Homeowners beware of "helpful" Laywers!

We had a VERY interesting Sales meeting a couple days ago. After all the usual business, we had several guest speakers from Granville. The first did product presentations as usual, but the next presentation was a bit different. The presentation was on the lastest money making scheme some lawyers have developed. These lawyers are preying on home owners who have bought a new build home within the last 10 years. What they are doing is sending a basic form letter to neighborhoods stating that they are representing neightbors that are suing the builder for builder defects and errors. They state that they are going after $100,000 in damages against the builder and that all the owners have to do is join the lawsuit at no cost.

These law suits seem like a great deal on the surface. The homeowners need do nothing. They just sit back and let the class action suit go forward. At the end of the suit, they can expect a check for around $60,000, after the lawyers take their 40%. Sounds great right?

The list of problems and disclosures don't come to the homeowners until near the end of the process or after the suit is done. Most companies forward these claims to insurance and insurance tries to settle the case as fast as they can. So in the end, what happens is insurance will settle for an amount way below the intial $100,000. So in the end, the homeowners will get less than $10,000. It still sounds good right? The lawyers walk away with several hundred thousand dollars because they are taking 40% off of everyones award so they are making out regardless. The homeowner had some spending money for no effort. Insurance paid the settlement. Everyone wins!!! Not!!!

So, now you want to sell your home. Guess what? You now have to disclose to your buyers that your home was subject to a law suit in which the builder built your home with "Defective design, construction and installation" of every major part of your home, at the cost of $100,000. That $10,000 that you spent on a vacation, or new car, or whatever will now cost you way more when it comes time to sell your home. The state of CA requires that you disclose this information, and the TDS (Transfer Disclosure Statement) had better be accurate. Who's going to want to buy your house? Especially if all the "repairs" were never made? What's the real value of your house now?

If there is an actual defect, then YOU personnally need to take action. Hire your own reputable lawyer and then insure that the repairs are made. Otherwise, you can get stuck with a bigger bill in the end.

The Granville representative we had stated that they are now send out packages to resell buyers of developments where the lawsuits have occurred so that they will have the information, and that other builds are starting to do the same thing. So this becomes a situation of Homeowner/Seller Beware!