Shared Driveway - Right of Way Agreement

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Shared Driveway - Right of Way Agreement

Mike McGuire
Kenosha, WI · Member since 2012 · 3 posts · 0 votes

My wife and I purchased a duplex a little over 2 years ago. We live in the lower unit and rent the upper. We knew going in that there was a shared driveway with the single family house next to us. There was no mention of any written agreements (easement, right of way, etc..) in the purchase agreement or deed. In fact, it was never even mentioned by the inspector (other than the condition), lender or title company.

I did some research and was able to find a “Right of Way Agreement” signed by the then owners of the properties back in 1955. The agreement just states that both property owners agree to let the other use the driveway for access to their property. Neither of these parties still own the property in question.

The driveway runs between the houses and is almost all (if not all) on our property. We have never had a formal survey done. There is about a foot of space between the driveway and their house and about 3 feet between our house and the driveway. Once you get past the houses the driveway splits and goes to each of the respectful garages.

The driveway is concrete and in horrible shape. We get along fine with the neighbors and last year I approached them about replacing the driveway. I had an estimate done and it is going to run in excess of $7,000 to replace. They said they were interested in splitting the cost and having it replaced but we would have to talk about it more later (it was just a brief conversation).

Here comes the issue. The neighbors have now split and have both moved out and they are letting the house go into foreclosure. Their house is in very poor condition and is in need of major work. I fear what will happen with the property after foreclosure. I think it will either go for a very low price and the people that buy the house will not be willing to foot the bill for replacement or an investor will buy it as a rental property, again not willing to replace the driveway.

I want to take a preemptive strike and no longer share the driveway, I’m just not sure if I am able to do so. The property next door has room for their own driveway on the other side of the house. There is no agreement between either of the current owners. Is the right of way agreement signed back in 1955 still valid? If I have to pay to replace the entire driveway, I do not want to have the neighbors wear and tear on it. Could I get the current owners to sign an agreement to end the shared driveway since they are leaving anyway?

Here is an image of the driveway.

It's a bit confusing but I wanted to give you an idea of what the situation looks like currently.

Any ideas would be greatly appreciated!

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Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
14y

If your 1955 agreement was properly made it is an easement that runs with title forever unless it is changed by both current owners.
I have similar issues with three properties and I either took care of it myself or just ignored it. If I were you, I'd seriously consider what Ali suggested......buy it!

You might buy the property and squash the old agreement by yourself as you own both properties. You need to talk to an RE attorney for that.

You could throw some paint on it and sell it to one of these wholesale investors to make the major repairs and when you sell, make a proper driveway agreement with maintenance stipulations.

If the current owner has not left town you could get with them to redo the 1955 agreement. If a notice of demand/foreclosure has been made to the owner, there is an issue with their ability to further encumber the property but the bank should thank them for doing so before they leave, so it probably would not be an issue with the bank.

No, you would not be able to buy it with financing and tear it down....unless you wouldhave enough equity in your property to finance the second house with the land included, otherwise you would be destroying the collateral. Tearing down a property usually requires a permit and inspection for dangerous materials (lead, asbestos) and could increase costs of demo.

You might see who is going to take the property, if it's a local bank you might pick up the note by assuming it, (they would just make a new loan for the amount owed and do a sale between you and the neighbor). The bank does not want it! If the lender is out of town, you could talk to them but if it's a secondary market loan it will be more difficult, but the originating lender who made the loan might assist. I think the selling point would be to put the new loan on your property as I mentioned.

When shared well, road, driveway and other shared agreements fail to address how maintenance is to be accomplished and who pays for it, the only recourse is to see the judge and generally it will be court ordered to pay costs equally.

I also saw where you showed an area where another driveway could go. An easement can be denied if there is reasonable ingress/egress and you'd probably get stuck with the bill to accomplish that in the end as the neighbor and future neighbors have the right to use it under that 1955 agreement. There also appears to be some improvement in that proposed driveway area.

To deny the use which may not fly in your area/state, you could fence it off BEFORE the neighbor leaves and they would not object. This would need to be done prior to the property changing hands to defend it against future owners. But you still have that 1955 agreement and you'd have to address that prior to sale as well.

My suggestion, buy it if you can and talk to a RE attorney!

If you don't have RE experience, I'd suggest you get a contractor to look at it and see which would be better, demo or repair it. If it is really that bad it would go pretty cheap as REO.

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  • Ali Young
    Real Estate Investor · Houston, TX · Member since 2012 · 44 posts · 13 votes
    14y

    If you are in a position to purchase the property see if a short sale is an option.

    0Reply
  • Mike McGuire
    OP
    Kenosha, WI · Member since 2012 · 3 posts · 0 votes
    14y

    Hi Ali,
    Thanks for the reply! We've thought about that because we would love to acquire the land to double our lot but the house is in such disrepair that I am not interested. The only thing I would do is tear it down and I don't know if that is allowed by the city and/or lender. We don't currently have the means to buy it outright.

    0Reply
  • Jon Holdman
    Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
    14y

    The property being in foreclosure doesn't change the ownership situation. At this point, even if the driveway is almost completely on your lot, you would lose a adverse possession lawsuit. The other property owners have obviously and continusly used this driveway for many years. Over 50 years, it sounds like. You've done nothing to defend your ownership (fences, no trespassing signs, etc.) If you try to do that now and they choose to challenge you in court, you will almost certainly lose.

