Can you sell a house with unpermitted work?

The short answer

You can sell a house with unpermitted work, but it is not something to hide. Missing permits can come up when the buyer reviews records, during an inspection, during appraisal, or when a lender or title company reviews the file.

Unpermitted work can include a finished basement, added bathroom, room addition, electrical changes, plumbing work, or structural changes done without the permit the local building department required. The bigger the work, the more likely a buyer, appraiser, or city inspector will care about it.

Selling as is can be part of the deal, but it does not make known disclosure issues disappear. If you want a broader look at that topic, see seller disclosure when selling as is.

How unpermitted work can affect a sale

Unpermitted work can affect the buyer's loan. Fannie Mae says that if an appraiser identifies an addition that does not have the required permit, the appraiser must comment on the quality and appearance of the work and its effect on market value, if any. Fannie Mae also says the appraiser and underwriter decide whether there is enough information to support a reliable opinion of value.

FHA treatment depends on the condition of the property. HUD says FHA required repairs should be limited to repairs needed for safety, security, soundness, marketability, and the health and safety of occupants. HUD also says an FHA appraiser may complete an as is appraisal for an existing property when minor deficiencies from deferred maintenance and normal wear and tear do not affect health and safety or the security and soundness of the property.

Title review can also be affected if the permit problem turns into a lien or other title problem. Fannie Mae says it will not purchase or securitize a loan secured by property with an unacceptable title impediment. It also says minor title impediments must not materially affect the marketability of the property.

Local code enforcement can be separate from the sale contract. The City of Columbus says it reviews and investigates possible state and city building code violations, including working without permits and occupying without a certificate of occupancy. If the issue is an open permit rather than work done with no permit, see can you sell a house with open permits.

State disclosure issues in Indiana, Ohio, and Tennessee

Disclosure rules differ by state. The table below sticks to the state sources in the dossier. It does not list every possible local rule, city code, contract term, or court claim.

A disclosure form is not the same as a permit approval. A buyer can still ask for inspections, repairs, credits, permits, price changes, or contract language based on what is found.

First option: check permit records

A practical first step is to check the local permit records for the property. Cities and counties may use their own permit portals or building department records.

Permit records can show whether the work was permitted, whether an inspection was completed, or whether a permit stayed open. If you find an open permit, that is a related but different problem from work done with no permit at all.

A record search may not answer every question. Older work, homeowner work, work done before you owned the house, and records from different agencies can make the picture unclear. That is why buyers often combine record checks with inspections and contract language.

• Look for permits tied to additions, finished basements, decks, garages, bathrooms, kitchens, electrical panels, plumbing, heating and cooling, and structural work.
• Compare the permit record with what is actually in the house.
• Keep copies of permits, approvals, contractor invoices, plans, and inspection notes if you have them.

Second option: ask the building department what can be fixed

The local building department is the place that decides what work needed a permit under local rules. The City of Columbus says it requires permits before work begins as defined in the Columbus Building Code. It also says it investigates work performed without required permits.

Some old work may be reviewed, inspected, corrected, or permitted after the work is already done, depending on local rules and the condition of the work.

This step can create new information. If a city opens an enforcement file, asks for repairs, or requires work to be exposed for inspection, that can affect cost and timing. It can also make the issue clearer for a buyer.

Third option: disclose it, sell as is, or negotiate a fix

Once you know what you know, the safer path is to be clear about it. Indiana's form says the seller states the information is correct to the best of the seller's current actual knowledge. Ohio's form says it does not limit an owner's duty to disclose information required by law or that may exist to preclude fraud by misrepresentation, concealment, or nondisclosure.

The buyer may ask you to get a permit, make repairs, reduce the price, give a credit, or accept a contract condition tied to the work. Tennessee's disclosure law says the sales agreement can control the seller's repair obligations or the buyer's obligation to accept items as is.

Selling as is is one option when the buyer and contract allow it. A cash buyer is also one possible buyer for a house where the seller does not want to complete repairs before closing, but known permit and condition issues should still be disclosed and priced into the deal. You can compare that path with listing in cash offer vs listing agent.

If there are active notices, fines, liens, or city orders, the issue may be closer to a code violation sale than a simple missing permit question. For that related topic, see can you sell a house with code violations.

• Do not advertise permitted living space if you know the added area was not approved as living space.
• Do not cover up missing permits, unsafe wiring, plumbing problems, or structural changes.
• Do not assume an as is clause removes every disclosure duty.

What buyers, appraisers, and lenders may ask for

A buyer may accept the risk, ask for a price change, or ask that the issue be corrected before closing. The answer often depends on the type of work, the buyer's loan, the inspection results, and the local building department's response.

For a conventional loan, Fannie Mae's appraisal guidance matters when the appraiser identifies an addition without the required permit. For an FHA loan, HUD's property standards matter if the condition affects safety, security, soundness, marketability, or occupant health and safety.

The cleanest sale file usually has plain records: what work was done, what permits exist, what permits are missing, what inspections happened, and what the seller knows. Even when the seller chooses to sell as is, that information helps the buyer decide what risk they are accepting.

Frequently asked questions

Sources

Checked against each source on November 14, 2026. This page is general information, not legal or tax advice.

1. Fannie Mae B4-1.3-05, Improvements Section of the Appraisal Report (Fannie Mae)
2. FHA Single Family Housing Policy Handbook 4000.1 (U.S. Department of Housing and Urban Development)
3. Fannie Mae B7-2-05, Title Exceptions and Impediments (Fannie Mae)
4. Building Compliance (City of Columbus, Ohio)
5. Seller's Residential Real Estate Sales Disclosure, State Form 46234 (State of Indiana)
6. Residential Property Disclosure Form (State of Ohio Department of Commerce)
7. 2025 Tennessee Code Bill, Volume 2 (Tennessee General Assembly)