"When Your Biggest Investment Is Now Worthless, It's Devastating" - Homes In Connecticut Are Literally Crumbling

"You can't eat, you can't sleep. When you're told your home is now worthless and your biggest investment is now worthless, it's devastating" - This is how Tim Heim, a homeowner in northeastern Connecticut describes the feeling when you're told the concrete foundation of your home is crumbling, and your house is gradually collapsing.

Sadly, this is exactly what thousands of homeowners are being told across nearly 20 towns in northeastern Connecticut. The problem has been traced back to foundations which used materials from a specific quarry and related concrete maker since the 1980's.

From the NYT

The scope of the problem is so vast that state officials have begun an investigation, and they recently announced that the crumbling foundations had been traced to a quarry business and a related concrete maker, which have agreed to stop selling their products for residential use. The stone aggregate used in the concrete mixture has high levels of pyrrhotite, an iron sulfide mineral that can react with oxygen and water to cause swelling and cracking. Over the past 30 years, the quarry has provided concrete for as many as 20,000 houses.

The governor directed the Consumer Protection Department and attorney general to investigate possible wrongdoing, determine the scope of the problem, and determine what assistance was available for homeowners. As mentioned above, while the state has traced the problem to a specific quarry and concrete maker, there doesn't seem to be any further reports of failed concrete at other projects that used those materials. A spokesman for both companies has attributed the crumbling foundations to improper installation, noting that it was a tendency of some contractors to add water to the wet concrete to make it pour faster. However, the mineral pyrrhotite was identified as a culprit in disintegrating foundations elsewhere, for example in the province of Quebec, in which PM Justin Trudeau pledged to allot $30 million in aid to homeowners whose foundations were failing.

A measure similar to that has failed so far in Connecticut. Republican state senator Tony Guglielmo proposed a $50 million bond to help homeowners but Democrats in the State House rejected it, arguing that such a measure should wait until the full extent of the problem is understood.

The toughest part for homeowners, aside from the emotional roller coaster, is that insurers are refusing to pay for repairs, referencing the word "abrupt" in policy language. Repairing the homes requires replacing the entire foundation which costs anywhere from $100,000 to over $200,000 according to the NYT.

Insurers have generally refused to pay for repairs, strictly defining the coverage of collapse by inserting the word “abrupt” in policy language. Repairing the homes requires replacing the entire foundation at costs that typically range from $100,000 to over $200,000. So far, 223 residents have filed formal complaints about crumbling foundations with the department, but officials believe many homeowners may be reluctant to contact the state, fearing problems from their banks and insurers.

The state's Insurance Department did step in however, if only to provide slight relief, and warned insurers not to cancel policies due to the foundation's condition. It won't help with the concrete problem, but should help prevent homeowners fro losing insurance protection all together. Lawmakers also passed a bill that would allow homeowners with the crumbling foundations receive a reassessment of property values, and requires contractors to record the supplier of concrete for residential foundations.

Families that are being impacted are mostly working middle-class families who face financial ruin since their homes represent the biggest part of their nest egg, not to mention the day-to-day expenses of some homeowners having to move out of their crumbling homes due to them being unsafe to live.

Sandra Miller had to rent a nearby condominium after she was told it was no longer safe for her family to live in the home. Miller said she couldn't pay both monthly rent and a mortgage, let alone the hundreds of thousands it would take to repair the foundation. "I don't know too many people that have $170,000 in their wallet, and that's what it's going to cost to fix my home."

A class action lawsuit has been filed by Connecticut homeowners accusing insurers of a "concerted scheme" to deny coverage. The homeowner who started the coalition, Tim Heim, faults state officials for ignoring warnings from a number of homeowners with the problem in the early 200s. In 2003, a meeting was held in Hartford among lawmakers, homeowners, and representatives of the attorney general's office and Consumer Protection Department - nothing came of it.

"They had the power to stop this problem, and they chose not to." Heim Said.

Fifteen years ago, Linda Tofolowski and her husband filed a formal complaint with the Consumer Protection department against J.J. Mottes, the company that supplied the concrete to their home, detailing the cracks that had formed in the foundation of their home in the mid-1990s. The couple also sued J.J. Mottes in 1995 and lost.

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Sadly this reminds us about the "new" apartment buildings in China where the concrete walls crumble like sand, and just like in China it appears as these homes in Connecticut will be worthless over time as well. People's largest asset, just crumbling beneath their feet, and just like that, the appearance of a safe nest egg for the future, has disappeared.

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