Shingles causing real estate, financing headaches
Date posted: May 6, 2014
By Tracee Davis
The Sheridan Press
SHERIDAN — Anyone who has bought or sold a house knows the condition of the roof on the structure is something that can make or break a would-be property sale. In Sheridan, real estate transactions are being increasingly complicated if a home has “T-lock” shingles.
This style of shingles, named after their shape and function, has been discontinued by manufacturers.
Local roofer and owner of Knutson Roofing Jeff Knutson said that when T-lock shingles came on the market, they were the best available technology and were renowned for being able to withstand high winds.
“It got to the point where that was the standard,” Knutson said. “I started roofing in 1975, and then, there were two types: organic and fiberglass. The organic was considered to be better quality — it was thicker, and had a 25-year life expectancy. The fiberglass had a 20-year expectancy.”
Knutson said even with the superior wind protection provided by the interlocking, T-shaped shingles, there were some hiccups. For one, they did not come in standardized sizes until the 1980s.
“Another thing that’s a flaw on the T-lock is it must be setting flush on its sheathing. If not, it’s more susceptible to hail damage,” Knutson said, adding that many T-lock roofs in town are starting to show their age, while others have years of life left in them.
The perils of hail damage to roofs are something Sheridan is intimately familiar with after a series of storms last spring that pummeled much of the northern half of town.
The local impact of the discontinuance of T-lock shingles was amplified when dozens of roofs in Sheridan needed replaced. With no more T-lock shingles being manufactured, roofs that might have otherwise needed just a small patch ended up with a total overhaul.
If only one t-lock shingle on a roof is damaged, the entire roof must be replaced, and that problem presents a significant liability to insurance companies. In fact, several insurers have recently started refusing to underwrite a house with the antiquated shingles in place.
“This is an issue that started to surface about three months ago,” Century 21 BHJ Realty Owner Bruce Garber said, adding that the issue is contained to new policies that are taken out in conjunction with a real estate transaction.
“When a new buyer contracts with an insurance agent, I’ve had some clients tell me the insurance company would only partially cover the shingles or do actual cash value. Now, the trend is more and more, they don’t want to provide insurance,” Garber said. “If we can’t get insurance on the house, the buyer can’t get financing.”
The situation creates a scenario where the seller often has to have the roof on the home replaced, even if the T-lock shingles are still functional, before the home can be sold.
Senior Account Manager at Hub International Rose Burns said when home insurance companies don’t outright deny coverage of a property, they’re still taking extra steps to manage the risk.
“They were able to go out in the past, and if three or four shingles were damaged, they could match the roof and do a repair, which was less on their pocketbooks,” Burns explained. “Now, they have to totally replace the roof for qualifying claims.”
Burns said insurance companies that don’t outright deny coverage to a home with T-lock shingles will often charge higher premiums and require a higher deductible.
“It’s a matter of not being able to do a repair, and instead having to do a total replacement,” she said.
While the issue has become prominent in Sheridan because of the prevalence of the type of shingle here, Burns said similar stories are playing out in many communities.
“I believe this is going on nationwide, and if it’s not, it will be soon,” Burns said, adding that companies are not dropping existing policies.
Knutson added that just because new T-lock shingles are not being made doesn’t mean all existing roofs need immediate replacement if the property isn’t changing hands. He said consulting a local, experienced roofer for an inspection can be the first step in determining the effectiveness of existing shingles.
Knutson, along with Garber, offered a cautionary note about consulting newly established roofing businesses in Sheridan.
“Even if they have a local P.O. Box, they’re not really local,” Knutson said, explaining there is still a surge of smaller, less established roofing companies in town because of last year’s hail storms.
Garber indicated many homebuyers and sellers alike are surprised when they hear the type of shingle on a dwelling will complicate a real estate transaction, even if the shingles are in good repair. However, he said with consumer awareness and open communication, the problem is one that can be negotiated with extra care.
“It’s something realtors should be discussing with sellers,” he said, indicating that many first-time homebuyers are asking the roofs be replaced prior to closing or allow the seller to escrow money into the deal so the roof can be fix at their leisure.
“For every property, T-locks are a big blip on the radar right now,” Garber said. “It’s something you can work around, but you need cooperation.”