Right of way for foreclosure property

9 Replies

There is a foreclosure property, and the owner signed the right-of-way agreement with the pipeline company last year to allow the pipeline company to install the pipeline on the property. If I buy the property at the foreclosure sale. Do i need to honor right-of-way agreement? Can i re-negotiate the term?

*I am not a lawyer*

I don't see why this would prompt a cancellation of the contract. If that was the case any time a house was sold the new owner could force a renegotiation.

@Khanh Tran Review the recorded r/w agreement. It could be for a term of years or forever ... but either way it should run with the land and would therefore be binding on future owners such as yourself. 

You could conceivably renegotiate terms after the purchase with other affected parties (unlikely) but unilateral cancellation is not happening. 

hey Tom I'm new to the whole real estate investing but it would be greatly appreciated if you could explain the process you go through when It comes to finding pre/foreclosed property and being able to get it under contract to sell to a buyer? please and thank you.

@Tom Gimer : It's hard to find out the term. The agreement only mentioned about 10$ and other valuable consideration. The right-of-way agreement for construction is only for 2 years. But, it is permanent easement & right of way.

Originally posted by @Khanh Tran :

@Tom Gimer: It's hard to find out the term. The agreement only mentioned about 10$ and other valuable consideration. The right-of-way agreement for construction is only for 2 years. But, it is permanent easement & right of way.

OK well you answered the question... it's permanent. So a pipe presumably gets buried in the easement area and the vendor/successors retain the right to enter upon that area (the dimensions of this area should be spelled out in the agreement) in order to repair and maintain the pipeline, and you can't build on top of that area. Deal breaker?

Tran,
I am a ROW Agent for a pipeline company. The easement, even though the pipe isn’t in the ground yet, is legally binding. If you don’t have a copy you should be able to get it at the county clerk’s office for the county you are in. It should have a plat attached showing the specifics of the easement. If they recorded a Memorandum of Easement, it will still have the plat, but you should be able to get a copy of the full easement from the pipeline company, or prior owner or their attorney (assuming they’ll work with you).

As to damages, they were probably paid in one lump sum at the time the easement was acquired, however you may be able to work with the company on actual damages like crop loss, grazing loss, or reseeding the easement. If not that, then you may be able to get a little bit of sidework, new road base for a road, new gates, etc.

In the end this is really dependent on the guy you’re working with. Most of us understand how crappy that would be for you, and would want to do a little something within our power, but ultimately the management group can squash that or work with you. Good luck!