The Dangers and Benefits of Mold in Real Estate Deals

I bought a house with a very leaky roof about the same time I completed a training course on mold rehab and remediation. As luck would have it, Jeanne Townsley-Smith, the teacher of my course and a Certified Mold Remediation Specialist, wanted to make an offer on the house two years earlier when it was still an REO (Real Estate Owned by the bank). But it was a war zone full of mold and priced too high for the condition of the house.

While hearing from Jeanne how moldy the house was two years ago, I wanted to know what was under that fresh coat of paint the bank impressed me with when I bought the house. Was it a cover up? What did I really buy? Jeanne and I were both curious to see how bad the "hidden mold" had become.

From Jeanne, I learned mold can be both beneficial and dangerous. I learned mold is necessary to fight bacteria, but it can be hidden well enough that it makes people sick without their knowledge. Although some types of mold only agitate allergies, other types can be toxic to humans and pets. The toxic molds that are commonly found in houses that have had water damage can cause serious health problems.

Mold can also be visible enough to scare away buyers, renters or lending companies for potential investors. Although I didn't see any mold when I purchased my house with a leaky roof, I wanted to know if my house contained the hidden version.

Jeanne and I decided we would have a mold rehab training class in my new house. During a six-hour training course, Jeanne and her partner, Mark Murrison, armed us with all the personal protective equipment we needed: tyvek suits, goggles, gloves and respirators.

The students and I didn't think we would find much mold as we started removing the drywall from the kitchen ceiling. We were wrong. The exposed back side of the drywall was covered in black and gray mold, mold that been feasting on the paper backing!

As a result of our discovery from the ceiling, Jeanne wanted to remove the kitchen cabinets because possible mold growth and damage might be hidden behind the cabinets, the wall and the plumbing. I thought the cabinets were worth keeping until I saw what was behind them: water marks and mold six to eight inches high around the entire perimeter on the back of every cabinet.

Even though the drywall behind the cabinets didn't have much visible mold, we removed it anyway. They were WORSE! We discovered that the condensation line from the AC had been draining on the floor for many years. The water that laid there was wicked into the drywall. When it never dried out, mold grew. And grew and grew. It grew three to four feet high on the drywall.

And the bank painted over it!

An unsuspecting family that might have liked the kitchen cabinets would probably never have known...until they couldn't breathe.

Now that we uncovered the mold, we had to clean it up. But not with bleach. Bleach actually wipes the head of mold off and bleaches it white. When it's white, you can't see it anymore. Only it can still reproduce and make it hard for you to breathe.

The mold infestation in the kitchen made me wary of the rest of the house, especially the bathroom. It had been completely remodeled by the bank before the sale. They installed a new vanity, toilet and tub with surround. The bathroom, as well as the whole house, was freshly painted. But what was this paint covering up? Only removing the drywall in the bathroom will reveal the answer.

Morals of the story: 1) If you buy a house with a mold problem, use it to get an even deeper discount. 2) Suspect freshly painted houses by the bank. 3) Get trained by Jeanne at the Mold Institute Protocol Training Institute.

Deb McMillan, OPHP, CMI, is a real estate investor and writer, living in Hamilton, Ohio, and has written a home study course on Short Sale Success Systems detailing how to get deep discounts from the bank when buying pre-foreclosures. She teaches about bankruptcy and what you can and can't do once a homeowner files. Log on to http://www.shortsalesqueen.com for more information on how to make your deals close