All Forum Posts by: Todd Handriegh

It appears as though the current owner was able to secure a conventional mortgage with a major bank with the title defect known.  I don't think the title policy actually covered the risk of enforces removal though...it was listed under the exceptions on the policy.  I will update as I learn more.  I'm more optimistic now.

Sorry, I meant that the city forever reserved the right to enforce removal of the structure from the public right of way.   Not the seller.

Working on our first investment property purchase.  We're under contract less than 4 hours so far, working towards closing with a conventional loan.

The property is over 100 years old and has a detached garage that apparently, the back portion of which encroaches onto the public alleyway behind it, and has for many years.  The city is aware of this and is ok with it (I'm not yet sure what kind of certification or permission they've given) but the seller says they will forever reserve the right to take the property back and enforce removal of the structure should they ever need to.

Now in this case, with the alleyway being small and completely surrounded by residential homes built in the early 1900's, the odds are astronomical.  And according to the agent, this happens all the time (but she admittedly deals with cash offers most of the time).

However, this now has me fearing for my deal. 

I'm afraid to ask my lender before they've even seen the purchase contract because what if they refuse to even pre-approve me or accept the purchase contract?

I'm afraid to ask the agent for more information on the previous title history and any endorsements given because she might smell weakness and advise the seller that complications lie ahead...that they should abandon us and seek a cash only buyer.

But mostly, I'm afraid that I could pay for a loan application, an inspection, a loan commitment, and a title search and policy, and then be denied clear title and lose the ability to finance, and of course, lose the deal.

It's hard to imagine that, as frequently as this supposedly occurs with very old properties, that none of them would be allowed to be financed conventionally.

Does anyone have any words of encouragement that will save me some sleep tonight?  Will title insurance cover this if I pay for an endorsement or am I up a creek?

I live in Lockport.  Stay away from Fairmont.

If you don't mind me asking, what makes you target this town?

I know this thread is long-dead but...

I found most if not all of these replies extremely insightful so I thought maybe I should try to add some value.

I'm going to spend some time trying to use realtor.com, trulia, and homes as @Terri Pour-Rastegar suggested and use excel to organize the info...

But I couldn't help but be surprised that the first property's comps I looked at happened to be immediately adjacent to a large field and some woods.  A nice, secluded view you say?

By coincidence, that morning in the Daily Southtown an article was published concerning the sale of that exact field to a large industrial park business, Prologis, who would be installing 5 large warehouses on the property starting next year.

Comps are great...but you need to now what's really going in the the streets.  The town news...the town history...what the residents are talking about.

Easier said than done, of course!