Michelle and Alon Frumer have discovered the hard way that a new home is not a guaranteed route to trouble-free home ownership. What's more, home warranty companies are not all they're cracked up to be either, according to Angie's List, an online service rating companies that provide home warranties, and in some cases an extended warranty, to homeowners who have purchased a newly constructed house.
The online review company reported recently that for the seventh year in a row, home warranty companies took the dubious distinction of having the worst ratings and grades amongst service providers last year, according to Angie's List.
The Herald News of Passaic County, New Jersey (2/12/12) recounted the frustrating events surrounding the purchase of a large home by the Frumer family in 2008. Located in Englewood, the large home valued at $997,000 had recently been built by an independent contractor. As the home was new, the family decided against employing the services of a home inspector, assuming the home would have been properly inspected by municipal officials during the construction process. There was also a home warranty in force.
However, the Frumers soon learned the home was compromised with a litany of problems and building code violations that threatened the structure of the home. What's more, the development of mold threatened the family's health. They moved out in 2009—first into an extended-stay hotel, then later into a smaller home they purchased.
After discovering the contractor who had built the home was "defunct," the Frumers turned to the home warranty insurance company. But 2-10 Home Buyers Warranty Corp. of Denver allegedly brought them little solace.
While Michelle, Alon and their two young children initially confined themselves to a large bedroom upstairs, their home warranty insurance company brought in a contractor who ripped the house apart, indeed finding a litany of serious issues.
Eventually, after the Frumers moved out, 2-10 Home Buyers Warranty Corp. directed its contractors to halt work on the home. Inspectors called in by the Department of Community Affairs of New Jersey found no fewer than 13 building code violations, including missing support columns.
READ MORE HOME WARRANTY INSURANCE LEGAL NEWS
The family has launched a Home Warranty Lawsuit, alleging bad faith insurance against 2-10 Home Buyers Warranty Corp. The plaintiffs feel they should be compensated for the original value of the home at the time of their purchase. They have also sued the architect, the builder and the contractor whom 2-10 Home Buyers Warranty Corp. sent in to do the repairs. Alleging the home was not properly inspected during construction, the Frumers are also suing the City of Englewood, where the home is located.
I had moved back to Texas after many years in CA. Becoming disabled, I could no longer afford to live in CA.
I, too, was under the belief that, as the home was built by a "reputable" builder, that I did not need a home inspector. I have a 10-year structural warranty as well as a home warranty through 2-10 home warranty. During the course of the settlement, the builder told me that I had a one year home warranty and a 10 year structural warranty.
For starters, I have overpour of the foundation - cement - into the flower beds created between the house and sidewalk - filled in with 2" to 4" of topsoil. I became aware of this when I planted flowers. I called the builder and was told that there was nothing they could do. I was told to call my home warranty. I called 2-10. I was told it was structural. The structural department said that I had to call the home warranty department in order to get the overpour handled, as that it was covered under the home warranty.
I called someone independent and was told that the overpour extended approximately a foot or more and was directly attached to the foundation. Removing the overpour would cause damage to the foundation. This sounds like a structural issue to me. However, 2-10 stated that it is not a structural issue. 2-10 stated that it should have been handled during my first year, and that there was nothing they could do, as my first year new home warranty had expired a WEEK BEFORE! My home was no longer considered a "new home".
During my first year inspection, I found many cracks in the ceilings and walls. The builder chalked it off to "the home settling." 2-10 Home Warranty would not send out a home inspector without my paying $50, but then they only cover repairing the "damage" and not inspecting it. The builder patched the cracks, repainted and left. Less than 2 months later, the cracks were back. The bulder again chalked it up to the home settling and patched it up again. The builder's crew had to come out numerous times for this. Some of the cracks have again come back.
I have a water bill each month that greatly exceeds my neighbors. I have been sent notices by the water company of excessive use of water, for which I am penalized every month. (I live in a draught area.) I live alone. My neighbors on each side of me have a water/sewer/trash bill never exceeding approx $145 at the maximum. They have families - 4 or 5 people households, daily bathing, daily laundry, daily cleaning, daily dishes, daily dishwasher use, fescu grass requiring 10 minute watering per zone twice daily, etc. I take a bath every day and do laundry twice a week. I run my dishwasher about twice a week and wash dishes when I eat- approximately twice a day, daily cleaning, have bermuda grass which requires 6 minutes per zone 3 days a week. MY water/sewer/trash bill runs between $380 - $500 per month. I am on a fixed income. I told the builder I have a leak SOMEWHERE! THAT issue is STILL open! I believe it to be a slab leak, as the grout between the tiles in a specific area of my bathroom is always wet. 2-10 would never send a plumber to find the leak.
