Private Subdivision Roads with no HOA

[Mr Rex]

I run into this occasionally and just wanted to give everyone a heads up, in case you haven't been made aware. Back in the day, it was a given that if a subdivision streets were built to NC DOT standards that they would be automatically added to the states public roads after either 50 or 75% of the lots were improved. That changed in the early 2000s when the state had some budget issues. So now there are hundreds if not thousands of subdivision streets in NC without a formal road maintenance agreement or HOA. I think it could potentially be an E&O buster. If the streets are not in an incorporated municipality you can look it up on the NC DOT site here: https://apps.ncdot.gov/srlookup/ or call the County NCDOT Maintenance Engineer's office, 1 in each county.

Another must read: https://www.ncrec.gov/Pdfs/genupdate/SubdivStreets2014.pdf

Yesterday I got a panic revision request. Lender, Title Company, Homeowner claiming the subject was not on a private street and there was no need for any type of maintenance agreement etc. I had to break it to them that they had a problem and it was not my problem. They thought because the plat had the streets labeled as "Public" and there was a DOT engineers stamp on the plat indicating that the "design" met DOT standards that it was a public street, but the DOT has never accepted the street into their system, so it is a private street. The 2nd link covers it pretty thoroughly.

 

[glenn walker]

OK first off maybe you are wrong ? Why not just contact the City County Planning department and talk to them, someone is maintaining that street ?

 

[Mr Rex]

Dude, it ain't within 10 miles of an incorporated municipality. There is no one maintaining it. I did contact the NC DOT Engineer to confirm. I researched the Restrictive Covenants and Declarations etc. It happens alot around here. Google WRAL or News and Observer and street maintenance etc. It is no secret but alot of appraisers are sloppy about checking the public box when its not public and do not do any due diligence to determine if there is a mechanism in place for road maintenance.

As an aside but similar, my brother was a local postmaster in a rural area. They put in a great big manufactured home subdivision that had gravel roads that were never installed to DOT standards but the buyers were told that the state would take over as soon as 50% of the lots were sold. No HOA was formed although it was in the Subdivision Declaration Documents required locally to be recorded @ the Register of Deeds. Within a year or so of being installed the roads were almost impassable, so my brother told the residents that they would have to move their mailboxes to the paved public street, because the rural mail carrier kept getting stuck. They raised holy he!! but when he pointed out (with documentation) that the school buses would not venture into the subdivision, they relented. There are a couple around here that I will not drive my car to, I take my 4 x 4 truck and have had to utilize 4 wheel drive more than once.

 

[Hondo]

It is no secret but alot of appraisers are sloppy about checking the public box when its not public and do not do any due diligence to determine if there is a mechanism in place for road maintenance.

This happens here too, I did a new construction condo with private roads CB and got stip from UW to change it to public roads. I had the condo plat that clearly stated "Private Road - not to VDOT standards", sent that to her and the VDOT map that showed private roads. Got a email back from UW "WOW we have closed 11 loans in this complex and all the appraisers have checked public roads." SHM
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[glenn walker]

OK- So there people of the ( Land- You know Morons ) If you now for a fact its not public and maintained then you have to stand your ground. Whats weird is in my area when a property or subdivision is approved the Fire Marshall also is involved in how wide are the streets and they have to be all weather roads where owners have to form an-association to provide for street maintenance , repair, plowing etc. Sounds like someone dropped the ball and a good ambulance chasing attorney may have a great case. My guess is many owners probably;y never had any idea when the purchased the homes and suddenly a guy like you shows up and ruins there new year, because they have a property that nobody will loan on when the appraiser checks the Private Street Box and the owners have no street maintenance agreement, and no money to clean up that Bad-Boy. My first witnesses: Are Fire, Police, USPS, School System, Crying children, Mothers , and a Photo of-90 year old Uncle Billy shaking, because he has not been able to get down to the local Liquor store for over three days because his Toyota Corolla got stuck in the mud, and now he is going into withdrawals, and has to be air lifted to the hospital because the ambulance got stuck in a hole on its way in. The good part is the lender will just get another appraiser who will check the Public Street box and everyone will be happy as clams.

 

[glenn walker]

It is no secret but alot of appraisers are sloppy about checking the public box when its not public and do not do any due diligence to determine if there is a mechanism in place for road maintenance.

This happens here too, I did a new construction condo with private roads CB and got stip from UW to change it to public roads. I had the condo plat that clearly stated "Private Road - not to VDOT standards", sent that to her and the VDOT map that showed private roads. Got a email back from UW "WOW we have closed 11 loans in this complex and all the appraisers have checked public roads." SHM

[/QUOTE]
All our condo projects are located on private streets and they are maintained by the HOA .

 

[Mr Rex]

They get loans all the time. FHA used to require that there had to be a formal Road Maintenance agreement, now its OK as long as there is a recorded access easement and there is adequate access etc. It is a potential for late night Ambulance chasing attorneys, as noted google it. CYA when you know there is an issue is priceless. You can claim the Sargent Schulz defense of I know nothing, then the issue of negligence comes into play. I hardly think the appraisal board or your E&O will buy it. Rots of ruck wid dat.