House my friend owns is in danger of collapsing into a sinkhole

Calica

Description of the problem, copied from the fundrazr page:

[Friend] and [Spouse] are renting out their old house to a wonderful family. The house is in dire trouble. Apparently a previous owner (not sure which one) built part of the house on a cistern (dry well). The house is both over it and being held up by it. They did a bad job and now due to the rain we got this year the house is in danger of collapsing. As of now insurance isn't going to cover this because they said it was due to settling soil, which isn't under policy. The hole is growing and is very deep. Long story short, it will probably cost about $12,000 to fix the problem.

If the problem isn't fixed, they will need to foreclose on the home and the family renting the house will need to find a new place to rent. As you can see, this isn't a good option for anyone. The house could end up looking like the one in the picture above.

(Where it says "they will need to foreclose on the home," it means the bank will be doing the foreclosing, not my friend.)

My friend is absolutely not in a financial position to pay to fix this. Rent from the house is a significant part of his family's income. The fundrazr page was set up by my friend's brother, and it's a kind gesture; but I highly doubt that they'll be able to raise the money this way before the situation becomes critical. Personally, I'm on the fence about donating, but that's neither here nor there. What I'm hoping to find out by posting this is whether my friend has any options at all that don't involve either financial or literal ruin.

bowen

Get a second mortgage on the house, raise the rent to cover it. We're talking like $35 a month over 10 years.

That's really your best option besides a fundraiser.

kaliyama

What @Bowen said - mortgage now, consult an attorney about litigation with insurance and prior owner later. Might want to talk to attorney sooner re: insurance issue as insurance agreement may have time limitations that run when a claims denial is given.

Calica

Um... maybe a dumb question, but can they take out a second mortgage if they haven't paid off the first one yet? Friend posted on Facebook that they can't find anyone willing to give them a refinancing loan; I'm not sure if that's the same thing because I have no idea how home ownership works.

bowen

Refi is different, you can take out a 2nd mortgage so long as your house has equity.

Also, a lot of banks will give you a loan if you need to fix a catastrophic issue because it's better than having no collateral left on a loan, which means people won't pay it back. I'd start with the same bank that owns the loan. They have a really good reason to not let that house collapse in on itself.

Aladorn

Hey everyone. I'm the friend Calica is talking about. Just to clear up some details. We have negative equity in our house. It's a real thing...my wife says so. We owe more than the house is worth. That is mostly due to timing because we were one of those people that got a loan on a house that was overpriced right before the housing market crashed.

As for the previous owner(s), we bought the house from an elderly lady that lived there for only 12 years prior to us. She had nothing to do with the part of the house that was added on over this cistern. We're looking into who did do it.

We talked to our tenants but due to the fact that one of them just lost a job right before this all happened, raising the rent would cause our tenants to move out. Which is what's going to happen anyway this rate.

Unless there is something else we can do we're probably just looking at damage control at this point. Thanks everyone for your wisdom.

The Ender

...Have you talked to anyone about filling the hole? I assume that's the $12,000.00 fix?

Do you live in town? If so, have you talk to town council about this? They should be willing to subsidize the fill, I would think, given that they probably don't want a gigantic fucking hole in the ground where property once was.

bowen

Yeah like I said, A loan for that amount is going to run about $35 a month over 10 years. If the town won't, the bank that owns the loan would probably rather give you more money so that their collateral isn't worth jack diddly, more than what little it is now. Everyone has a reason to work with you over this. But no one's going to refinance it.

zepherin

That sucks bad. I know a couple of cheap solutions that will keep the house from dropping in for a bit. If you show me some pictures and give me a quick diagram I may be able to come up with something a bit more substancial than line the well with rebar and concrete and mesh to keep the hole from expanding.

If you've got some dudes I can apply methodology, but unfortunately it may come down to having to jack up the house, properly fill the well, redo the slab the house is on and set the house back down.

azith28

I'm not an engineer, however this kind of problem is one of those that REALLY sounds like no matter how much money you put into it its going to keep happening and get worse over time. You dont mess around with sinkholes. I'm sure there are quite a few landscapers who will want to try and make a buck from you to fix it temporarily but you might want to get some opinions from a geologist if putting money into this fix is actually going to do anything but continue to be a sinkhole for your wallet.

bowen

Yeah I figured 12k is the low end for doing that last part. I'm hoping the hole can be filled and it's not going to condemn the building.

zepherin

azith28 wrote: »

I'm not an engineer, however this kind of problem is one of those that REALLY sounds like no matter how much money you put into it its going to keep happening and get worse over time. You dont mess around with sinkholes. I'm sure there are quite a few landscapers who will want to try and make a buck from you to fix it temporarily but you might want to get some opinions from a geologist if putting money into this fix is actually going to do anything but continue to be a sinkhole for your wallet.

My background is construction not landscaping, but there are ways to keep the sinkhole from consuming the house, depending on how deep the sinkhole is and the location of the house. Generally you make sure that it is in deed dry you make sure there is a way for water to escape, fill it with gravel, compact it, repeat until you get close to the top, put in rebar, vents, then concrete. Make sure people don't go in there because of the potential of gas.

We get sinkholes where I work on occasion from water breaks, and that is what we do.

That being said if the thing is expanding, finding the cause is important, and try to get the city, county state federal governments involved, because it risks the block not just the house.

Liquid Hellz

Catastrophic loss is usually covered by insurance so just wait until it falls in the hole and collect if so.

bowen

...Make sure to evict the family first.

bowen

Hopefully they're not there right now, because that's a huge legal issue if so, they could sue you if they know about it and you haven't kicked them out and not rectified it immediately.