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How to Address Easements & Encroachments

Written by Posted On Wednesday, 23 July 2014 05:12

One of the most common issues with real estate are boundary disputes. In GA there is no legal requirement for a survey when a property transfers, buyers have a due diligence period and any research must be done in this window of time. While most buyers fail to have a survey completed, there numerous reasons to consider purchasing one, the most obvious is to discover potential encroachments. If an encroachment is found on a survey, there are essentially five options for the parties.easement

The first option is to ignore the encroachment.  If it is de minimis in nature – i.e. the encroachment is so small it is insignificant – it may be best for all parties to ignore the encroachment and close as is.  Keep in mind, without any action the issue will be an exception to the buyer’s title policy.  But if it is de minimis in nature, what difference does that make?

The second option is to remove the encroachment.  First, a word of caution.  If a neighbor’s garage is encroaching onto the subject property, it’s not likely advisable to rent a bulldozer and neatly trim off the portion encroaching.  Sometimes moving the encroaching property is not the best option and sometimes, it is not even available as a choice.  Know that it could potentially be a possibility in certain situations.

The third option is to do an encroachment agreement.  When action is necessary, this is the most common option used.  An encroachment agreement is a license for the seller to keep the encroachment on a neighbor’s property or a seller giving the neighbor a license to keep the neighbor’s encroachment on our property.  Most encroachment agreements have a clause so that they run with the title.  In other words, when the seller signs an encroachment agreement, the buyer will also be a beneficiary of that agreement.  A common question is “Why would a seller sign an agreement to let a neighbor keep the encroachment on our property?”  Sometimes the seller should not.  But there are some benefits.  Namely, in most agreements, the neighbor relinquishes any claim they might have over the subject property.  Otherwise, other factors might suggest that an encroachment agreement protecting the neighbor’s encroachment makes sense.

The fourth option is to do an easement.  An easement is basically an encroachment agreement on steroids.  It gives the parties more rights to the property in question.  It should be reserved for encroachments of increased severity like driveways or important retaining walls.

easementsThe fifth option is to try to do a property swap.  Let’s say Betty Buyer gets a survey and learns that Sam Seller’s pool is in the neighbor’s lot by 50 feet.  Don’t laugh; it happens.  The neighbor could give Sam a deed for the property covered by the pool in return for a piece of property from Sam of an equal acreage.  This should be a last option because it may require homeowner’s association approval, zoning approval, and releases from lenders (among other requirements depending on the municipality, county, homeowners association, or as the situation dictates).  A similar alternative is for Sam to offer to buy the portion of the property but this option too runs into many of the same issues that a property swap does.

The Hank Miller Team always recommends that a survey be completed on any home purchase, issues can be found that would not otherwise be discovered. Ask this builder - Rhode Island Court Rules That $1.8M House Built on Park Must be Removed

- See more at: http://hankmillerteam.com/2014/07/23/how-to-address-encroachments-easements/#sthash.qRJzbVjn.dpuf

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Hank Miller, SRA

Hank Miller is an Associate Broker & Certified Appraiser in the north metro Atlanta area. Since 1989, real estate has been his full time profession. Hank´s clients benefit from his appraisal and sales experience; they act upon data, not baseless opinions. He is an outspoken critic of the lax standards in the agent community.

Hank remains an active certified appraiser and completes specialty work for FNMA, lenders and attorneys. He is a well-known blogger and continues to guest write for multiple industry publications as well as national outlets like the WSJ, NYT, RE Magazine, USA Today and others. He is a regular on public Q&A sites on Zillow, Trulia and many others.

Hank consistently ranks in the top 1% of all agents in the metro Atlanta area. He runs the Hank Miller Team and is known as much for his ability as he is for his opinions. He is especially outspoken about the lack of professional standards and expectations in the real estate industry.


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