Whether or not you need a permit to finish a basement depends on the scale of the renovations and the laws in your area. Generally, cosmetic changes, like a new coat of paint or fixture installations, won’t require a permit. Whereas larger finishings like wall demolition, electrical changes, or any change to heating, ventilation, and plumbing may require a permit.

For many homeowners, the potential for a rec room, home office, or entertainment cave is too tempting to pass up. But before you try your hand at electrical wiring, you’re going to have to jump through a few hoops.

Depending on the scale of your operation, you may need a permit from the city to turn your unfinished basement into a cozy, functional part of your home.

Lucky for you, the car and

home insurance

super app

Jerry

has compiled information on permits so you don’t have to! In this article, we’ll cover when you need to get a permit to finish your basement, what happens if you don’t, and the impact finishing a basement can have on your

home insurance

Let Jerry find you the best homeowners insurance policy for your needs

* checking your rate won’t affect your credit score

Shop Now

* checking your rate won’t affect your credit score

Do I need a permit to finish my basement?

In short—probably, yes. But it depends on the scale of your project. Do you want to redo your floors? Are you adding or removing a wall? What about plumbing and lighting fixtures?

Typically, any changes to electrical work, heating, ventilation, and air conditioning will require a permit to complete. The same goes for plumbing and wall demolition, so if you’re planning to add or remove walls in your basement or put in a bathroom, you’ll likely need a permit. This includes adding drywall to previously existing framing.

On top of a permit, you’ll need to submit your architectural plans to the Department of Buildings (DOB). That way the city is up to date on the zoning of your house for taxing and insurance purposes.

You can get around the hassle of acquiring permits by hiring a contractor to help with your project. Permits are a contractor’s bread and butter, so they can take you through the legal process without much legwork on your end.

MORE:

Does home insurance cover flooded basements?

Can you finish a basement without a permit?

Sometimes—it depends on the scale of your project.

If your definition of “finishing” is mostly cosmetic, like painting, adding flooring or carpeting, or changing existing lighting and plumbing fixtures, you probably won’t need a permit. However, it’s still a good idea to brush up on your area’s permit laws for finishing and remodels.

When is it illegal to finish a basement without a permit?

If you bypass the permit process for structural or electrical changes to your basement, you could be breaking your city’s bylaws. Bylaws are ordinances meant to ensure safe building practices and are generally enforced by your municipality, not by law enforcement. Breaking bylaws can result in penalties or misdemeanor charges by the city.

What are the consequences of finishing a basement without a permit?

While you can’t be arrested for breaking bylaws, finishing your basement without a permit can have consequences for your home, your insurance, and your wallet. Here are some of the possible consequences of finishing a basement without a permit.

Removal of completed work

If you’ve already finished your basement when the city finds out, they may require you to remove the work you did without permission.

Fines

Sometimes you can avoid removing completed work by paying a fine, but these fines can be hefty. On top of a fine, first-time offenders can usually file for a retroactive permit for completed work, but you must still be approved for the permit and pass all necessary site inspections.

Reduced home value

Without a proper inspection, you won’t have a second opinion to ensure the work in your basement is up to code. Additionally, any work you’ve done without permission will make it difficult to sell your house in the future. Potential buyers may ask their agent or lawyer to pull up permits from your home. If they don’t find any for your finished basement, you’re in trouble.

Insurance issues

Any work you do without a permit won’t be covered by your insurance. That means if anything happens to your basement and you need repairs, you’ll have to pay out of pocket. Your provider might also raise your insurance rates or drop you as a customer altogether if they know there are any unpermitted, potentially unsafe renovations in the house.

Tax increases

If you’re found to have finished your basement without a permit, the city will require you to pay back taxes on any work you’ve done. The longer you go without getting a retroactive permit for your basement finishing, the more you’ll owe.

MORE:

How to bundle home and auto insurance to save money

How does a basement renovation impact home insurance?

As with any project that adds value to your home, finishing or remodeling your basement can raise your insurance rates. If your new entertainment cave with a half bath adds $20,000 to your home value, your insurance will have to be adjusted appropriately.

It’s also important to adjust your insurance so that you have full coverage. You’ll want your basement to be covered for things like

flooding

, bellied pipes, etc. to make sure you’re in the clear if anything happens to your property.

Talk to your insurance agent to make sure you're covered for your new basement remodel. Your agent can get you the best deals for your budget while also ensuring full coverage for your home.

MORE:

Does homeowners insurance cover bellied pipes?

How to find affordable home insurance

Covering all the bases as a homeowner can be complex—but that doesn't mean your insurance has to be!

You can make sure you’re getting the best bang for your buck with

Jerry

, the

insurance super app

Just download the app, answer a few questions, and get the

cheapest quotes

in seconds with Jerry, the highest-rated insurance app across all platforms. The best part? The average Jerry user saves $887 a year on car insurance.

“WOW.
Jerry
has been so easy to use. I called a representative when I wanted some clarification, and they walked me through the entire process of finding a new rate for full coverage on my luxury vehicle.” —Beth G.

RECOMMENDED