Leaky basements can spell big trouble, especially if you want to sell your home. Lying about the problem on disclosure forms or cosmetically covering it up can lead to potentially bigger problems if the new owner discovers that you intentionally deceived her on a home disclosure form. You could face a lawsuit that will make the cost of fixing the problem correctly in the first place seem like a trivial expense. To solve the problem, first discover what is causing the water leakage, then either fix it or sell the house as is, offering an allowance for the problem.
Remove any standing water in the basement, thoroughly dry out the area with fans and then identify the source of the problem. A backed-up sewer drain or water backing into a basement window sill will be easy to spot. Look, too, for obvious things such as clogged gutters on the roof, which leads to improper drainage that can seep into the basement. Gutter downspouts that are not extended far enough can also cause water to pool around the foundation.
Step up your search for the source of the problem if a simple solution cannot be identified. If this is a recurring issue, then think back to the circumstances under which the basement has leaked in the past. Drainage issues can often be fixed by contouring the yard around the foundation or installing a French drain to allow water to flow away from the house. If the issue is something more serious, such as water penetrating the basement walls through a crack, you still may be able to take care of the problem yourself.
Call in an expert for an evaluation and estimate for repairs if you can't address the situation yourself. If water is leaking into the basement where the wall meets the floor, the problem may not be surface water from rain or melting snow. Hydrostatic pressure pushing groundwater in through weak points in joints may be the cause of the leak. A professional should be able to identify this problem. Check your insurance policy to see if you have coverage for this situation.
Search for any hidden damage caused from water leaking into your basement. Once the leakage problem is solved, you should inspect the basement for additional damage. Much of the damage can go unseen, especially if your basement is finished. Mold growing in carpet padding or in walls, structural damage caused by water to drywall and studs, flooring, electrical outlets and damage to cement and foundations from standing water are just a few of the ways that basement flooding creates serious problems.
Determine your best option for selling the home: Pay for the repairs, offer the home "as is," and possibly offering a repair allowance to the new buyer. If you do not have the money to make the repairs, you may have no alternative but to offer an allowance. Be forewarned that buyers may be reluctant to purchase a home with a potentially serious basement problem. Unless your property boasts unique features or a location that overrides the flooding problem, you may face a long time on the market.
Prepare your seller disclosure forms with total honesty. If the problem has been fixed, say so. Keep receipts, engineering reports or any other documentation, including a warranty for the work, so that you can address a buyer's concerns. Make the documentation readily available for inspection along with other information on the house and neighborhood in a "buyer's book" on the kitchen counter. While the burden is on the buyer to prove that you had prior knowledge of the leakage problem, losing a lawsuit is an expensive proposition.