Transferring utilities in your buyer's name

I wanted to illustrate the importance of helping buyers call the utility companies at closing to transfer the utility accounts in their name.  Last week, we were at a closing where we represented the buyer as a buyer's agents.  As usual, we called the utility company to request that the account be transferred into the buyer's name only to find out that the seller, who was selling a renovated foreclosure, had been using electricity for approximately 15 months without paying for it.  LIPA indicated that the electricity had not been turned on for some time and would not transfer the account in the buyers' names until an electrical certificate was obtained ensuring it was safe to turn the electricity on.  When we mentioned to them that we did a walkthrough and there was electricity, we were told that the seller's had committed "theft of service".  The sellers bought the house as a foreclosure and jumped the meter to avoid paying electricity to increase their profit.  Needless to say, we closed and held lots of money in escrow.  After an electrician inspected the house it was discovered that approximately $2800 worth of work is needed to bring the service to code and ensure a safe turn on of the electricity.

The buyer had an engineer's inspection prior to signing the contract, but home inspectors are not electricians and are not allowed to opine on situations outside the scope of their inspection.  So, if you are buying a house, especially a foreclosed house that has been renovated, don't forget to have the accounts transferred at closing and don't close if there is a problem and the seller won't hold money in escrow.  LIPA indicated that if the buyers moved in they too would be accused of theft of service!!!