Los Angeles House in REAP? May Be Time to Sell?

(July 9, 2012)

REAP-LA.pngREAP can be devastating to smaller LA homeowners. It may mean it's time to consider selling your LA home. Especially if you have limited cash to do the necessary repairs to get out of it. REAP often begins with a tenant complaint to the LAHD (LA Housing Dept). It can also happen when the LAHD does a routine inspection of your house, duplex, triplex, or fourplex. The LAHD will send you a letter explaining the complaints and the necessary repairs that you must make to close your case.

If you don't make the repairs within the specified time period, LAHD's legal dept. will schedule a hearing. Then a REAP start date will be given to you and your rental income will be reduced (sometimes by half or more). Once in REAP, you will be dealing with inspectors, the health dept, the fire department, and the building and safety dept. Also, your tenants may seek legal advice from lawyers and possibly threaten legal action against you.

To get out of REAP, you must fix all the repairs, get clearance from the LAHD inspectors, and get approval from a City Council hearing. If you are cleared from REAP, it takes another 2-4 months for the final accounting to be completed, at which time the penalties, inspection fees, and legal fees will be deducted from your account.

Is Your LA Home About to Go Into REAP?

If you think your house is going to go into REAP, do whatever you can to get the repairs finished and cleared. REAP is costly, time-consuming, stressful and more. Avoid it at all costs. If you can borrow money to fix the repairs, do it! If you can't, consider selling the property BEFORE it enters REAP. Why? Because the buyer will have to pay all those fees mentioned above. Most buyers don't want to take that burden on.

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Jennifer Shenbaum

Written by Jennifer Shenbaum

Jennifer Shenbaum is a real estate investor based in Southern California. She is a veteran of the housing market crash of 2007. Best of all, she offers free remodeling ideas to all who ask.

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