I have a client who bought REO house thru another agent in 2009 but found out from neighbors later on that previous owner shot himself in that house. My client's wife did not want to move into that house and they rent it. Later they filed a law suit against the bank that why didn't they tell there was suicide in the house.

Their attorney asked them that there will be a special appraisal going to be done and the charges will be $3500 which is ridiculous. I suggested them they can find appraiser and probably pay the max $500.

Any ideas how much will be the difference/adjustment in appraisal if the appraiser knows there is a suicide in the house.

Any feedback will be appreciated.

First of all, it depends on your state law as to what the rules of disclosure are about a death or anything other "psychologically impacting event" that has occurred in a house/on a property.

If the buyers were worried about it, they should have asked (here, the Realtor is not to tell if they know unless they are asked in writing - and then they are to go to the seller to get the answer put in writing to give to the potential buyer).

I'm not sure I really understand your question . . . Is the appraisal being done as part of the lawsuit? And what does renting out the property have to do with it?

If it was REO, then there probably was a Disclaimer in the Contract that they signed with the Bank, relieving them (the Bank) of any responsibility for what they didn't know.

Wasn't it sold "As is, where is" ?

People die in houses all the time. Some actively commit suicide . . . . others bring passively about their own deaths through the life style choices they make. There's not really that big a difference. Most houses older that 50 years will have had someone pass away within them.

I hope their Attorney is operating on strictly a contingency basis, and hasn't required a retainer, or that they pay all of his/her expenses.

Your client liked the house enough to buy it and want to live in it so go get it "cleaned up" for her.

My mom used to call in the priest and he'd do a home-blessing ritual and prayer on our homes when we moved in. The new owner's wife believes in and is so scared of ghosts, so a priest might be the cheapest and most-believable route to get her into the home she likes. Suggest it to her.

And if, perchance, she's not Christian, get a feng-shui person to come in and do a space clearing for her.

No offense, but sounds like your clients are dumbassess. What is your involvement at all? Are they buying another house because their old one purchased in '09 is forever tainted in their minds? Tell them that a lot of people scatter ashes in backyards. Some people even have sex in sordid positions in their homes (even in the kitchen!) Every house is tainted. Run from these loons. They sound like the kind who sue if someone sneezes on them. They will buy a house through you, find out that there used to be an Indian burial ground nearby and you will be being sued, next.

Pagans and New Agers will sprinkle salt across the windows and thresholds - keeps the boogeyman out.

I don't think they have a case. No sane attorney would take that on a contingency.

Whoever the ultimate seller was, and it most likely was not the bank that originated the loan (was it Fannie, Freddie, BOA, Wells, a third party outsourcer, etc?) how on earth were they to know someone committed suicide in a home?

Depending on a state's law on when an event occured, it may not even be nec to disclose, let alone disclose at all.

I don't know why a death, sudden/tramitic, or not, would affect an appraisal, PM me & I'll go into detail.

Buyer & their agent didn't perform due dilligence. Cave emptor.

People all react to deaths differently. If you have a house that is over 75 or so years old, chances are somebody died there from natural causes. And there are plenty of houses where people buried their family pet in the back yard.

I don't know how a REO seller would know anything about the history of the property hence they have disclaimers as part of their addenda. Perhaps the listing agent might have know but probably not. And really, if some neighbor told the agent it would still be rumor. You can only disclose facts

In Georgia you don't have to disclose that a crime was committed in the house. If an agent knows and is asked a direct question they do, but if they tell the seller this before the seller says anything about it the seller can choose not to disclose it.


Not a lawyer. No legal advice.

I note you are in CA but in FL they changed the law from it being required to disclose of a suicide to it being illegal to mention if there was a suicide. One of the first houses my wife sold had to have the dishwasher replaced because the bullet (after exiting the head) put a hole in the dishwasher. At that time it was required to disclose. Now we can not mention it due to "Tainting the Property".

Also, since it was REO there is the lack of a homeowners disclosure since the bank has never occupied the property. If they are paying a lawyer as opposed to a contingent basis IMHO they are just throwing away money. My wifes mother passed away in her home from natural causes.

Call Ghost Busters and move on.

Just an FYI at REOExpo it was mentioned that one bank is trying to evict a "haunted" house and it has caused them untold headaches.

It's true that suicide is considered a crime in some jurisdictions; but I don't think anyone has ever been prosecuted for having succeeded in committing it . . . . so it's a crime without punishment.

Okay, this made me laugh. Is the bank trying to "evict" the ghosts or the living who refuse to leave & somehow the "haunted house" aspect has gotten tangled into the mess?

I was not their selling agent and I haven't seen the house either. As per buyer, there were holes in the bedroom ceiling where the suicide was committed. The carpet was all torn. After the escrow was closed they found out from neighbors and they got the police report then they figured it out the holes in the ceiling were from gun shot and under the torn carpet, there was all blood. They repaint the house and changed the carpet. The wife does not want to live in that house and she is concerned about her kids.
This is all what buyer told me.They are interested in buying another house but they want to wait and see the results of lawsuit.

The listing agent knew as per neighbors and neighbors are ready to go in court and say that they told the listing agent. Does it matter I don't know.

Yes, attorney keep charging them like a crazy. I guess chuck is stuck

And yes, the house is in CA and it was Fannie Mae property.