection of the property at the time you bought the property, Allisson.

Other than that, very simply go to the head of the lender's foreclosure department and tell them that you have a $40,000 defect and that you would like them to help finance the repair of that defect (at no cost to you) and you will continue to keep your payments current or you will walk away from the property and they will have to fix it one way or another.

If no one will help you, just stop making your payments and the lender will know you mean business. I would also send a copy of all correspondence to the HOA so they are up to date of what is happening.

As for your tax liability, last December the goverment passed a law to cover that. Just go and talk to your favorite tax expert.

I wish you well, Allisson.

Dick Dennis