    You should see a knowledgeable real estate attorney about what you might be able to do to unwind the sharing.

    0Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    14y

    If your 1955 agreement was properly made it is an easement that runs with title forever unless it is changed by both current owners.
    I have similar issues with three properties and I either took care of it myself or just ignored it. If I were you, I'd seriously consider what Ali suggested......buy it!

    You might buy the property and squash the old agreement by yourself as you own both properties. You need to talk to an RE attorney for that.

    You could throw some paint on it and sell it to one of these wholesale investors to make the major repairs and when you sell, make a proper driveway agreement with maintenance stipulations.

    If the current owner has not left town you could get with them to redo the 1955 agreement. If a notice of demand/foreclosure has been made to the owner, there is an issue with their ability to further encumber the property but the bank should thank them for doing so before they leave, so it probably would not be an issue with the bank.

    No, you would not be able to buy it with financing and tear it down....unless you wouldhave enough equity in your property to finance the second house with the land included, otherwise you would be destroying the collateral. Tearing down a property usually requires a permit and inspection for dangerous materials (lead, asbestos) and could increase costs of demo.

    You might see who is going to take the property, if it's a local bank you might pick up the note by assuming it, (they would just make a new loan for the amount owed and do a sale between you and the neighbor). The bank does not want it! If the lender is out of town, you could talk to them but if it's a secondary market loan it will be more difficult, but the originating lender who made the loan might assist. I think the selling point would be to put the new loan on your property as I mentioned.

    When shared well, road, driveway and other shared agreements fail to address how maintenance is to be accomplished and who pays for it, the only recourse is to see the judge and generally it will be court ordered to pay costs equally.

    I also saw where you showed an area where another driveway could go. An easement can be denied if there is reasonable ingress/egress and you'd probably get stuck with the bill to accomplish that in the end as the neighbor and future neighbors have the right to use it under that 1955 agreement. There also appears to be some improvement in that proposed driveway area.

    To deny the use which may not fly in your area/state, you could fence it off BEFORE the neighbor leaves and they would not object. This would need to be done prior to the property changing hands to defend it against future owners. But you still have that 1955 agreement and you'd have to address that prior to sale as well.

    My suggestion, buy it if you can and talk to a RE attorney!

    If you don't have RE experience, I'd suggest you get a contractor to look at it and see which would be better, demo or repair it. If it is really that bad it would go pretty cheap as REO.

    1Reply
  • Mike McGuire
    OP
    Kenosha, WI · Member since 2012 · 3 posts · 0 votes
    14y

    Thank you both for your reply!

    I just spoke with the owner over the weekend and she sad they are still current on the mortgage and are working with the bank to try and “give it back”. She said that it needs to pass some sort of inspection and by the looks of it, I don’t think it would pass ANY inspection. I’ve never seen the inside (and don’t particularly want to) but I can only imagine what it looks like from the condition of the exterior and what she has told me.

    I think I will reach out to a RE attorney to see what they can suggest. My wife’s father at one time expressed interest in purchasing it as an income property. Maybe we can go that route and tell him he is not welcome to the use of our driveway. I’m sure that will go over well! :) Thanks again!!

    0Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    14y

    I suggest you say nothing to the other owner until you speak to your attorney, you may very well need their cooperation and telling them not to use the driveway might not help! See your attorney and follow the advise, IMO.

    0Reply
  • Andy B.
    Real Estate Attorney · Dallas, TX · Member since 2011 · 124 posts · 29 votes
    14y
    Originally posted by Jon Holdman:
    The property being in foreclosure doesn't change the ownership situation. At this point, even if the driveway is almost completely on your lot, you would lose a adverse possession lawsuit. The other property owners have obviously and continusly used this driveway for many years. Over 50 years, it sounds like. You've done nothing to defend your ownership (fences, no trespassing signs, etc.) If you try to do that now and they choose to challenge you in court, you will almost certainly lose.

    You should see a knowledgeable real estate attorney about what you might be able to do to unwind the sharing.

    There should not be an adverse possession lawsuit in this instance. In most easement cases, adverse possession requires unauthorized use (actual language is usually "open and notorious"). With the 1955 agreement, the use of the drive was not "notorious" it was with permission. You could look at it like a lease -- if you rent a house to someone for 50 years, they do not get to claim adverse possesion of the property.

    0Reply
  • Jon Holdman
    Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
    14y

    If the 1955 agreement is valid and still in effect, then that would cover the sharing. But if Mike McGuire is trying to make the 1955 agreement go away, then adverse possession might come into play. If this agreement didn't exist, then this would appear to be an "open and notorious" usage of the driveway. There was a very similar situation to this here a few years back (without the 1955 agreement.) A homeowner had been walking through a neighboring vacant lot to get to the back of their house. The owner of the lot started the process to build a house and discovered the usage. The homeowner was successful in using adverse possession laws to take a slice of their lot.

    Now, you might be able to argue that, even without the 1955 agreement, that there was understood permission to use the property. It may be possible to withdraw that permission, take full possession of the property up to the property line. Assuming there was sufficient space and no setback issues, the old driveway right up to the property line could be removed and a new one constructed.

    Again, here's where a lawyer would be worth the money. A knowledgable lawyer would be able to tell you want your rights really are.

    0Reply
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