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Home closing question (1 Viewer)

bleachercreacher

Footballguy
We bought an older house in July. The house was built in 1951, so we were expecting the normal issues with our house inspection. All outlets were two prong outlets, that were of course not grounded. As part of our closing agreement, we asked that all outlets be properly grounded, which they agreed to. On final walkthrough, we checked all the outlets with a meter, which read that all were grounded.

We start on a kitchen renovation two weeks ago, and our contractor shows us an issue with the outlets. They had wired the ground to the neutral, which is called bootleg or false ground. The work was performed by a qualified electrician, and from a well respected company in town. When its wired this way, it tricks any meter you stick in the outlet, and the only way to tell is by taking the outlet off for inspection.

We contacted our realtor, and she asked us to write a letter to the seller, explaining the problem. In their response, they said they contacted the master electrician who originally did the work, and he stated that this is how he does the work in older homes. They also talked to another master electrician and the local electrical inspector who both said that this was strictly against code. They're offering to fix the issue by installing GFCI outlets throughout the house. Since our original agreement was for the outlets to be grounded, to which they didn't fight, this is unacceptable to me. They said that it was their final offer with final in caps and underlined.

Is there anyway around going to court in my situation? If we do end up in court, would my closing attorney handle it, or will I be hiring another attorney? I've considered calling the electrician from the company that performed the work, but I seriously doubt he will do anything about it. I've even thought about trying to get the electrical inspector out to look at it, but I didn't pay for the work to be done myself. Thanks.

 
Considering the bold and underline, they made their position clear and need to be sued IMHO from a non-lawyer. Most real estate contract include a clause for attorney's fees so it is likely if you win you will get awarded those too. You might have an attorney draft a letter which estimates which he expects to charge. That might give these people a bit of motivation to fix the issue.

 
GFCI and grounded outlets serve two different purposes (I think). GFCI protects against an electrical device plugged into it, where a grounded outlet protects against a short in the wiring itself.

I would push for the complete grounded wiring of the house. Take them to court if necessary.

You also do not need to add GFCI protection to every outlet. As long as the first outlet, coming from the breaker, has protection, each outlet after that, on the same chain, will be protected.

 
IMO, the electrician did work that was not to code. I believe any new outlets have to be grounded. If my opinion is true (you should be able to find out for sure pretty easily), I'd demand whatever type of fix you want.

 
IMO, the electrician did work that was not to code. I believe any new outlets have to be grounded. If my opinion is true (you should be able to find out for sure pretty easily), I'd demand whatever type of fix you want.
Being to code is an important point, but because it was spelled out in the contract that the outlets must be grounded, it is not even essential. It is a false ground which really only serves to fool inspections.

 
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Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.

 
So you've been in the house for 6+ months. Does this matter at all legally?
According to my realtor, it does not, especially since it was wired with a deceitful method.
It may come down to who is did the deception on who ends up paying for it, the electrician or the sellers. From the sellers response, they were probably aware of it and probably even made the call which way to go. The electrician should never have agreed to do the work that way, regardless.

 
GFCI and grounded outlets serve two different purposes (I think). GFCI protects against an electrical device plugged into it, where a grounded outlet protects against a short in the wiring itself.

I would push for the complete grounded wiring of the house. Take them to court if necessary.

You also do not need to add GFCI protection to every outlet. As long as the first outlet, coming from the breaker, has protection, each outlet after that, on the same chain, will be protected.
Not to hijack this thread, but can't you only put one GFCI outlet on each circuit?

 
GFCI and grounded outlets serve two different purposes (I think). GFCI protects against an electrical device plugged into it, where a grounded outlet protects against a short in the wiring itself.

I would push for the complete grounded wiring of the house. Take them to court if necessary.

You also do not need to add GFCI protection to every outlet. As long as the first outlet, coming from the breaker, has protection, each outlet after that, on the same chain, will be protected.
This is correct, and up to code for fixing homes with older outlets. My biggest issue is that it isn't what I asked for. We could've negotiated when we bought the house, but we can't now. I likely would've offered $10K less if this was their solution at the time.

