I bought my first home, only to become a victim of predatory remodeling.

This is the story of how I got tricked by malicious criminals into purchasing a home that was riddled with code violations and faulty, unsafe conditions. The house flippers were not licensed contractors, and no building permits were pulled. There was no paper trail, and no way for my house inspector to detect the multitude of problems that were cleverly hidden behind beautifully finished drywall, concrete, and woodwork.

May 20, 2013

I closed on my first house! $174,000 with 4 bedrooms, 2 full bathrooms, attached garage, and 2,170 square feet.

1968 ranch house exterior
New house keys in the palm of a hand
1968 ranch floor plan, main level with contemporary dining room addition
1968 ranch floor plan, basement level

Soon, my family and I moved into our new home with the help of friends and relatives. It was beautifully finished from top to bottom. We were so excited to own our first house!

Remodeled kitchen
Flooring
Contemporary addition solarium dining room
Basement recreation room
Lower level master bedroom
Remodeled basement bathroom with corner shower

Day 2

Like any responsible home buyer, I had the property inspected before purchasing.

Bathroom fan
One of the few things my inspector found was that this bathroom fan was not ducted through the roof, so it was blowing moisture into the attic. We promptly had it replaced by a professional.

Day 3 – Subtle Hints

But soon we began to notice lots of strange problems with our new house. At first, they were small.

A cupboard door that was never attached to its hinges.
For example, this cupboard door that was never attached to its hinges.
Washing machine hookup hoses connected backwards
And the hookup hoses for our laundry machine were connected backwards. (Hot water connected to cold input and vice versa.)
Cable TV wall plate with short tail of cable attached.
And none of our cable outlets were working. We called our service provider who sent out a technician. He discovered that none of the outlets were hooked up to the household service!

Day 10

Handle that has come off a running bathroom faucet
The handles fell off the bathroom faucet…
Underside of a vanity, showing a drain lever with missing parts
…and the drain lever had missing parts underneath the vanity, so it didn’t work.
Dipwire shelving
Several rooms had dipwire shelves that were not attached to the studs! When we put any amount of weight on them, the shelves simply tore free from the drywall. The same thing happened when hanging our coats on the coat hooks near the front door!
Bifold closet doors with handles installed on the wrong half of each door
Additionally, a closet had handles installed on the wrong half of bi-fold doors.

Day 12 – Water Damage

Laundry room
Less than two weeks after moving in, I was shocked to discover a large puddle of water on the laundry room floor that was rapidly leaking through the basement ceiling.
Water leaks through a ceiling
Water had opened up this seam in the drywall. It looks like it has been patched before. The upstairs bathroom is directly overhead.
Shower manifold with the handle and escutcheon plate removed, revealing a leak
We brought in a plumber to diagnose the problem, which turned out to be the upstairs shower manifold which was badly spraying water inside the walls whenever the shower was run.
Seriously burned house framing from sweating copper pipes in place.
When he took a closer look, he noticed something very disturbing: The shower manifold was soldered in-place with a blowtorch that badly burned the framing of the house!
A plumber shines a flashlight inside an inspection hole in drywall.
Our plumber immediately suspected that there were many more plumbing problems and building code violations with my house, so I agreed to let him cut some inspection holes in the drywall to investigate.
Inspection holes cut in drywall above a toilet where vent pipes should be.
The plumber discovered an incredible number of building code violations. For starters, none of the plumbing in lower level had any drain vents! Without these vents, suction keeps the drain water from ever reaching the sewer. These inspection holes showed that there were no vent pipes inside the bathroom walls.
Scraps of copper and pex pipes pieced together amid burnt house framing.
He also discovered six additional leaks inside the walls, all due to incorrect plumbing with scraps of pex pipes patched together with copper pipes and more framing badly burned by a soldering blowtorch.
PVC pipe T-union used improperly.
Incorrect plumbing unions were used throughout the house against building codes. The upstairs bathtub drain was illegally connected to the rest of the drain stack with T-union.
Laundry connection box with the drain pipe reduced against code.
The laundry drain was illegally reduced from a 2” pipe down to 1 ½” pipe against building code.
View inside a shower drain, revealing no P-trap.
The master bathroom shower drain was illegally connected into the wrong size and type of pipe, and had no P-trap against building code.
Backwards Y-union cemented into sewer clean-out.
Incredibly, the washing machine drain was connected with a backwards Y-union, and all of the new plumbing was illegally cemented into the sewer clean-out access!
Air admittance device used instead of plumbing vents.
And that was just the lower level! In the kitchen, our plumber discovered this illegal air-admittance device (against code in Minnesota) instead of proper venting pipes.
Incorrect dishwasher hoses running through a sink base cabinet.
The dishwasher was hooked up with the wrong type of hoses.
Metal junction box missing a bushing.
The garbage disposal was wired into a metal switch box without a bushing, against code.
Plumbing never fastened to framing
And in the upstairs bathroom, the water pipes were never fastened to the framing.

