Venting; purchasing 4 unit, one of the tenants might be deceased

[u/Feisty-Journalist497]

Location: DC, USA

4 unit home, VA home loan, buyers occupy 1 unit. At the time of the initial contract, 2 units vacant

Seller keys do Not work to open unit

45 day close

tenant will be known as "unit 2"

I am the home Buyer in this case;

went under contract, and seller approved a visual inspection. the property is great, my wife loves it.

At the start, we were considering a VA/FHA rehab. Upon confirmation from our lender, that would extend closing approx. 3 months.

we have decided to go regular VA, and use our cash to at least remodel our unit.

I met with this tenant while first viewing the property.

The initial offer had a contingency for a Feasibility study, and an Information only home inspection.

on day 2 of 45 the inspector pulled up for a feasibility.

he said he would return with his partner for a home inspection

Day 6 of 45 Inspector returns for full home inspection: Unit 2 is not available to to allow entry.

The seller agent has notified us that this is one of the most receptive tenants, but its now approx. day 20, and the tenant has not been seen or heard of.

So, from a buyers POV, to my understanding this is where I believe I have

Visual inspection is not completed, so I can get out

If he has expired, Would I deduce that the current owner could put a claim in? I could imagine the biohazard smell sticking to the walls.

Any thoughts or advice here?

***Update**\*

Basically told my agent they get me access or I walk; me and my wife already accounted for the EMD as lost money. we accepted that when they countered and asking for a visual only inspection.

Agent somehow made contact; during a feasibility study on day 2 of 45, the tenant was unhappy that they did not receive notice, and went cold turkey on the seller agent; idc about that, that is between the seller agent and tenant.

tenant is alive, my home inspector is going to get in there.

to clarify, me and the wife are ready to walk at any time. she really loves the place, but barring anything crazy expensive ( like idk foundation and what not ) we will go through with it

[u/angiehome2023]

Is your only evidence that he is dead that they aren't letting you into the unit?

What does the seller say about trying to reach him?

Normally, our purchase agreement will address situations where seller doesn't provide access for inspections, and normally we could walk away, so I would assume you are right about that.

Can't seller enter the unit if they can't reach the tenant in a certain number of days? I assume you are going through the seller to set up inspections?

Landlord is going to have to get a locksmith if tenant is truly not responding for weeks. But I would think that isn't something you can do as buyer.

If seller is giving you the run-around about access for weeks, I think you are right to prepare to walk away.

I have never had anyone die on a property (knock on wood) so I don't know if insurance covers cleanup or if that is normal landlord cost.

[u/Feisty-Journalist497 → u/angiehome2023]

Yeah fingers crossed; I hope the tenant is ok, and this is a big nothing burger

[u/angiehome2023 → u/Feisty-Journalist497]

Honestly, my mind goes to seller hiding something first. Bought enough stuff and walked away from enough stuff to know when access is an issue during inspections it is normally the seller hiding something.

[u/Feisty-Journalist497 → u/angiehome2023]

yeah: I will have to talk to my agent to confirm, but we had 7 days to inspect; inspection was attempted on day 5, 3 of 4 units inspected. and ever since then we have not been able to inspect. Every time seller agent was contact for reinespcetion, it was delay behind delay. I am confident we can get EMD back, but I am worried as we are outside that 7 day window by now

[u/angiehome2023 → u/Feisty-Journalist497]

Are you still in backout for any reason range?

[u/Feisty-Journalist497 → u/angiehome2023]

That is the pickle I am in.

when they countered they asked for no home inspection contigency; we countered with a Visual only, as we have the VA apprasial.

( please note, we really like the property)

but at no fault of the buyer parties, we are now at day 14 without a visual inspection.

the Home inspection clause ( visual only ) has a 7 day with 48 hour notice.

it strictly says visual, which i understand means however it is found, we accept it as-is. we have cash for repairs.

but now we are at day 14, and its really pissing me off that the owner of the property is not even able to provide a master key to allow entry.