Our inspector said NM wiring was throughout the house, but couldn't determine if it was 2 or 3 wire NM wiring. I used this to try to determine what it was. Since the fix was as easy as changing the outlets, if the work was done to code, it would've had to have been 3 wire romex, which means newer wiring.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Not nearly as expensive as running a ground to each outlet inside the walls. Which to me, is what he asked for.

 
So you've been in the house for 6+ months. Does this matter at all legally?
According to my realtor, it does not, especially since it was wired with a deceitful method.
It may come down to who is did the deception on who ends up paying for it, the electrician or the sellers. From the sellers response, they were probably aware of it and probably even made the call which way to go. The electrician should never have agreed to do the work that way, regardless.
From their letter, the electrician clearly said that's what they do in older homes. Both the local inspector and another local electrician said it was against code. The seller stated they had no knowledge and actually said they were offended that we thought they may.

 
I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal).
You can find GFCI outlets for 1/3 of that these days. It will be a hell of a lot cheaper for them to install ~20 gfci outlets than it would be to rewire the whole house.

No ####### way I would settle for that.

 
I don't know a ton, but I think a ground and GFCI protect different things.

I guess this was pointed out already.

 
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Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Not nearly as expensive as running a ground to each outlet inside the walls. Which to me, is what he asked for.
Someone more knowledgeable about electrical work than me needs to come in on this about what the actual protection is.

My understanding is the GFCI is more protection. If that is true- who cares what was asked for? If not- then you need to know exactly what the end difference is and is it worth fighting for or not. The real goal here should be coming to agreement while meeting what you want.

Otherwise, just call a lawyer and go to court.

 
I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal).
You can find GFCI outlets for 1/3 of that these days. It will be a hell of a lot cheaper for them to install ~20 gfci outlets than it would be to rewire the whole house.No ####### way I would settle for that.
That's where I am too. I'm going to try to avoid court as much as possible, but from their letter, I don't see them budging. If we go to court, I'll probably install GFCI outlets myself so my family is protected in the mean time. Now, I have to weigh attorney's fees vs fixing the issue myself.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
If it is specifically against code then that is a factor you would want to consider. If not- again, the goal ought to be coming to an agreement to avoid further cost and effort to you as a buyer. If you just want your way because you want your way then call a lawyer and file a lawsuit.

If you want to avoid court. Find out the actual differences between grounding vs GFCI outlets. Then you know how much to dig your heels in. If there is no real difference then you know it is not worth fighting. If there are differences then you can measure how much in terms of cost or desire on your part means you are willing to fight it in court etc.

It really is that simple.

 
So you've been in the house for 6+ months. Does this matter at all legally?
According to my realtor, it does not, especially since it was wired with a deceitful method.
It may come down to who is did the deception on who ends up paying for it, the electrician or the sellers. From the sellers response, they were probably aware of it and probably even made the call which way to go. The electrician should never have agreed to do the work that way, regardless.
From their letter, the electrician clearly said that's what they do in older homes. Both the local inspector and another local electrician said it was against code. The seller stated they had no knowledge and actually said they were offended that we thought they may.
Well it may be on the electrician then. But I doubt their story. You have to take the electrcian and seller to court to discover who is at fault. It could end up the sellers pay the attorney fees and the electrician pays for the rewiring.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.
Seriously.

If you buy a new vehicle and they agree to wash it on Fridays but if they later ask to wash it on Thursdays instead and it works with your schedule- are you really going to cause grief to yourself in fighting them because they agreed to Fridays?

Find out what the real differences are. Then move forward. If there is no difference then why make it matter? If getting your way matters so much to you then call a lawyer and file a lawsuit.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.
That is why I stated in the future. It may very well be OK now, but if that code changes, he is screwed. Get the house fixed as it was agreed.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.
I'm only am amateur electrician, but if the wire was 2 wires, which it sounds like it was, isn't asking for all outlets grounded essentially asking to rewire the entire home?

If that's true, that's not a reasonable condition on buying a home built in the 50's.