I was puzzled how any of the plumbing could have been faulty and so far out of code. Before buying the house, I checked the building permit history, and there were no permits pulled in recent years. I assumed that any work done on the house by the Seller was simply cosmetic, like paint and carpeting. But I was so wrong.

Day 14 – Online Evidence Discovered

I did some online research and discovered that our house had been purchased by a flipper on October 16, 2012 for $84,900. Over the next 4 months, the flipper secretly remodeled the house without building permits or licensed contractors until February 19, 2013. He then re-sold the property to us at a 200% markup.

The dated photos on Zillow.com show just how much the house changed during the flip. Major walls had been removed to make the house feel more open.

Living room with windows, door, and closet.
Living room with windows, and door, but closet removed.
The front entry closet had been removed.

Kitchen with corner sink and dining room with closet.
Kitchen with sink moved across the room and dining room without closet.
The galley kitchen had been completely gutted and re-done with recycled cabinetry and low-end fixtures. The adjacent dining room had a closet removed.

View of a room with a kitchen wall on the right.
View of the same room but the kitchen wall has been removed.
Two of the major kitchen walls had been removed.

Basement with support column and partially demolished drywall from flood water damage.
Completely finished basement with support column removed!
In the basement, the flipper removed a load-bearing support column to make the room look bigger!

Week 3 – Severity Confirmed

The flipper had put our lives and property in serious danger by removing load-bearing structures. This reckless behavior could have killed me and my family, so I called the police. The officer was sympathetic to our situation, but did not believe it was serious enough to warrant police intervention.

We needed to get an understanding of how serious the problems were, and how much they would cost to repair, so we began calling general contractors. One by one, they visited our house, and were mortified at the condition of the property, claiming that it was worse than anything you’d see on the popular remodeling TV show Holmes on Homes, and that it was clear that the illegal remodeling work was done intentionally, in a predatory fashion, to flip the house onto an unsuspecting buyer and tricking them into ownership of the multitude of code violations. One contractor even stated “Whoever did this work needs to go to prison.“

Week 4

A computer monitor with a colored spreadsheet and corresponding Post-It Note stuck to it.
I began documenting all of our house problems on a spreadsheet, and labeling them with color-coded, corresponding Post-It Notes throughout the house.

I called our city Building Official and asked him to come see the damage. Much like the general contractors who had looked at it before him, the inspector was absolutely shocked at the level of malice that went into remodeling. He stated, “I wish we had caught these guys in the act. They’d be in jail right now.” Furthermore, he ordered us to make the structural repairs quickly amid concerns that a large snow pack on the roof could cause the structure to buckle. Failure to fix the house before snowfall came with the threat that the city would condemn our house and evict me and my family.

Without any help from the inspector or local law enforcement, I moved-up to the next level of government by contacting my county attorney, and began working with a Civil Investigator. She admitted that my case “certainly sounds like ‘theft by swindle’“, and began an investigation into the Seller and his associates. The Seller deferred taxes by running the transaction as a 1031-Exchange through the IRS, and he provided outdated contact info. Legal advisers believe that he knew exactly what he was doing, that he had committed this type of fraud before, and that he may even use offshore bank accounts.

What’s more, the Seller kept all of the building code violations secret behind a “Seller’s Disclosure Alternatives” form, which means I bought the house “as is”. I had assumed that my realtor had my best interests at heart, so I expressed concern about the paperwork to him. My realtor insisted that this form was “very common”, that it was “no big deal”, and that if I didn’t sign the form, it would definitely mean losing the house to other bidders. He coached me into signing the waiver.

With those avenues closed, we learned that our only options were to:

  • Abandon the house, forfeit my mortgage and ruin my credit for 8 years.
  • Pray for some kind of disaster, such as a fire, that would be covered by our insurance.
  • Pay tens of thousands of dollars for the repairs out of my own pocket.

It was at this moment that I realized that I had been utterly ruined. I was devastated. I could barely manage a phone call with my stunned parents, and I spent the entire night awake and sobbing.

My story began to appear on the evening news…

…and in magazines.

Remodeling magazine, July 2013 issue

Meanwhile, the problems just kept piling up.

