Public Or Private Road

[BENNY JEFFUS]

Plat indicates roads dedicated to the public. County has not accepted roads and does not maintain roads. Property lines stop at road easement. Are roads public or private? On 1004 we check box Public or Private. On FHA vc sheet we check box indicating property accessible only by a private road or drive. What say all?

 

[Mike Garrett RAA]

Until accepted by the country for maintenance the roads are considered private. The lender will want to know if there is a road maintenance agreement, who is responsible, and what are the fees.

 

[BENNY JEFFUS]

MIKE, Thanks for your reply. The county has faxed me a statement that the county recognizes the road as public and is under public ownership. Although they do not maintain it and that a fence or gate could not be placed across the road. Do you still consider it a private road.

 

[Mike Garrett RAA]

It is the maintenance of the road that the lender is concerned with...not the ownership. I repeat, if it is not "publicly maintained", treat it as a private road and check into a road maintenance agreement.

 

[Randy Beigh]

Benny

If it is a private road, somebody owns. That means there is a legal description. If the county owns, this may not be an issue. If the county says they own, then it's public.

Check public, but if it is up to the owners to maintain it, then describe and discuss road maintenance agreements. Follow FHA guidelines whatever that may be.

 

[Pat Butler]

This is one of the limitations of form reporting. I'd put an asterisk in both boxes and simply explain the situation like you did here. Sometimes, you can't neatly categorize certain factors of a property as clearly as a check box on a form would indicate.

 

[Richard Carlsen]

Maintenance is the question you need to address. Ask the HO if he has a Private Road Maintenance Agreement in place. If he say yes, ask for a copy it you must see it. Or you can just say that one exists per the HO. If he says no, then report that the subject is on a private road; no known private road maintenance agreement. Let the UW worry if one is required and getting one put in place. Such agreements are not mandatory for making a loan in our market. Only FHA makes the existence of a private road maintenance agreement an issue.

Make sure you address if the private road location inhibits normal marketability. Typically, they do not. At least not that I can measure in my market.