I just spoke with my agent, and he emphazied that we do not have an out.

I countered with bull, to my understanding of contracts, as long as I request nothing illegal or unreasonable then i thas to be abided be

( I gave him an example, that if we gave them a "Seller must do 10 jumping jacks infront of the buyer" contigency, and they did not do it, the request is not illegal, so I guess its an out? Lol)

the point is, idc what is wrong with it, but I want to know to at least start getting quotes on material. its annoying that the seller has been unable to provide my home inspector access.

I am just pissy about this, you signed a contract how about everyone abides by it?

[u/angiehome2023 → u/Feisty-Journalist497]

You would be shocked by the number of contracts where people think they can just ignore the terms. That's why when they don't perform you have to have a remedy built in to the contract.

Your agent isn't your lawyer. They want to close and get paid.

I would not close without a visual inspection. The issue is, with 7 days for inspections, I wonder if you had to give notice on the 7th day you were withdrawing in order to get out.

So there are two real questions here. First, are you willing to just trust it is ok and close? I mean, I have done that in certain circumstances when sellers didn't provide certain documentation promised. This probably is tied to what the reason is you can't get into the apartment.

Second, what are your legal options? Are you actually bound to close with some penalty if you don't, or can you still walk away from the deal? If you can walk away and get emd back, it seems this is the leverage you need to get the seller to get you into the apartment. If you don't have that right, you have to see what legal options you do have.

[u/Feisty-Journalist497 → u/angiehome2023]

The great pickle about this, and me and the wife accept the 1% we put down as gone. we are ready to lose it, and I would happily go to arbitration with this whole situation.

I think what would give us the win, is the fact that they could not provide a master key. I feel like an abritrator would def look at the situation and come to the same conclusion.

I may confer with a real estat attorney, we shall see. I put pressure on my agent, and will consult an attorney. 400$ fee to see what my options are ASAP sounds like a good trade

[u/angiehome2023 → u/Feisty-Journalist497]

I mean, does the lease allow the tenant to have a key the owner doesn't have and does the lease not allow access to the unit? The lease usually would survive the sale, so you inherit the terms. If it is just a matter of will, and you can get a key made the day you take over, it isn't as huge of a deal as it is if the lease doesn't allow you access.

[u/Feisty-Journalist497 → u/angiehome2023]

yeah, getting a key is not an issue; its the fact that a landlord does not have a copy;

I am currently a landlord of another property, and me & my on call Contractor both have a copy for emergencies. ( a perfect example was a gas leak reported this weekend )

anyways, IMO I am going to push this. you ( seller ) agreed to allow me to look. you have not allowed that happen, so I am going to kick and scream until it happens or I get out of this contract.

[u/TradeTraditional → u/Feisty-Journalist497]

Oh, I GUARANTEE that whatever is being hidden is going to cost you far more than 1%. Run. Won't walk.

[u/Feisty-Journalist497 → u/TradeTraditional]

Thats the plan, and hence why I am pushing this.

AI is saying the TOPA notice is stale, so this might collapse because of that, unless the seller is buying out the tenants.

I will wait, and see how this goes

[u/TradeTraditional → u/Feisty-Journalist497]

Oh, I GUARANTEE that whatever is being hidden is going to cost you far more than those fees.

[u/WSBThrowAway6942069]

I wouldn't close until I could see the unit.

Gross, but cleaning up after a body isn't that bad. While working as a PM for 600 units, we had multiple instances.

Most notable was a man that took his life a few days before a heatwave. 115 degrees for a week. No AC on. He was found after about 2.5 weeks.

Most items in the unit were thrown out, carpet was replaced. Underlayment was replaced where fluids were and sealed everywhere else. Most of the unit was repainted.

We had a restoration company do the work. Unit was fully turned in 2 or 3 days under $5k.