On one occasion, I spent $50 to get a 2-10 contractor out because my A/C was not working properly. The contractor came, said that I needed a new thermostat. He said that he would get the part and come back. He never came back. I had to pay to get a new thermostat put in.
When I had the house 2 years, I had a flood in the living room. I thought the hot water heater broke or something. Come to find out, the builder used a smaller than normal (still up to code, but most builders or plumbing contractors won't use it due to the chance of flood) air conditioning condensation overflow valve leaked into the house - a very slow, very subtle leak, leaking into the walls first, then under the carpeting. I had an Oriental rug over my carpet to protect it. The water leaked under the rug - thereby hiding the leak even further. By the time anyone knows that there is a leak, the carpet is destroyed. It cost me $50 for the plumber to make an emergency visit to my home late on a Saturday evening. He repaired the faulty valve, but 2-10 stated that they do NOT make any repairs due to damage caused by covered work. 1/2 of my entire living room was flooded and hallway was flooded althewhile destroying the carpet in that portion of the house. The sad part was that the ONLY place I could actually feel the water was near the wall near the faulty valve. (The plumber placed the valve in such a position that, rather than drain outside, the water would drain inside the house.) Imagine how I felt when I realized that the water had accumulated in such a large area and I did not even know it. (Incidentally, I do not wear shoes in my house. I always go barefoot or am in my socks, as are visitors to the house. The company who set up fans to dry the carpet did a moisture test and told me the extent of the damage - 2 feet up the walls, the front half of my living room, and a portion of my hallway.) The damage was so great that the edges could not be re-tacked , as the water had frayed them so badly.
I was under the assumption that the damage would be covered by 2-10 also - from what the sales person told me when I repurchased the warranty. I had to call my insurance company. I have a 1% deductible. It cost me $1638 to have a company come in, test the moisture level throughout my living room and hallway, set up fans to dry the hall and carpet, pull the water heater and central heating and air unit out, replace the subflooring, replace everything, put in a water alarm into the closet, repair the valve, plus the difference in the carpet that was there and the tile that I chose to put in rather than new carpet throughout. I chose tile, because the plumber told me that it would happen again. I figured it's cheaper to replace a popped tile than it is to replace the entire carpet again - especially when one knows nothing until the damage is so great.
When I spoke with the builder, I was told that it was my fault, as it was "owner maintenance." They said that I was supposed to bleach down the valve once a month. I had never in my life heard of such a thing. There was no documentation pertaining to that effect. There were no notes in my orientation book stating that I was told. There was nothing on a checklist. Incidentally, this has now happened to several people in my neighborhood. Even last month, the carpet drying place was at a neighbor across the street with their truck and hoses and fans, suckig up the excessive water and drying the walls. I assume the same thing happened to them. Another of my neighbors experiencing the same problem moved and sold his house.
I was charged $50 by 2-10 for the plumber to come out and put in a 50 cent valve, as well as over $2300 for my deductible and repairs. I am on a fixed income. I don't have the kind of money it took to do the repairs. The builder never helped with the repairs, claiming I was at fault. 2-10 said that they were not responsible - that I was. I was told to call my insurance company, which I did. My deductible was 1% PER OCCURRENCE! Well, after that I lowered my deductible to as low as my insurance company would allow - $250. If this happens again in the future, I will be told I am responsible - even though I pour bleach down the overflow valve regularly. The plumber who did the repair put in a larger, more efficient valve. He told me and the contractor who did the repairs that the original valve was too small. However, he would not testify to that in court, as it is still allowed by the courts. One thing the plumber, the builder, and other contractors have said since the repairs have been done have asked. I was asked if this was a Betenbough home. I said "Yes." I was told that the builder cuts corners and is known for the shoddy work that he does. The particular builder builds subdivisions under different LLC's and LLP's so that he cannot be directly sued without finding all of the members of the corporation, LLP, or LLC officers. I was going to take him to small claims court, but I was told that - without that information - if I sued the "wrong person" that no one would be responsible. After the subdivision is built and the homes sold, the LLC or LLP or corporate structure of that subdivision is dissolved. WHO does one go after?
My water problem still exists to this day. I have extremely high electric bills - running about $250 - $300 per month. After the fiasco of the plumbing issue, I am afraid to call out 2-10 for more than an appliance or something. They left me in a mess! As far as I am concerned, their warranty has not been honored. It is supposed to cover the sprinkler system. It is almost cheaper to get the sprinkler, fences that fell down by the section and by rotted boards, all that they cover repaired myself.