 
GFCI and grounded outlets serve two different purposes (I think). GFCI protects against an electrical device plugged into it, where a grounded outlet protects against a short in the wiring itself.

I would push for the complete grounded wiring of the house. Take them to court if necessary.

You also do not need to add GFCI protection to every outlet. As long as the first outlet, coming from the breaker, has protection, each outlet after that, on the same chain, will be protected.
Not to hijack this thread, but can't you only put one GFCI outlet on each circuit?
you can put multiple, but sometimes they will trigger each other and become a PITA.

 
Find out who the seller's realtor's boss is and call that person and tell them your plans to take them to court.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.
I'm only am amateur electrician, but if the wire was 2 wires, which it sounds like it was, isn't asking for all outlets grounded essentially asking to rewire the entire home?

If that's true, that's not a reasonable condition on buying a home built in the 50's.
It probably wasn't. But unfortunately for the sellers that is exactly what they agreed to.

 
Lets say you "get your way" - wouldn't they have to come in and literally tear out walls to replace the wiring? Do you want to go through that for you and your family?

 
They do not have to tear out any walls. The wiring is already there, you "just" need to pull new wire through. I am not an electrician, but the house I am in now had some old knob and tube going to the first floor. I replaced it myself. Not a huge pain in the ###, but not something I would want to do to an entire house

 
GFCI and grounded outlets serve two different purposes (I think). GFCI protects against an electrical device plugged into it, where a grounded outlet protects against a short in the wiring itself.

I would push for the complete grounded wiring of the house. Take them to court if necessary.

You also do not need to add GFCI protection to every outlet. As long as the first outlet, coming from the breaker, has protection, each outlet after that, on the same chain, will be protected.
Not to hijack this thread, but can't you only put one GFCI outlet on each circuit?
You can but it does nothing for you. All you need to do is have a GFCI for the first of the that line and then all following on the line are protected by that GFCI. If you add more then if it gets tripped you are going to have to go to each to figure out which got tripped.

 
Find out who the seller's realtor's boss is and call that person and tell them your plans to take them to court.
I am not sure the point except they have deeper pockets in the form of errors and omission insurance. But I don't see where the realtor is at fault here. I guess they would have to be included in the lawsuit, but I doubt they will have much influence on changing the sellers position.

 
Find out who the seller's realtor's boss is and call that person and tell them your plans to take them to court.
I am not sure the point except they have deeper pockets in the form of errors and omission insurance. But I don't see where the realtor is at fault here. I guess they would have to be included in the lawsuit, but I doubt they will have much influence on changing the sellers position.
Their realtor is the broker at the local remax office. All discussion has gone through him, so he's aware.

 
Lets say you "get your way" - wouldn't they have to come in and literally tear out walls to replace the wiring? Do you want to go through that for you and your family?
They likely can pull the new wire thru the wall. If not, I'd rather my family deal with workers in the house for a week or two instead of having old wiring.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.
I'm only am amateur electrician, but if the wire was 2 wires, which it sounds like it was, isn't asking for all outlets grounded essentially asking to rewire the entire home?

If that's true, that's not a reasonable condition on buying a home built in the 50's.
You are correct, the current wiring is 2 wire. It may not be reasonable, but the seller could've negotiated it in June.

Since I asked them to ground all outlets, and they "did" it so cheaply, the assumption is that there was 3 wire wiring ran, and the ground just wasn't connected. It definitely fooled the electric test meters too.

 
Yea, there is a way to get around court in your situation.... get people to agree to what you want them to agree to.

Beyond that- you are going to go to court.

I would first do research and check on the GFCI first. That is an expensive proposition for them, each of those are about $20 or so plus installing them (which is not a big deal). My understanding is that those would protect you and yours enough. But you may want to check that out. If in the end it does the same protection (actually more I think) then why not agree? Who cares if that was not the original agreement as long as the end result is new plugs that are protected?

