No available water or sewer/septic - existing house

[Bemis Pownall]

r
un
like the wind
and if you cant..
wells are drying up in certain mountain neighborhoods around here and people are using cisterns(SP)
impact on value/marketiblity..well homes are being bought an sold everyday with bad and dry wells.
and is you can RUN!


have a green one

 

[Pamela Crowley (Florida)]

Thanks for all the ideas. Now, I'll throw in the big kicker.

This is a review for the homeowner. The purchase was in November, 1999. The review is being done so that the homeowner can file a complaint against the appraiser plus the seller/investor and original mortgage company. I'm still working on verifying the information in the appraisal but, it does state that the property is on public water and sewer. It appears that there are numerous errors in this appraisal report and the water/sewer is just one of the biggies (six comps that looks like most were investor inflated flips without any mention of the previous repo sale). They have been cut off from the water & septic because the property that has them is being forclosed on, there is no real recourse at this time and no easement or agreement for the use of that well/septic. (That sale of the property with the well/septic in 2000 also appears to be a big time fraud) Homeowner has tried to file a complaint with the state appraisal board, tried to talk to the city, tried to talk to the lender, etc. but, is quite unsophisticated and just doesn't know how to tell them what is really happening. This is looking more and more like a major case of fraud with all parties involved in the sale being part of it.

If this were a pending sale or refinance, I would drop it. Under these current circumstances, I cannot. These people have been financially ruined and now have to move from the house that they also had to spend an additional $10,000 plus to attempt to fix since they bought it. It is going into foreclosure now. By the time I'm finished with this, it will also be sent to the state attorney general. Hidden somewhere in the various 'closing statements' is $1,900 that the homeowner tells me was paid to the appraiser over and above the regular appraisal fee. The difference in the closing statements does come to $1,900. Seems I have a real tiger by the tail and I want this one to be taken down. This is the first chance I've had at this appraiser and I've known about how bad he is for over 5 years.

With these circumstances, I would greatly appreciate further ideas from this forum. I want all the i's dotted and t's crossed and don't want to miss anything that might make a difference. I will be spending some time with the county environmental department tomorrow to get something in writing about the well/septic situation. The whole county was taken over by the City of Jacksonville a few years ago so, there are areas of the 'City' that are actually rural. Some of the splits that were made prior to zoning being enforced were pretty bad. This is one.

 

[Nancy in Friday Harbor]

Pammie,

What is the full, complete legal description of the property. Usually, any easements for water/utilities are detailed in the legal. Does the title company have some responsibility here?

N.

 

[Pamela Crowley (Florida)]

Hi Nancy,

I have the full metes & bounds legal and already know that there are no easements.

City environmental has already told the homeowner that they cannot put a well and septic on their site. I will now talk to them and try to get that in writing.

 

[Chris Harrison]

Pamela, in my area the home owner would have to formally apply for the well and septic. If the application is denied it would be a part of the public record! It would be the first question the attorney would ask if I referenced the home owners being "told" they couldn't have water or sewer access. Also there are several "old" laws on the books about access to water and sewer. Once the access has been given it is VERY dangerous to cut it off without formal hearings and notices. This was made part of the law in this area because of land grabers that would buy the property at the well head or water shed area then cut everyone off to obtain the property at rock bottom prices. Many of these laws are federal from the homestead days.
You may want to have a copy of the last survey to see if they referenced the easement at the division of the parcel. If there is no recent survey for the split, the attorney will have a field day on who is responsible.
Check with prior listings to see what the agent said about the properties water and sewer! That alone could nail this appraiser to the cross!!!
Just my .02
You go girl!
Chris in Utah

 

[Nancy in Friday Harbor]

Pam,

Have been thinking about your challenge and your client's plight since yesterday......hmmmmm.

In addition to all the appraisal stuff, is there a "Consumer Watch/People Helper" reporter at the local TV station? (They're big in the Seattle area -- every station has one.) These people obviously got screwed. I agree with Chris that if a history of water supply has been established over the years, there might be an "adverse possession" situation. I also agree that what you're uncovering should go straight to the attorney general. The $1900 extra to the appraiser is unconscionable.

This is a case where suddenly, you've been thrust into a situation where you're being challenged to become more than an appraiser.

I fully believe that unethical, unscrupulous and fraudulent appraisers ought to be left twisting in the breeze for the vultures--along with the real estate agents and lenders who employ, enable, and encourage them,

BUT

I wonder if we aren't turning a critical corner by making the appraiser responsible for the legality of the water supply.

