Irvine_Dreamer said:
Didn't Irvine Pacific make you sign the paper stating that you can't sue Irvine Pacific?
Even if Irvine Pacific had you sign such a waiver, there's no way that would hold up in court, as most judges would say that that is a contract of adhesion (i.e., that you were given no opportunity to negotiate the terms) and that such contract is void and/or uneforceable.
Soylent Green Is People said:
Having purchased in a new Condo development in the past, here's how the drill went for me:
1) Close.
2) Get mail from lawyers trolling for litigation defect news.
3) Someone in the community takes the bait
4) Lawsuit begins.
5) Project is radioactive in terms of buying with any financing.
I saw this post in the OC section of Redfin's Forums:
http://forums.redfin.com/t5/Orange-County/Help-Currently-in-escrow-discovered-pending-hoa-litigation/td-p/463877
so I'm curious if anyone knows which development is not being named, and if any recent new Condo buyers have experienced what I did - a tsunami of lawyer mailings post closing trying to get us to litigate.
I believe that Lombard Court had/has the litigation. If so, my wife used to own a condo across the street (the Santa Barbara tract) and she received the solicitation flyer from the attorney even though she did not live in that tract. I've seen a number of these lawsuits and it is not unusual for a plaintiff's firm to send mailers to anyone and everyone who lives in that tract. Those mailers tend to have very generic descriptions of construction problems such that the majority of us might read that flyer and think, wow, I'm having those issues, maybe I should give them a call!
In my experience, these lawsuits will go on for 2-5 years and all the homeowner gets out of it is $5-10K. The plaintiffs' attorney don't fix anything for you, so the homeowner is left with a few thousand dollars to fix all of the supposed construction defect issues. And since the homeowner releases all future construction claims against the builder, some builders will refuse to repair anything for you once you join/settle a construction defect lawsuit.
Now, if it's the HOA suing the builder (as opposed to individual homeowners suing), I've seen that a large motivating factor is the reserve levels of the HOA. Oftentimes, a lot of these homes/condos were built and sold near the peak of the market, and were thus hit hard by foreclosures, vacancies, delinquencies, etc. that negatively impacted the HOA's reserve levels.
Now, that's not to say that any builder (whether good or bad) won't build homes that do have legitimate defects, such as window or roof leaks that lead to mold, or cracks in the foundation. If one does have issues w/ their home, then, by all means, they should make a claim with the builder to have those issues inspected and repaired, and only if the builder refuses should one contemplate filing a lawsuit.
ps9 said:
What is the worst case scenario here that can scare away potential lenders? Slab leaks?
Hard to say, as I had this issue w/ a prior lender who refused to do a refinance because my HOA had brought a claim against the builder. My suspicion is simply that lenders are overly cautious and over-correcting, given their loose lending standards during the early to mid-2000's. I'm guessing they are simply accounting for a worst case scenario in which they find that the homes are built on a toxic dump site and need to all be leveled (an exaggeration, of course).