You could also see what recourse there may be for bad electrical work. No idea if there is. But I suppose these "Master Electricians" have to be in a union or licensed to say that that they are that. They may only care if there is bad marks that could endanger their livelihood and offer that to the sellers for them to use as leverage if there is. Beyond that, it would be a problem between the seller and electrician.
Who cares? I would. If the GFI does not meet code now or in the future, and it is discovered in home inspection, you will be asked to fix it, which will require completely rewiring the whole house for probably about $20k depending on the size of the house. The cost of a dozen of GFI outlets is a cheap fix which probably is not or will be not up to code.
The GFCI outlets are up to code, but it isn't what was agreed to.
I'm only am amateur electrician, but if the wire was 2 wires, which it sounds like it was, isn't asking for all outlets grounded essentially asking to rewire the entire home?

If that's true, that's not a reasonable condition on buying a home built in the 50's.
You are correct, the current wiring is 2 wire. It may not be reasonable, but the seller could've negotiated it in June.

Since I asked them to ground all outlets, and they "did" it so cheaply, the assumption is that there was 3 wire wiring ran, and the ground just wasn't connected. It definitely fooled the electric test meters too.
They may not have known the extent of the job. They may have asked a contractor, and the contractor said "yea, I can do that easily", and everyone thought that's acceptable. I mean, the house, as is, is legal with two wire ungrounded outlets.

I just have a hard time seeing this stand up in court where the seller will have to rewire your entire home - it seems shockingly unreasonable, regardless of what was agreed to. I think the only ones who make out here will be the lawyers.

ETA - If you want to fall back on "well, they agreed, no matter how unreasonable it really is", they may counter with "well, you signed off on the inspection". In both cases, there's something legal on paper.

 
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How much were closing costs? What other concessions were asked for and granted?

jwb may be right, that a ~$10,000 rewiring job may be unreasonable, but that is what realtors are for - to make sure their clients know what the hell they are signing off on.

 
Whenever I hear about some kind of issue between a new owner and the previous one, it seems like the wisest thing to consider is how much of a hassle this will be when you eventually try and sell the house. Both in time and money. If the "reasonable" solution here means you're going to have to deal with this again even in 30 years, seems like you should be doing whatever is necessary to get this taken care of now.

 
The sellers and the electrician should have kept mum and just asserted, if forced to respond, that they don't know what happened in the home during the last six months. for all they know your wife likes to pull practical jokes involving electrical wiring why you are off to work.

 
Quit being such a ####### baby and take the GFI outlets
#### that ####.

If they didnt agree to rewire the whole house, the deal may have fallen through, or he may have asked for sellers to pay several thousand more dollars in closing costs. No way I let this slide

 
The sellers and the electrician should have kept mum and just asserted, if forced to respond, that they don't know what happened in the home during the last six months. for all they know your wife likes to pull practical jokes involving electrical wiring why you are off to work.
Personally, I wouldn't have responded.

 
How much were closing costs? What other concessions were asked for and granted?

jwb may be right, that a ~$10,000 rewiring job may be unreasonable, but that is what realtors are for - to make sure their clients know what the hell they are signing off on.
Closing cost were $3K, which I believe we paid. There was $800 worth of plumbing work and the electrical work that we asked them to fix. Not a lot of back and forth with the price either, negotiations went really smooth.

 
Interesting that you did not ask them, after inspection, to upgrade the home wiring to meet current code, which language would have been clear, but rather you asked them to address the grounding of the outlets.

Interesting that the problem, or the lack of a correct fix could have, in your words, been discovered not by sticking a meter in the outlet but by undoing a few screws and looking. A simple pre-closing inspection of this essential term would have disclosed the problem while the sellers remedies would perhaps have included not consummating the sale and the reliance costs on both sides of moving.

Were you afforded an opportunity to inspect all work before closing?

 
1. How much money will it cost to get it wired the way you want? Going to court may be worth it, depending on how much we're talking.

2. Is it possible their electrician did this on his own? Usually electricians are licensed - you may have more leverage against him than them, especially if the sellers are saying that they just handed it off to him with instructions to meet the contract.

 
Did you really expect them to rewire every outlet of a 65 year old house? Old wiring, plumbing etc kinda goes with buying a house that old. If you want all new stuff, buy a new house.

 
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