Cracked floor tile near a doorway
The tile in the front entryway cracked, indicating that it was improperly installed by the flippers.
Cracked bathroom tile with flakes of grout
A few days later, the bathroom tile cracked as well.
Rotten window sill that has been filled with expanding foam and concealed with paint
One of the bedroom windows had a frame and sill that was mostly rotted-away. The flipper simply filled the rotten gap with yellow expanding foam, and painted over it to hide the problem.
Paint peeling off a wall without primer
While hiding all of these building code violations, the flipper decided to take another shortcut and spray paint the walls in one thick coat without paint primer. All of the wall paint flaked off easily in large sheets.

Month 2 – Demolition

It was too difficult for contractors to estimate repairs to my house when the known problems were still covered by drywall and tile, so I hired a general contractor to do some basic demolition work to reveal the problems.

Instantly, 50% of our square footage that comprised the lower level of our house, including the master bedroom, became unusable. We reluctantly moved all of our furniture and belongings to the upper level, and unhooked our laundry machines. We began hauling our dirty laundry to my parents’ house each week.

A large number of additional plumbing problems were found.

Annotated photo of plumbing problems.
In the laundry room, the flipper intentionally covered the only floor drain in the house with an installed base cabinet, used a backwards Y-union, and cemented the drain pipes directly into the sewer clean-out access.
Drywall screw puncturing a PVC drain pipe
PVC drain pipes had drywall screws puncturing them! These were supposed to be protected by metal stud guards.
Vinyl dryer hose illegally covered with drywall
We also discovered that the dryer was hooked up with a vinyl hose that was covered with drywall, against code.
Floor joist improperly cut away for drain pipes
One of the upstairs bathroom floor joists was illegally cut more than 2/3rds of the way through to allow the bathtub drain pipe to pass through it. This left the joist severely weakened.
Annotated photo of partially demolished underground drain pipes showing illegal connections and no vents.
The bathroom drains were a zig-zag of piecemeal pipes, rubber unions, and another backwards Y-union. None of the drains were vented, and none of the work was even close to building code.
Two men dig underground pipes out of a basement floor.
Many friends offered to help us with the ongoing demolition. Here, they are excavating the improper underground drain pipes.
Partially excavated drain pipes in a basement.

Month 3 – More Hidden Plumbing Code Violations

Ice and water dispenser on the front of a refrigerator
The refrigerator had been installed without a shut-off valve or any slack in the water / ice-maker line. When we pulled the fridge away from the wall, it ruptured the line, spraying water everywhere.
Saddle tap valve for refrigerator ice maker water line, illegal in Minnesota
In the basement, this same water / ice-maker line was installed with an illegal saddle valve.
Self-tapping saddle valve piercing a copper pipe
Saddle valves tap into copper water pipes by puncturing them. These are not allowed in Minnesota (and a growing number of other states) because they are prone to leaks.
Gas shut-off valve between floor joists
Unbelievably, this important gas shut-off valve was concealed above the basement ceiling drywall!
Annotated photo with inset showing a water shut-off valve concealed by drywall.
And this important water shut-off valve was hidden above the downstairs bathroom ceiling!
Demolished bathroom ceiling showing a water shut-off valve hidden behind drywall.
There was absolutely no way to access the valve without demolishing the ceiling.
Annotated photo of framing and plumbing behind a shower where the shower head, manifold and controls, and tub spigot all are directly on top of a stud.
The bathroom tub and shower had been framed such that the showerhead, control manifold, and tub spigot were all on top of a stud!
House framing stud badly burned and deformed by a plumbing blowtorch.
Secondly, as with all the pluming in the house, the flipper sweat the copper in place, burning the stud. In this instance the stud was charred so badly that the fire had burned away a substantial amount of the wood, severely weakening the stud.
Annotated photo showing studs that standard 16 inches apart at the bottom but 20 inches apart at the top, instead of parallel and plumb.
Further demolition revealed that some of the studs were not even plumb!

Month 4 – Begging for Bids

Although dozens of general contractors looked at our house, nearly all of them turned-down the project as it was just too risky. Many contractors do not carry the additional insurance needed to correct another party’s faulty work.

Contractor email reads: Frost, I am sorry for the delayed response but I must pass on your project. I wish you the best. Jeff Edvenson

We needed 3 written estimates before we could begin a legal case. After several months, we finally got bids estimating repairs between $70,000 and $100,000. (Remember, the house was only worth $174,000.)

Month 5 – Hidden Electrical Code Violations

The flipper’s illegal remodeling work continued to surface as demolition continued. Most of the wiring was not attached to framing and the antiquated fuse box was located inside a closet, which is a major fire hazard!

