Paul Fisette, director of building materials and wood technology at the University of Massachusetts in Amherst, replies: The best waterproofing methods are those that address water leakage at exterior surfaces of the foundation. Ideally, moisture protection is achieved through the combination of controlled surface runoff, applied foundation damp-proofing, effective subsurface soil drainage, and the installation of an effective perimeter drainage system. The bad news is that you don’t know what has been done on the outside of the foundation below grade; and re-excavating the perimeter of the foundation to inspect and/or install the appropriate moistureproofing and drainage would be costly. The good news is that you still can take some steps to improve your chances of having a dry finished basement.
On the outside, start by installing roof gutters connected to downspouts and leaders that direct water at least 10 ft. away from the house. Install a layer of clay around the perimeter of the building beneath the topsoil to limit water penetration, and then grade the soil around the perimeter of the house with a positive slope leading water away.
On the inside, apply damp-proofing to the surface of the foundation wall. Products like Sto Watertight Coat (www.stocorp.com) can provide an important layer of moisture protection. I’ve had good luck with the Sto Watertight Coat. It has a low permeance, or perm, rating (about 1.2) and a good track record for holding back liquid water in commercial applications. Be sure that the coating you choose is low perm (around 1 perm). This product will minimize diffusion from the soil through the foundation.
The problem with applying moistureproofing coatings on the inside, though, is that the damp-proofing product will be under negative pressure. Any water trying to leak in literally will be pushing the coating off the wall (damp-proofing applied to the exterior is on the positive pressure side). The success of the product depends on how well it adheres to the wall. Remember that these coatings are not elastic. They also are unable to bridge any cracks that develop in the foundation walls.
If you want to finish the basement to create living space, you can attach a layer of foam insulation directly to the inside surface of the foundation (after the interior damp-proofing is applied and cured). Tape the seams of the insulation, and seal all edges of the foam panels to prevent air from reaching the cold foundation, which will cause condensation. Then build an uninsulated wood-frame wall spaced away from the foundation. It will be simple to run the plumbing and electrical lines through an uninsulated wall, and the frame should remain above dew-point temperature, reducing the likelihood that condensation will form in the wall.