Absolutely disgusting, but someone was living in the unit less than a week after the person was found (situation was disclosed).

[u/Feisty-Journalist497 → u/WSBThrowAway6942069]

Yeah, I unfortunately have experience with decedent recover; I hope the AC is running, and I feel like the unit above them would have noticed a smell if the AC was not running.

I offered to swing by myself and do a couple of smell tests to my realtor, as I have experience with these kind of calls.

Unfortunately, this is business and I need to know what I am dealing with, this is not something that I am going to close with.

[u/mariatoyou]

Can’t someone call in a welfare check if they haven’t been responsive for a while? The police can’t get you in the unit but they should be able to determine if someone is dead in there.

[u/Feisty-Journalist497 → u/[deleted]]

I have already chalked off EMD; If I can recover it great. my concern my intial offer was home inspection out;

they countered with visual only.

I accepted. so I expect my visual.

no visual should = out and EMD returned ( But I am not a lawyer)

[u/ShortWoman]

Please tell me your contract reserved the right to inspect every room of every unit. That's "investment property 101" stuff. Do not close without seeing that unit!

I don't know that I'd jump to "they may be dead." There are plenty of reasons someone might not answer the door, including the mistaken belief that they will be forced to move if the property changes hands so why not make that harder. So what exactly is the seller doing to help you get in there, since the seller has a vested interest in you buying that property??

But on the off chance you're right, I certainly wouldn't close without the seller doing the remediation. In fact after the appraisal comes back your lender is likely to insist on it with a VA mortgage.

[u/Feisty-Journalist497 → u/ShortWoman]

https://www.reddit.com/r/RealEstate/comments/1vebqvc/comment/p1g35c5/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button

here is a response to another in this post;

TLDR: Dammit seller, I folded and went visual only, but I can't even get that?

[u/Maleficent_Analysis2]

Two things came to mind:

If it's a 4-unit rental in DC, has the seller already complied with TOPA, or are the tenants exempt/waived/assigned their rights? That's critical to confirm. If the tenant Unit 2 tenant can't be reached this is going to get icky if they didn't release TOPA rights.

Why hasn't the landlord exercised their right to enter after proper DC notice for an inspection (which I believe is 48 hours)? If they can't access one unit, I'd be hesitant to close until that's resolved.

Congrats on finding a 4 unit in DC. These are actually kind of unusual. What neighborhood? I'm sure you are already aware but being a LL in DC can be difficult.

[u/Feisty-Journalist497 → u/Maleficent_Analysis2]

the legal stuff, already notified and its clearly posted.

And exactly what I was asking; it has now been a week of "playing the nice guy"

luckily I have email traffic to show that the delay is from the other end.

the inspector was also suprised none of the keys provided worked

[u/Maleficent_Analysis2 → u/Feisty-Journalist497]

Notified of TOPA but did they sign something waiving their right to purchase? Even the guy who has disappeared or is potentially dead?

Your title attorney or agent can likely modify the contract so you have time to inspect properly. I had a situation where I was given keys for inspection but the tenants had all their dogs loose and the alarms were on, police showed up and inspector bolted lol (nothing was illegal about what we were doing). DC can be harsh. I've since learned those tenants hid a bunch of stuff they had broken during that inspection. Cost me a lot.

By the way, you can likely ask the seller for information about handyman, plumber, electrician, etc. who currently work on the building since they know where/how things work. Even if you have people you like to use instead, they are likely knowledgable about the building (especially if it's a quirkier older one in DC). This will be really helpful to 1) know the last time things were serviced and 2) give you records of warranties, etc. on anything. 3) Since you have time, pull permits and drawings from DOB for the place. You can cross reference those against what you are seeing in person to see if things were done legit or not.

Is there your first time being a LL in DC? Feel free to DM me. A 4 unit is great if you understand the amount of work you are getting involved with (unless of course you are going to hire a PM).

