Your Mortgage View

Your Mortgage View | November 13, 2017

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Bad Neighbors Can Cost You

Buying a home is one of the biggest investment any person will make in their lifetime. But how often do potential buyers do as much due diligence on their next-door neighbors as they do with, say, the decor in the bathroom or square footage in the yard?

Some 25% of home buyers said they regret not asking about their neighbors, while 30% said they wish they’d looked into the local sex offender database, according to a survey of 2,000 homeowners by mortgage-information site HSH.com.

Only 16% regretted that their home was too small. But roughly 40% of people said they’ve argued with their neighbor over noise, parking, kids, pets, danger to property and other landscaping issues, according to a separate survey of 3,000 people by real-estate site Homes.com released last year.

An annual online poll has ranked noise as No. 1 year after year. That includes barking dogs, loud music, car and house alarms and domestic arguments.

Barry Covert, a lawyer, based in Buffalo, N.Y., recommends people research potential neighbors’ Facebook accounts, talk to local police, visit corner stores and local laundry services, and knock on the neighbor’s front door and find out for yourself. These steps make financial sense. And check online sex offender registries too: One study by Longwood College and Longwood University in Virginia said that registered sex offenders living nearby can reduce a home’s value by 9%, and homes near registered sex offenders can take 70% longer to sell.

Make sure the property line in the deeds of your future home matches with the actual property line, said Robert W. Zierman, a lawyer in Seattle. Few homeowners have heard of “adverse possession,” but it is the legal grounds on which a neighbor can claim “continuous, exclusive, open and notorious” use of your land if he or she has done so for a period of time. If there has been unlawful use of land for many years, the neighbor may be able to claim ownership in some states. Ask the seller for a written disclosure of all issues presented by neighbors over the years, Borzotta said And the problem isn’t always next door. “We who consider ourselves good neighbors need to realize we’re not perfect,” he said, “and that introspection, maturity and dignity are the best ways with which to handle neighbor conflicts as they arise.”

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Mortgage rates are trending sideways today. Last week the MBS market worsened by -47bps. This was enough to worsen mortgage rates or fees. Mortgage rates were fairly volatile last week.


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