Expensive mistake - wait for the Alta Survey before you order a phase 1

Hello,I learned an expensive lesson this week. My seller took forever to get the Alta survey and I ordered and paid for a phase 1 only to find he has mobile homes completely crossing utility easements. Hopefully someone will read this and avoid the same mistake. Thank you

In older parks this is not unusual. In one of my parks, there are gas lines that run under the homes. This was common back in the day. We are in line to have the gas company re-pipe the park on their dime. So that might be a deal killer, and might not… 

This had gas electric and water in one easement with multiple trailers completely or partially over the easement. 

Jim,Why would they re-pipe it all on their dime? I assume the lines were in first, and then at some point someone moved homes on top without being aware of the easement. In other words, the owner who moved them there was in the wrong (although you’d be the one suffering). Re-piping alone seems expensive, plus it will impact the residents with homes over the current lines, so it seems really weird for them to foot the bill for something hugely expensive that wasn’t their fault. Also on the topic of surveys, does the boundary one usually show the utility easements? In the CD transcripts, Frank mentioned it a bit but talked more about utility lines with ALTA surveys, which he said are far more expensive than just the basic boundary survey and usually unnecessary. But could the boundary one miss an issue like toben’s? Thanks.

A boundary survey rarely shows any utility easements as related to this discussion, so only an ALTA or modified ALTA will get you that level of detail (showing you not only an easement but where the homes are located at in relation to this easement). That being said, crossing over utility easements is not a big deal if you talk to the utility provider and find out the rules. In some areas, you are allowed to cross over the easement as long as you agree to move the home if there is a repair needed in that area by the utility provider. But if the utility provider says that it is forbidden, and you buy the park anyway, you could be in for a lot of trouble when they figure out your transgression.

years ago- they paid out parks with homes over the top of electric lines, gas lines and water lines. It is just the way things were done. Now they fear the gas lines will leak, and the escaping gas will pool under the homes. Because they own the lines, they are looking at places where these risks are and beginning to replace the lines. The owner did not do anything wrong at the time the park was laid out, this is a combination of the utility company replacing lines that are old, and risk assessment. 

So basically the solution to just call all utility companies during due diligence and find out their stance on easement violations? Rather than paying some of the crazy figures you mentioned - $15k+ - for an actual ALTA survey. edit: Ah okay Jim, didn’t realize they thought the older lines were that risky. That definitely makes sense now. Thanks.

We had this problem recently for a park we have owned for a decade – we had to pay the gas company to come out and shut down the entire park gas lines, remove the headers, and we paid to switch over all the homeowners to propane (which involves replacing appliances if they cannot be retrofitted).  It was an expensive lesson – indeed homes are not supposed to be over certain utilities and we did not know about the problem.  In our case, they were not in easements but in public rights-of-way that (although closed for use as MHP) had never been officially dedicated to the park.  In addition, we are dealing with another issue where the sewer easement did not get properly recorded and now the pipes are (may be?) leaking on someone else’s land – the moral of this story is going to be – make sure you know your utility infrastructure from source to sink!Brandon@Sandell