Foreclosure - Half Owned By Bank - Half By Original Owner?
We found a house that is a foreclosure in need of many repairs. The house has an inground pool and the need is mostly cosmetic. The price is right and we were seriously considering it, until we talked to the neighbor.
He said the house was originally owned by the man who owns the property behind the one for sale. This man apparently owns several parcels of land in this area and got into a "dispute" with the bank. Now the bank has foreclosed on the property and the man claims that he still owns half of the backyard, including half of the pool and the well and septic. He claims the new owners will have to fill in the pool and have a new well and septic installed because he still lays claim to the property on which it is located.
First of all, this seems odd to me. Is this scenario possible and how could this happen?
What we are doing is having our realtor produce a survey from the bank showing what they own on record. We also intend to speak to this guy to see if he is intending to cause trouble for anyone wishing to purchase the property.
We would appreciate any input or ideas you have for working through this situation without getting imbroiled in a big legal mess. The house could be beautiful and our intention is to rehab and live in it as our primary residence.
Thank you for any thoughts you may have!
The scenario you laid out is very possible and believable. An owner of multiple adjoining parcels can easily encroach upon adjoining parcels with his improvements.... I have done this myself.
You need to read the legal description of the secured property and walk the property with the survey in hand to see if the septic tank/drainfield or swimming pool was built on the land that is in foreclosure. If you determine that the improvements were built on property not in foreclosure....you have a problem.
Then you would need to buy the additional property or find the least expensive way to disassosciate your property from his.
[addsig]
Thanks, commercialking.
I have spoken to the guy. He seems reasonable enough, but you are right about the survey. Even he is not able to tell me exactly where the property lines are and indicated he would be interested in seeing the survey. I think he may have just been blowing smoke.
So far, the bank is unable to produce a survey. I am getting ready to move forward on having one done. Once the property lines are clear, we are having the county engineers out to determine the well/septic situation and to give us a ballpark estimate.
After all of this is clear and we have some indication on the costs involved, we may present an offer to the bank. There are just too many variables involved to move forward at this point, but we should know more by the end of the week. Wish us luck.
For simple starters just go to the county court house and get a copy of the Plat of Survey. This will give you a good indication where the property lines are. If it looks good to you, then order your own survey.