In New Jersey real estate transactions, surprises can surface at the worst possible moment—often just days or weeks before closing. One recent matter our firm handled is a perfect example of how an unpermitted improvement can put an entire deal at risk, and why experienced legal guidance is critical when issues arise.
The Problem: An Unpermitted Conversion Discovered Before Closing
Our client was well on their way to closing when a major issue came to light. Years earlier, a previous owner had converted a garage into a bedroom. While the space looked finished and functional, there was a serious problem: the work had been done without permits.
In New Jersey, this kind of unpermitted alteration is more than a technical oversight. Municipalities require permits to ensure that work complies with building codes, safety standards, and zoning requirements. When a conversion like this is discovered late in the transaction, it can trigger delays, lender concerns, and in some cases, a complete breakdown of the deal.
Here, the unpermitted garage conversion immediately raised red flags. The township would not issue a Certificate of Occupancy (CO)—a document required for many closings, depending on the town —until the issue was resolved. Without a CO, the transaction simply could not move forward.
The Risk: Delays, Denials, and Deal Collapse
Situations like this are stressful for everyone involved. Buyers worry about losing the property. Sellers fear the deal may fall apart or that costly remediation will be required. Agents are caught in the middle trying to keep the transaction alive.
Unpermitted work can lead to:
- Delayed or denied Certificates of Occupancy
- Township fines or penalties
- Required inspections, repairs, or reversals of work
- Lender refusal to fund the loan
- Missed closing dates—or canceled contracts altogether
Left unaddressed or mishandled, these issues can easily derail a closing.
Our Solution: Taking Control and Navigating the Township Process
Our office stepped in immediately and took charge of the situation. Drawing on our experience with New Jersey municipal requirements, we coordinated directly with all parties involved—the client, the listing agent, and the local township.
We worked to:
- Open the necessary permits
- Coordinate required inspections
- Address township concerns efficiently and accurately
- Ensure all documentation was properly submitted and closed
This process required persistence. While the issue caused an unavoidable delay, it was handled methodically and correctly.
The Outcome: Certificate of Occupancy Issued, Closing Saved
Thanks to coordinated efforts and proactive legal guidance, all township requirements were ultimately satisfied. The permits were closed, the Certificate of Occupancy was issued, and the transaction was able to proceed.
Most importantly, our client made it to the closing table with confidence—knowing the property was compliant and the issue had been fully resolved.
The result?
- A saved deal
- A legally compliant property
- A very relieved client
Why This Matters for New Jersey Buyers and Sellers
Unpermitted improvements—garage conversions, finished basements, added bathrooms, decks, or additions—are more common than many people realize. These issues often don’t surface until the final stages of a transaction, when time is tight and emotions are high.
This is where having a knowledgeable New Jersey real estate attorney makes all the difference. Identifying problems early, understanding township requirements, and resolving issues efficiently can be key to keeping your transaction on track.
We Strategize to Handle the Problems
Assisting to navigating permit issues, inspections, and Certificates of Occupancy is what we do best. Whether you are buying or selling a home in New Jersey, we help you anticipate problems, resolve obstacles, and move forward without unnecessary stress.
If you are facing a permit, inspection, or occupancy issue—or want to avoid one altogether—give us a call. We’re here to protect your transaction and get you to the closing table with confidence.