Dwelling straddles property line? Is this an issue?

[Account Closed]

I have a fourplex under contract. FIrst investment property. I found the property card for it and it has remark : "Dwelling straddles adjoining parcel"

Is this something to worry about?

Who do I contact about this?

There is someone actually building a duplex right next door. The buildings are quite close.

pics

Thank you.

[Stephanie P.]

Originally posted by @Account Closed:

Originally posted by @Stephanie P.:

Originally posted by @Account Closed:

Originally posted by @Stephanie P.:

Originally posted by @Account Closed:

Originally posted by @Stephanie P.:

Originally posted by @Account Closed:

I have a fourplex under contract. FIrst investment property. I found the property card for it and it has remark : "Dwelling straddles adjoining parcel"

Is this something to worry about?

Who do I contact about this?

There is someone actually building a duplex right next door. The buildings are quite close.

pics

Thank you.

If the adjoining parcel doesn't convey just walk away.  Even if you do get close to closing, you'll have a clouded title and it probably won't close until the issue is cleared up.  Talk to the title company handling the transaction and ask them what to do.  I've worked with several lenders on similar situations and the loan don't close until they have clear title and they won't have clear title unless the title company insures over the property line issue.  Even then, it may not close.

 I called the assessor.  She said it looks like at some point there was a give take situation between neighbors to fix it.They directed me to an online plat. A survey was done in 2009 when current owners bought and it shows the dwelling within the property boundries. SO I feel better but I guess a survey will clear it up.

 Unfortunately, it's not up to you unless you're paying cash.

If the title company won't insure over the dispute, a lender won't lend on it.  You could pay for a new boundary survey  (could cost a couple thousand dollars), but until then, a mortgage company won't lend on it.  See if the title company will insure over.  It's the only step to take.

 Sorry, I am not quite understanding you on this.

After speaking with the assessor, it appears this was settled some years ago.

The current owners had a survey that checks out and shows the building fully on the parcel. I am ordering a survey regardless. $550

I'm financing it with FHA.

If you're using FHA, you're financing the sale of the property. That means the title company you're going to close the loan with has to prepare a binder and address any encroachments etc...

If there's a cloud on title, meaning something's not quite right, and the title company doesn't  "insure over" or cover that anomaly, then the loan will not go through because without clear title, the lender won't close.  

If you've spoken to the assessor (and it's clear) that's good for your peace of mind, but if the title company you're using doesn't agree with what's been recorded or their abstractor finds some funky information while doing the title search that says that the building doesn't have the appropriate set back or if something is not quite right with the boundaries, you're wasting your time and money because, again, they won't insure over the discrepancy.

If you order a survey, and hand it to the title company that you're going to close the loan with, but that survey has not been recorded, they don't have to use it.  They may just say thank you and order another one from an "approved" surveyor and then expect you to eat the cost.  If there's a boundary dispute or a question of the location of the building, they may make you go deeper than normal and do an actual boundary or location survey.  For $550, you're not getting either.  $550 will get you a deeper dive into existing public records and then they'll draw you a new plat map.  Way different.

Either way, make sure you buy owner's title insurance.

Hope that explains it.  @Tom Gimer  Am I off base here (maybe too cautious and being an alarmist) and did I explain things right?  I'm just  a lender, so maybe I'm missing something too.  Maybe you can help Erik.

Thanks

Stephanie

 OK Thanks for going into more detail. An actual survey is $550, though. Maybe that it's much cheaper in SC than where you are??

Either way, I would guess I'll just have to find out what happens through the process. You are scaring me! But I asked!!!! HAHA

 If it's a boundary or location survey for $550, that's a lot cheaper than up here.

Don't be scared.  You'll be fine.

Best of luck