Owner looks to protect investment with encroachment issue
Q : I am a real estate broker who helped my son buy a triplex with an existing consent to encroach with the City of Houston on the advice of a real estate attorney, who advised to proceed with the sale with the existing consent. This consent to encroach was obtained by the second owner of record for a term of 30 years. There are 22 years remaining. The second owner then lost the property through foreclosure. The property later transferred to three different LLCs, an investor in his name, and then to the investor’s LLC who sold it to my son.
After the second owner, none of the subsequent owners applied for a consent in their own name. My son is concerned that he should obtain his own consent to encroach. In your opinion, should he obtain his own consent in his name? Or should he just ride out the remaining 22 years? But then what happens after the 22 years expires? Will the property be at risk? My son wants to protect his investment so any advice you could offer would be greatly appreciated.
A : You have a consent to encroach for 22 more years. After that, I suppose the city could order you to remove the encroachment. As long as the consent has term, you will always have this problem. You may want to talk to the city about making it perpetual.
Q : I am single and want to buy my first home. The bank says I don’t qualify for a loan, but can if my mother cosigns the note. Will she have to take title in her name then?
A : Your bank is making the call here, so they will probably require it. You can each take title to an undivided one-half interest. You also may want to take title as joint tenants to avoid probate. When the co-owner dies the other automatically takes title to the whole tract.
Q : I bought a rental house with a tenant already in it. His lease is now over, but he refuses to leave because I’m raising the rent and he claims the prior owner gave him a lease for life. Now what do I do?
A : Go to your local JP court and tell them you want to evict a tenant. That is your only good remedy, and you don’t have to have a lawyer do it.
Q : I’m 26, recently married, and my wife and I are discussing buying a house. I want to, but she wants to continue to rent. I have always been taught to buy as much as I can, put down as little as possible and leverage myself to prosperity by paying off my own home and getting a tax deduction for the interest payments. My wife says renting is cheaper in the long run. What are your thoughts on this?
A : We’re kind of down the middle. The tax deductions might be legislated away by Congress. Right now rent may be cheap, but you can’t control it and it may go up. We have run the numbers many times, and we are proponents of homeownership. We still like the equity buildup, constancy of the mortgage payments, and the increase in value of a prudently selected home in a good neighborhood. It also gives you a certain level of belonging to a community. Leverage is not a good idea if the market goes down, and it may be cyclical. More and more people are utilizing 15-year loans. You pay off the house a lot quicker, pay a lot less interest, and the increase in mortgage payments between 15 and 30 years is low. Go find a good Realtor and have a long talk about your future plans.
To send us a question visit www.AskGeorge.net and select the “Ask A Question” button. Our answers to questions do not contain legal advice. If you wish to obtain legal advice, you should consult your own attorney. George Stephens is the broker of Stephens Properties. Charles J. Jacobus, J.D. is Board Certified by the Texas Board of Legal Specialization in Residential and Commercial Real Estate Law.