Bank foreclosed on the parcel with house but not the side yard with driveway???

Question

I'm hoping someone can provide some precedence or experience with a foreclosed property I'm in process of buying in Toledo.

The house USED to be one owner, who owned two adjacent parcels...a North lot with the house and half the driveway...a south lot with half the driveway and a side yard (all enclosed by a chain link fence).

So the bank foreclosed on the HOUSE and forgot to do the side yard and it's still in the owner's name.

Of course I can ask the old owner to sell, so long as he's friendly I'm fine buying it from him for a few hundred bucks.

What do I do if the old owner is a pain, wants thousands, or worse refuses to sell and wants to be stupid like drop a fence down the center of the drive?

I'm hoping there is some prior grandfather'd statute that says if a house has had a driveway for 50 yrs and there are two lots and one gets sold but not the other, that the old owner cannot infringe on the use of said driveway.

Hell, I'm hoping that the guy just transfers the thing to me.

I know that I can be nasty too- complain to city when lot isn't mowed, sue him for use of the lot since it has and is an infered contiguous space...still I'd rather not play games.

Anyone have experience with this???

Thanks!

Nevets Luap · Answer

@Andrew Fidler -- if this is in Ohio, check out page 130 of "Modern Real Estate Practice in Ohio" for a description of various easements, if you do not already have one you may be able to get one out of necessity.  And you may need to look into court cases ... this one may help.  https://casetext.com/case/shah-v-smith

Nevets Luap · Answer

@Andrew Fidler -- there may be a clause in the mortgage that was foreclosed that allows the second parcel to be claimed in some capacity even if the parcel wasn't specifically listed.  It is usually the easements appurtenances clause, but it is often general enough that it will say something like "All the right I have in other property as owner of the property ...".  It is sometimes argued that the lesser estate, the adjacent lot with 1/2 the driveway, is merged into the greater estate, when the are under common ownership, and certainly with the driveway going through there you have an argument that it was used as a unified property.  But it isn't a guarantee!  You may need a "quiet title" actiion or a re-foreclosure as mentioned above.

Gregg Gannett · Answer

@Andrew Fidler  also check to see if there is a "Dominant" and "Subordinate" description to the easement between the parcels or any "exclusive or nonexclusive" use as future control or access can potentially be lost during a sale and break up of parcels.

-G

Nevets Luap · Answer

I have a related/very similar question.  A property in Maine comprised of 4 small parcels was merged by ordinance into a single conforming lot.  Then a mortgage, which only had 1 parcel specifically listed in the property description, was foreclosed.  The mortgage did have the standard appurtenance/ interest in other lots clauses though.  The bank only saw three parcels and only sold 3 of the 4.  As new owner, how can you get the fourth parcel back (nobody has conveyed it since foreclosure, it is just sitting there so to speak)?  Can the lots the bank conveyed that were not specifically listed be taken away from the new owner by the owner that was foreclosed on (do they really still own it)?

Gursel Demir · Answer

Hi Andrew,

If you're familiar with such things, pull the previous owners deed, the foreclosed mortgage, and the foreclosure docs.  Compare the legal descriptions in each.

If he owned the other lot, and if it was covered in the mortgage, but not in the foreclosure docs, then whoever did the foreclosure will go back and correct their mistake.

If it was not included in the mortgage, then the mortgagee cannot foreclose it and you can try to make a deal with the previous owner or back out of the deal.

Gursel

Steve Babiak · Answer

@Wayne Brooks - I recently looked at a house where the side lot was not part of the mortgage by intent of the owner.  So for the OP's case, it could have never been part of the collateral, or the lender messed up by omitting if from the foreclosure.  Somebody would have to examine the original mortgage to see what was included as collateral in order to get to the bottom of this.

Bill Gulley · Answer

Ahh, if they had a lien on the other parcel they may foreclose if the debt was not paid from the house, otherwise it needs to be released. The easement still goes with title, problem now is this won't be under adverse possession if the owner is the same person. It's still an encroachment and state law will determine how that will be taken care of, if engress egress is available he may end up having to buy the easement, may if it's not too. I had a very similar issue about 5 years ago, a shared driveway, same owner on both but only one property was secured, the shared driveway survived for use to both parcels. Really depends on how all of that is laid out too.

That is another assumption I didn't see, that may be. :)

Wayne Brooks · Answer

Bill, the OP said the owner "owned two adjacent lots".  I assumed he meant there was a mortgage on both lots, but the foreclosure suit erroneously had the legal description of only one lot.

Andrew Fidler · Answer

Thanks Bill and Wayne-

The FNMA bid website says an accepted offer is in hand, this has to be recent since when we scheduled the walk Sunday (Monday Walk, Tuesday bid) the property was available.

If the bid falls through I will keep BP aprised of the twists and turns, otherwise on to the next deal.

Thank you both for the posts, I appreciate the help!

Bill Gulley · Answer

Bill is. :)

I was going to leave it at that, but the bank foreclosed on the legal description, the property it held as collateral. Established easements run with title to property, a new owner looks back in time as to claims by such easements and use of the property. He needs to investigate to see when the adverse use began and meet state requirements to claim the adjacent property. The adjacent property isn't in the legal description for the collateral, the bank can't foreclose on it if they wanted to, it wasn't conveyed, but if the easement was established prior to foreclosure the easement runs with that title. Question is, was it established? Just continue to use it. See your attorney. The owner may not care or bark about it, someday some future owner could. Best to iron it out now, IMO. :)