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I recently bought a new townhouse in the Greensboro area. The builder has stopped building on the site and has now closed his business. We currently have four permanent residents in the subdivision. Our homes are less than one year old so should still be under the builder’s warranty.

Does the builder have any legal obligations to us? Who honors the warranty? Also, the builder still controlled the homeowners association. Is there no longer an HOA, and do we continue to pay HOA fees? Are we just left “high and dry?” Thanks for any advice.— Distraught Homeowner

Whether you are left “high and dry” depends on several factors. Without question, you should seek the advice of an attorney familiar with real estate disputes.

If your townhouse is well-built, or you resolved all “punch list” items before closing, the express warranty may not matter. You may also still have some warranty protections, depending on what the phrase “closed his business” means. Some builders try to honor warranty claims even after closing. Other builders transfer their assets and responsibilities to another builder. However, if the builder has completely disappeared, warranty claims are unlikely to get addressed.

Even without a warranty, you may have recourse. Claims such as breach of contract and breach of warranty can be pursued through a lawsuit. Though closed, the building company may have assets or insurance to cover such claims. If the builder filed for bankruptcy protection, there will be additional issues that likely will require you to seek the advice of a bankruptcy attorney. You should also see if you are eligible for a claim with the Homeowners Recovery Fund of the N.C. Licensing Board for General Contractors.

The homeowners association will exist regardless of the builder, as long as it was set up properly. An association attorney can advise you on protecting the association’s interests. For instance, the builder’s rights, such as approving construction requests, should be transferred to the HOA.

There may be some initial confusion as to where association dues should be sent. Eventually, however, the dues will almost certainly be owed. Speak with the officers of your association or other homeowners about a neighborhood meeting to discuss such issues.

House Helper answers are provided by area industry professionals and are the opinions of our experts. Triad Homes does not make any representations as to opinions and facts.

If you have a question a Realtor, remodeler, builder or mortgage loan officer can answer, please contact Heather L. Modlin at hmodlin@news-record.com or call 373-7144.

Jim Slaughter is a real estate litigation attorney with the Greensboro law firm of Forman Rossabi Black, PA. He serves as legal counsel to the Greensboro Regional Realtors Association and is the only North Carolina attorney admitted to the College of Community Association Lawyers.