Telephone and cable TV connections covered in globs of drywall mud
When the drywall around it was exposed, we learned that the flipper hid all of the disconnected cable TV, telephone, and low voltage wires behind the paneling and buried them in giant globs of drywall mud.
Junction box that had been concealed by drywall.
This junction box was hidden behind drywall.
Telephone jack orphaned behind drywall
This telephone jack was found orphaned inside the ceiling.
Wires spliced together without a required junction box.
We found dozens of wires spliced together without a junction box…
Junction box that was concealed by ceiling drywall.
…or junction boxes that were covered by drywall, against building code.

More demolition work was needed to continue exposing the problems, so I decided to do it myself.

Partially demolished ceiling with drywall covering junction boxes
As we demolished the ceiling, we found dozens of wire splices without junction boxes, and multiple junction boxes that were illegally covered with drywall.
Junction box that had been hidden behind drywall
We discovered another junction box hidden above the ceiling drywall.
Annotated photo of a demolished ceiling revealing two junction boxes covered by drywall
And two more.
Bathroom fan housing dangling from spliced wires, no junction box.
This bath fan had had no junction box.
Annotated photo showing a bent junction box forced up against a copper pipe without a cover.
And this recessed light had its own attached junction box, but when the flipper installed it above the bathroom ceiling, the box collided with a nearby water pipe. So he removed the box cover cover, and bent the junction box up against the copper pipe until the fixture was forced into place.
Ceiling junction box that had been covered with drywall.
Another ceiling junction box was hidden behind drywall.
Wires illegally spliced without a junction box.
And another electrical splice had no junction box at all.
Wires illegally spliced without wire nuts or junction box.
Another wire splice without a junction box or even wire nuts.
Ceiling junction box used in a wall and covered with drywall.
This ceiling box was improperly used inside wall, and was hidden behind drywall.
Electrical wires pinched between framing and drywall.
In the remodeled kitchen we found electric wires pinched between framing and drywall!
Live wires stuffed under baseboards.
In the basement we found electric wires simply stuffed underneath the baseboards!
Bedroom door that will not shut
As our first winter settled in, new problems surfaced. None of the solid wood doors would close because they wouldn’t fit inside their door frames, indicating that they were installed without the proper clearance.

Month 6 – HVAC Code Violations

Illustrated heat map showing heat outlets that had been improperly cut into the central duct.
The lower level HVAC was completely wrong, with outlets positioned in the middle of the room instead of the perimeter. And the cold air returns were often adjacent to the heating outlets!
Heating duct with large hole cut in it.
The flipper had cut large holes into both the heating ducts and cold air returns!
Heat register installed directly on central heat duct.
And this heating register had been cut directly into the main duct…
Paint stir sticks were used to reduce the size of a hole cut in the central heat duct, and then illegally mount a heat register to it.
…and then framed-in with paint stir sticks and Liquid Nails!
Heating duct boot illegally fashioned out of duct tape.
Instead of using proper heating duct boots, the flipper ignored building codes again, and fashioned them out of wads of duct tape!
Heat register that has been spray painted in place.
What’s more, the heating registers were spray painted in place after installation.
Central heat duct that had drywall screwed directly into it.
I discovered that a closet ceiling that had drywall screwed directly into the heating duct!
Illustrated heat map showing a dining room addition that is starved for heat
Also, our dining room was freezing cold, and there didn’t seem to be any access to the crawlspace beneath it.
Floorplan showing a crawlspace with no visible access.
I suspected that foundation access beneath the dining room had been covered up with drywall, probably in the basement.
Crawlspace access covered with drywall.
So I carefully marked the area to be demolished…
Partial demolition of crawlspace access concealed behind framing and drywall.
…and began removing drywall.
Drywall and framing demolition reveals crawlspace access that had been illegally concealed.
Sure enough, the flipper had sealed up my crawlspace access and hid it behind drywall, completely against building code!
Floorplan showing where crawlspace access had been discovered after being concealed behind drywall.
Crawlspace beneath a dining room addition.
Here is the crawlspace underneath my dining room, which had been starving for heat during the winter months.
Construction debris found in a crawlspace.
The flipper had littered it with construction debris.

