DEAR BOB: Our neighbor complained that some of our trees and a fence post are on his property. We had a survey done to confirm the boundaries. It differs from the “improvement location certificate” (ILC) our home builder provided to us at the closing. Is it unusual for an actual survey and the builder’s certificate to differ? We hired the same surveyor who did the ILC to mark the boundaries and he said this not unusual –Sue B.
DEAR SUE: It sounds like the licensed surveyor goofed when he surveyed the boundaries for the home builder.
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At the time you purchased your new home, I hope you bought an owner’s title insurance policy that specified the boundaries of your lot. If so, you may have recourse against the title insurer if the actual boundary is substantially different than the builder’s ILC that was provided to you.
If the new survey shows the trees and fence post are on the neighbor’s property, he can then remove the trees and/or fence post if he wishes. The reason is they belong to him. For more details, please consult a local real estate attorney.
QUITCLAIM DEED CONVEYS EVERYTHING, OR NOTHING
DEAR BOB: I am trying to buy a cabin on a beautiful lake. The seller is a cranky old man. We have agreed on the cash price. He says, “Bring me the cash and I’ll give you the quitclaim deed.” Somehow, I don’t feel safe doing this. What protection should I get? –William L.
DEAR WILLIAM: You could be on the trail of a “good deal.” Or that “cranky old man” might be out to swindle you.
A quitclaim deed, presuming it is properly prepared and the grantor’s signature is notarized so the deed can be recorded in the county title records, can convey full fee-simple absolute title. Or, if the old man’s title is defective, you might get nothing.
Your best protection is to have a local real estate attorney or title insurance company check the seller’s title.
If the title is marketable, then insist you receive an owner’s title insurance policy. Arrange to meet the old man at an appropriate place, depending on local custom, such as the attorney’s office, a title company or a local bank, where your cash (a cashier’s check is much safer for you) can be exchanged for the quitclaim deed.
WHAT HAPPENS AFTER FIRST 10 YEARS OF AN INTEREST-ONLY MORTGAGE?
DEAR BOB: You recently discussed the pros and cons of a 10-year interest-only home mortgage. What happens after the 10 years are completed? –Carol G.
DEAR CAROL: There are two types of 10-year interest-only mortgages. After 10 years of interest-only, fully tax-deductible monthly payments, most residential interest-only loans amortize over the next 20 years.
However, some 10-year interest-only mortgages have a balloon payment due in the 10th year, and the full mortgage balance becomes due. Before you sign up for a 10-year interest-only mortgage, be sure you fully understand its terms.
The new Robert Bruss special report, “The 20 Essential Questions Smart Home Buyers Must Ask to Avoid Overpaying in a Buyer’s Market,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant delivery at www.BobBruss.com. Questions for this column are welcome at either address.
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