I consider myself reasonably adept at reading legal descriptions and title reports, but some of the "subject to's" in legals are next to impossible to decipher. We have a lot of shared wells up here and not all of them are written up in the legal description. I have to admit that, on occasion, I have taken the word of the homeowner and/or realtor because the reality of taking the time to got through all the legals (and that means researching each and every one of the documents which make up the "subject to's and any documents referenced therein) and then verifying everything with the county health/environmental resources dept. would result in the production of one appraisal a week or less!!

So (and not to defend this appraiser of yours), there are times when I look at a situation like this water issue and think "There, but for the grace of God, go I". Of course, if someone says it's town water and we're on the other side of the island, I'll know something's fishy, but, by and large, it's not realistic to think that in the scope of a URAR (much less a limited/summary 2055) you can research and verify every single item. That's the reason for the standard assumptions and limiting conditions. The agent has definite responsibility here, as does the seller as does the title company.

Now that I've stirred the pot some, I wish you the best with this difficult assignment. I'll also bet that it's one of those you will voluntarily be undercompensated for -- as you mentioned in a post I read this morning.

Good luck! We're all behind you.

Nancy

 

[Charlotte Dixon]

Oh, Gosh, Pam!!!

Just read your second post. Sorry, I have nothing to add and retract my above post.......Damn, how did you get in to this dear????? All I can say is Good Luck!

Charlotte

 

[Restrain]

Looks like the highest and best use of the site is to sell it to an adjoining property owner since you can't get utilities. By it not having utilities, the property cannot be economically or physically utilized as currently improved. Therefore, the home only has salvage value. So, either the home and lot is sold to the adjacent property owner for a song (same people who get the original foreclosed property) or the home is sold to be moved and the site sold to the adjoining property owner.

So, if you're going to tear up this guy's appraisal, start with an examination of the highest and best use in relation to the disclosed physical facts in the report.

Good Luck.

 

[Richard Carlsen]

Pam, Pam, Pam.... Where do you come up with these?

First of all, if they cannot get sewer and water and cannot put down a well or septic, the question has to be can someone live there? If not, then it looses it's present utility as a single family dwelling and market value goes down faster than Enron stock.

Here you have to go back to Highest and Best Use. If not as a single family dwelling, then perhaps Highest and Best Use is as vacant land, split and attached to the adjoining properties perhaps? And if Highest and Best Use is not as a single family dwelling, forget a 1004 or 2055 since these forms won't work for anything but residential.

Analyze the situation. Don't try to fix it for them. If value has gone away, it is gone.

 

[Pamela Crowley (Florida)]

RStrahan and Richard Carlson,

That is the basic conclusion I had come to when I first posted. You both have given me the answer that I was looking for here.

The properties with the well and septic were split into 6 different properties. One of those 6 has the well, one of the others has the pump house with the electric supply, one of the others actually has a sewer pumping station with a long line to a public sewer. All the necessary components are each located on different properties with no easements or agreements for use by the other properties. All 6 are either foreclosed or in process of foreclosure.

There are 4 single family residential properties that are hooked up to the water well with no easements for that use. 2 of these SFRs have their own septic systems in the front corners of their sites which are far enough from the existing well to be legal. My subject is in between those 2. Those 3 properties back up to the 4th SFR (Property A) where all their water lines to the water well cross that site going to the well. My subject and this 4th property are the ones with a sewer line going to that sewer pumping station.

The city measured and figured that the only property that could feasibly put in a new well with acceptable setbacks was Property A which that owner had installed yesterday. The other 3 properties can hook up to that neighbors new well with easements and agreements. Fine for the water problem for all these properties.

Property A is apparently still hooked up to the sewer pumping station on the duplex properties. The other 2 SFRs have their own legal individual septic systems.

This leaves my subject. They paid for a new line to replace the deteriorated/broken one to the sewer pump station that goes across Property A right after they bought the place and found their sewage backing up. Now, with the new water well on Property A, the city says that they cannot use the sewage line that runs too close to that well. If they want sewage, they will have to pay for a new line to run down the street they are facing, turn and go down the street to the 6 duplex properties, turn and go down the duplex properties street to the sewer station. This would cost quite a few thousand dollars to do this. These homes are in the $50,000 to $70,000 range and the cost to cure is too high. Plus, the owner of Property A now wants to be paid for the use of the new well and split the cost of installing it. That sounds reasonable to me but, my subject owners are tapped out and not only cannot pay for the water and a new line to that new well but, absolutely cannot pay for that new septic line that would be so long.

I posted this for the lesson it can teach all of us. VERIFY the water and sewer situation for your subject properties if there is ANY question at all!!! I would feel very sorry for the original appraiser IF this were the only gross error in his appraisal report - IF he were a good appraiser that just got caught up in a rare error. This situation could take down the best and has scared me as an error too easy to make! As I stated earlier, this is just the biggie error of many, many errors in his appraisal report. This is just the biggie for this one and a huge lesson for us all.