DEAR BOB: My grandfather and grandmother died in an auto accident in 1962. Their only child was my mother. When I was a little boy, about age 6, my father died of a heart attack. My mother’s parents were killed about six months earlier. She and I moved into her parents’ home and I happily grew up there. My mother died a few months ago, still living in that house. I am her only child; she never remarried. According to the county records, title to the house is still in the names of my mother’s parents. As far as can be determined, nobody left any wills. I consulted a probate attorney but she said this is too complicated and she didn’t want to get involved. The house is worth around $350,000. As I am the “apparent heir” of the house, what should I do? – Ryan G.

DEAR RYAN: Your situation shows why real estate titles should be cleared promptly. Your mother should have had her parents’ estates probated so she would have held title to the house. That would have made your situation easier.

Purchase Bob Bruss reports online.

Depending on the law of the state where the house is located, it might be necessary to open probate proceedings for the late grandparents. Probate of your late mother’s estate will almost surely be needed because of the title problem and her death intestate without a will.

Perhaps a quiet title lawsuit will be sufficient to transfer title to her estate and then to you by probate. You definitely need to hire a real estate or probate attorney in the community where the house is located to clear up this title mess.


DEAR BOB: I recently read an article about death taxes. As a regular reader, I notice you often recommend living trusts to avoid probate court costs and delays. How do living trusts affect death taxes? – Mary C.

DEAR MARY: Placing title to your home and other major assets into your living trust will avoid probate costs and delays. But living trusts have no effect on avoidance of federal estate taxes and inheritance taxes in the few states that still levy them.

Fortunately, most estates incur no federal estate tax, which now has a $1.5 million exemption for deaths in 2004 and 2005. This exemption increases to $2 million for deaths in 2006, 2007 and 2008.

The primary living trust benefits include (1) avoidance of probate costs and delays, and (2) asset management if the trustor becomes incapacitated, such as by Alzheimer’s disease or a severe stroke. Details are in my special report, “Living Trust Pros and Cons for Avoiding Probate Costs and Delays for Your Heirs,” available for $4 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet download at


DEAR BOB: I enjoy your column every week. Someone said you can only get a $2,000 deductible for your homeowner’s insurance if your mortgage balance is $200,000 or higher. That is not correct. Last June, my husband and I got a mortgage for $174,400 and we bought a homeowner’s insurance policy with a $2,000 deductible. I shopped with several other lenders and insurers. Nobody had any problem with me wanting a $2,000 deductible to save on the insurance premiums – Mary Beth L.

DEAR MARY BETH: Thank you for that information about insurance deductibles. I recently checked with my homeowner’s insurer and learned I would only save about $100 on my annual premium if I increase my deductible from $1,000 to $2,000. My agent recommended leaving my deductible at $1,000.


DEAR BOB: About 25 years ago, my wife and I bought two-acres of bluff top, wooded, oceanfront view property in California with the idea of retiring there someday. The value of the property has greatly increased, but our retirement plans have changed. If we sell this land, can we do an Internal Revenue Code 1031 tax-deferred exchange and buy a rental property such as an apartment or office building with the sales proceeds? – Antonio S.

DEAR ANTONIO: Yes. If the land was held for investment or use in a trade or business, it can qualify for an IRC 1031 tax-deferred exchange for other “like kind” property of equal or greater cost and equity. But “like kind” does not mean “same kind” so you need not trade for other vacant land.

Your situation is ideal for a Starker delayed tax-deferred exchange. Be sure the sales proceeds are held by a qualified third-party intermediary accommodator beyond your constructive receipt.

After the land sale closes, you have 45 days to designate the qualifying replacement property and up to 180 days to complete the acquisition. Full details are available from your tax adviser.


DEAR BOB: My wife and I bought a house almost three years ago. It had an un-permitted dining room. We insisted on including obtaining a building permit as part of the sales terms. But the sellers didn’t comply. We closed the sale anyway and have never heard from the sellers. After almost three years of having an architect draw the addition plans, having an engineer certify the framing, tearing out the drywall and bringing everything up to today’s building code, we got the permit approval and the addition is now legal. The whole process cost us almost $20,000. I want to go after the seller because this was in the escrow instructions. Is there a statute of limitations? – Bill N.

DEAR BILL: The statute of limitations for breach of contract is different in each state. For example, if the home is in California, the statute of limitations is four years. Have you asked the sellers to reimburse you for your costs? A friendly polite letter might bring results or perhaps a settlement offer. You are in a precarious legal situation so be reasonable even if the seller won’t pay the full $20,000.

Before suing the sellers, I suggest you consult a local real estate attorney. Usually the first 30- to 60-minute consultation is free. Bring all your paperwork.

If I were that seller’s attorney, I would argue you waived the condition for getting the addition “legalized” because you completed the home purchase without insisting on a building permit.

Although $20,000 is a lot of money, by the time you hire an attorney and go to trial, you can easily incur thousands of dollars for legal fees with no guarantee of winning.

Even if you obtain a $20,000 judgment against the sellers, then to benefit you have to collect it. If the sellers have substantial real estate assets, you can record your judgment and then wait perhaps many years to collect, if ever.


DEAR BOB: What recourse do we have with our neighbor who planted many trees and plants directly on the property line? There is no fence, but we would like to put one in someday. These trees and bushes are already 3 to 5 feet on our property. The neighbors are not pleasant people, so talking with them only makes them verbally abusive. What can we do? – Concerned.

DEAR CONCERNED: The general rule is a property owner can trim a neighbor’s overhanging trees and bushes back to the property line. However, a rule of reasonableness applies.

That means don’t trim the trees and bushes so severely that they die. Then you could be liable to the neighbor for the lost value of the trees and bushes. For more details, please consult a local real estate attorney.


DEAR BOB: My neighbor recently installed new gutters. The problem is his gutters drain on the public sidewalk and into my garage. He said this is not his problem. Do I have any recourse? – Don R.

DEAR DON: A lower property owner must accept the natural rainwater runoff from an upper property. For example, I live on a hillside and must accept the natural water flow from my uphill neighbor.

If your neighbor channels or directs the water from his property unto your property so that it causes damage, he might be liable. However, if he directs that water toward the street and the slope of the public sidewalk diverts the water into your garage, he might not be liable for that. Before resorting to legal action, try to work out a solution with your neighbor, even if you have to pay for it.

The new Robert Bruss special report, “Everything Homeowners Need to Know About the New $250,000 and $500,000 Home Sale Tax Exemption Rules,” is now available for $4 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his
Real Estate Center


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