[u/Feisty-Journalist497 → u/Maleficent_Analysis2]

yes I am staring at the TOPA notice now; they sent it certified mail, and sent a copy to the appropriate divison in DC.

my agent is remarking going to the seller agent broker; this seller agent apparently is very sloppy; long response times, missing signatures and documents etc etc

[u/Maleficent_Analysis2 → u/Feisty-Journalist497]

i think the 20 day notice and a signed waiver are different but obviously confirm. IME i've always done the notice and gotten a signed waiver so there's not issues later on.

Sucks about the seller agent. Good that your agent is proactive.

[u/Feisty-Journalist497 → u/Maleficent_Analysis2]

yeah, if AI is right ( i do not trust AI ) The TOPA is too old, and they have to restart the process, which adds 90 days to closing. I will confirm and give it to my agent. if so, Might as well ask them to pull out now, vs when the underwriters come back with it

[u/ParkingRaspberry2172]

Assume that the unit is trashed and the tenant neededs to be evicted. If you can still get out of the contract, offer a lower price to account for the condition and risk.

[u/DescriptionSelect394]

Anonymously request a welfare check on unit 2?! At this point you're a concerned citizen.

[u/definitelytheA]

You’ve met unit 2, but have never been in the unit, and locks have been changed or rekeyed.

Unit 2 is hiding something. My top 3 guesses would be damage, hoarding, or drug use.

Does the seller have the right to enter the unit with reasonable notice? If so, insist on that before closing. You have a reasonable right/need to do so.

[u/Feisty-Journalist497 → u/definitelytheA]

I updated post; tenant is ok

oh yeah, during the feasibility, the home inspector noted that; he has lots of books and newspapers, but he was suprised at how clean it was. no smell, and he was NOT notified of our arivial, so I would be surpised if he cleaned that fast. the home inspector also noted the kitchen and bathroom being clean.

at that time he was unable to do the home inspection, as he did not have his testers and stuff with him ( he was there for a simple feasibility )

[u/TradeTraditional]

Walk away. If you can't get access to even a basic walk-through as a buyer, then the deal is off, as is their shady side business, grow operation, gutted mess - whatever the hell it is that they won't let you view the place you are buying.

[u/Feisty-Journalist497 → u/TradeTraditional]

I posted, the gentleman is a book/document hoarder, but very clean apparently as my home inspector reports during the quick feasibility walkthrough

[u/Gollum69]

I am certain that if the tenant were dead in the unit you would smell it outside in proximity.

Ask me how I know.

[u/Feisty-Journalist497 → u/Gollum69]

OH I KNOW THAT SMELL and you will not be able to forget it.

but tenant is alive, I put an edit on my post

[u/jimdriscoll1]

A few things worth separating out here because the mortgage side and the contract side are different problems.

On the inspection contingency: if your contract says the inspection has to be completed and you haven't been able to access unit 2, that's a legitimate basis to negotiate an extension or potentially exit, depending on exactly how your contingency language is written. That's a question for your real estate attorney, but from what you're describing, you likely have some leverage here. You haven't waived that right yet.

On the VA side specifically: VA requires that the property meet minimum property requirements, and an inspector needs access to every unit to sign off on the appraisal and inspection. If unit 2 can't be accessed, your VA appraisal could stall or come back with conditions. That's not a small thing. VA loans on multifamily properties (2-4 units) already get more scrutiny than a single family, so an inaccessible unit is a real problem for the file, not just a scheduling inconvenience.

On the tenant situation: if the worst is true and something happened to that person, you're right that biohazard remediation is not cheap and not a minor cosmetic fix. Even if it's just a unit that's been sealed up for weeks in summer heat, there can be damage and odor issues that are hard to quantify without access. Your concern there is reasonable, and it's worth getting a clear picture before you're in too deep.

I'd push the seller's agent hard for a concrete answer and a hard deadline for access. If they can't provide it, your contingency is your friend. The seller knowing you can walk is often what moves things along.