Month 7 – Roofing Code Violations

Roofing shingles dumped in an overgrown lawn after an illegal roofing job.
While trying to manage the overgrown lawn in the summer, we discovered roofing shingles strewn about the lawn, killing the sod beneath them.
Roofing shingles found in an overgrown lawn after a roofing job done without a permit.
Without a building permit, the flipper hid roofing problems beneath new shingles, and then simply threw the old shingles into the back yard. We found hundreds of them, every time we did yard work.
Rotten roof sheathing and shingles collapsed when stepped on, as seen from the underside.
Specifically, a large section of new roof sheathing overlapped older, damaged sheathing. Portions of the original sheathing were rotted and caved-in, with its original shingles still visible from the underside!
Illustration showing how eve vents plugged with insulation led to ice dams and roof failure.
Additionally, the flipper plugged the eves with construction debris and insulation, and damaged a ventilation chute that cut off airflow to the attic.
Ice dams forming along a roofline.
When winter came, ice dams formed on the western roof line…
Holding a bucket up to a hole in a bedroom soffit where ice dam melt water is leaking inside.
… and water began leaking through the bedroom ceiling!
Bedroom soffit damage from ice dam melt water.
The damage continued to get worse as melt water seeped in faster and faster…
Sheets of plastic and several buckets catch melt water from ice dam damage to a bedroom soffit.
…until it was steadily streaming into the house.
Shingles damaged by ice dams.
The shingles were badly damaged from the ice dams.
Bats of insulation stuffed into a soffit cut off cold airflow into the attic, causing ice dams.
Inside, demolition of the bedroom soffit revealed that it had been stuffed with insulation, plugging up the eves. The lack of cold air flow to the attic promoted the ice dams.

Yes, one flipper did all of this.

The date stamps on the building materials are consistent with the time the house was being flipped.

Date stamp on roof sheathing indicates that it was manufactured on August 3, 2012.
This date stamp on the new sheathing proved that this was recent work, completed shortly before the home went on the market in late 2012, and only a few months before I bought it. No permit was ever pulled for this work.
Date stamp on carpet padding indicates that it was manufactured on December 27, 2012.
Similarly, this date stamp on some installed carpet padding shows that it was manufactured on December 27, 2012… less than 5 months before I purchased the home.

Additionally, an online description of the property fully admits that the house had a new roof, new windows, new floors, new appliances, and new paint… all of which have documented problems. Again, no permits were ever pulled for any of the remodeling work on the property.

Screenshot of Zillow listing where a flipper admits replacing a roof, but no permit was ever obtained.

Out of Options

After working with multiple litigators, we learned that our real estate laws are set up to favor the sale itself and ensure that a transaction takes place, but they offer no real protection for home buyers. Although we had the option to sue the flipper for real estate fraud, attorney fees were estimated between $30,000-$50,000, and a successful outcome was extremely unlikely. Even if we had those funds available, we decided that they would be better spent simply repairing the house.

  • I was unwilling to ruin my newly-repaired credit by abandoning the house and mortgage.
  • I had no legal avenues to collect damages from the flipper.
  • The house was being threatened with condemnation unless some significant repairs were made by winter.
  • The mortgage had no equity, so I could not get a home equity loan to fund immediate repairs.
  • I was unable to afford additional contractors out of pocket.

Reluctantly, I decided to put my carpentry skills to work and repair the house myself. It took 6 years to repair my home. I desperately worked every single day, sometimes as much as 17 hours per day. Family and friends volunteered a few hours here and there, but largely I was working alone. This routine wore me down physically, mentally, socially, and added to the trauma of being a fraud victim.

Fighting Predatory Remodeling

I am now committed to fighting real estate fraud by strengthening our laws at every level of government to ensure that no one becomes a victim of predatory remodeling ever again.

In the United States, there are examples of federal, state, and local laws that are designed to prevent predatory remodeling and provide recourse for victims. Unfortunately, many of these laws have been continually suspended in an effort to revive the housing market from the 2008 recession, or they are simply deemed not critical to some cities and states. This means that opportunistic real estate investors can still make use of these loopholes, and new home buyers can still become victims.

My goals are:

  • Educate and warn new home buyers about predatory remodeling.
  • Work with local officials to adopt a Point of Sale Inspections for single family homes.
  • Work with state legislators to adopt a bill requiring real estate flippers to be licensed general contractors. This gives victims access to the Contractor Recovery Fund.
  • Work with federal officials to reinstate laws that deny real estate flippers access to federal housing loans.

How You Can Help

  • Please consider sharing this blog to educate others.
  • If you have been a victim of predatory remodeling, please email us your story. The more information we have about this widespread problem, the more reasons lawmakers have to adopt solutions.
  • Be vigilant about construction projects in your neighborhood, and immediately notify your city building inspector of any projects that do not have a permit clearly posted.

My family and I thank you for your continued support through our ordeal. We never saw justice, but we are using this experience to fuel our resolve and keep new home buyers safe from predatory remodeling.

Frost Simula and Amáda Márquez Simula
Frost and Amáda Simula bought their home in Columbia Heights, MN in 2013. They soon discovered that they were victims of predatory remodeling costing more than $100,000. Today, they advocate for home buyer protections and work to end real estate fraud.