DEAR BOB: I know you frequently recommend interviewing at least three real estate agents before selecting the best one to list a house for sale. But in our neighborhood, about 75 percent of the houses are sold through one real estate brokerage. Should we ask this agency to send us three agents to interview, or should we ask this large agency and two smaller agencies to send agents to interview?--Ed F.

DEAR ED: Three agents from the same brokerage will probably give you similar listing presentations and market value opinions. Instead, interview agents from at least three different firms. Each agent should give you a written comparative market analysis and marketing plan for your home. By comparing at least three agents from three different firms, you will be able to decide which agent and brokerage will be best for you.

Ask friends, neighbors and business associates to recommend agents to interview. A personal recommendation is far better than "cold calling" a real estate brokerage.

DEAR BOB: During my neighbor's recent remodeling, we learned his sewer line crosses over my property and ties into my line, which then continues on my property to the street. His water line also is on my property, although his meter is on his property. I am concerned about damage to my property if the sewer or water line breaks. Should I require him to move these lines to his property?--Bob L.

DEAR BOB: Check your title insurance policy to see what it says about recorded utility easements over your property. If the sewer and water lines are within the easement area, you can't force your neighbor to relocate them to his property.

For example, my property has a recorded city sewer line easement along the boundary from my neighbor's property. The city is responsible for that sewer line's maintenance. You may have a similar situation.

DEAR BOB: My husband defaulted on a condominium financed with an FHA mortgage. The condo was repossessed and sold for half ($27,000) of what was owed on its FHA loan ($54,000). He paid the FHA insurance premiums for all the years he owned the condo. What does this insurance cover? How much can FHA sue him for? I have contacted a real estate attorney, but he isn't much help. I haven't been able to find much information at the library. Please explain.--Lorna F.

DEAR LORNA: FHA mortgage insurance protects the lender, not the borrower. Yes, the borrower pays the FHA insurance premiums, but the lender benefits if the borrower defaults and there is a loss on the loan.

FHA insurance pays off the insured lender's loss, if any. Then FHA has the option, but not the requirement, of going after the defaulting borrower for its loss. Even in states with anti-deficiency laws, the FHA can and does seek deficiencies because federal, not state, law applies to the FHA. In your husband's situation, the FHA could sue him for the $27,000 deficiency loss.

DEAR BOB: I have been reading your articles for years. Recently, I decided to follow your advice to drop the private mortgage insurance on my home loan. I phoned my lender, Norwest Mortgage. Within 10 days, Norwest sent me the requirements to cancel PMI. The requirements stated my house would have to appraise for at least $141,000 so my mortgage would be below the required 80 percent loan-to-value ratio.

I contacted a local appraiser who quoted me a $300 fee, which is about normal in my area. Fortunately, the appraised value of my home came back at $149,000, well above Norwest's requirement. About two weeks after Norwest received the appraisal, I received a PMI refund check for $406, and my monthly mortgage payments dropped by $54.

That $460 immediate return on my $300 "investment" for the appraisal, plus annual PMI savings of $648, was worth the effort. Many thanks for encouraging borrowers to cancel their PMI when possible. By the way, I'm going to pay $54 extra each month toward mortgage principal reduction.--James R.

DEAR JAMES: Thank you for sharing your PMI success story. Over the years, we've heard so many PMI horror stories about unreasonable lenders refusing to drop PMI after the loan balance drops to less than 80 percent of the home's value.

DEAR BOB: I plan to buy a new house for cash. I've heard that I don't need a title insurance policy because I am paying cash. Normally, in our area the builder pays for the title policy. He will credit the title policy cost to my purchase price (about 1 percent). What is the purpose of the title policy and do I need one when paying cash for a new house?

--Bill H.

DEAR BILL: Every real estate buyer needs an owner's title insurance policy. Not only does a title policy ensure that you are receiving marketable title, but it protects you against unexpected title loss risks such as forged signatures in the title chain; mechanic's liens, a major risk on a new house; judgment and income-tax liens against the seller; encroachments; undisclosed easement; and a zillion other title risks.

Don't try to save a few dollars. Every buyer should insist on obtaining an owner's title insurance policy to protect equity, especially when paying all cash and buying a brand-new house.

DEAR BOB: My husband and I are nearing retirement. We owe about $13,000 on our 8.5 percent interest rate mortgage, but our house needs about $10,000 of improvements. Should we refinance our first mortgage to pay for the improvements or just take out a home equity loan? Our goal is to have everything paid off by 2003.--Nancy P.

DEAR NANCY: There is no right or wrong answer to your question. If you refinance today, you'll pay about 8 percent interest on a new fixed-rate home loan. However, you may wish to refinance with a five-year adjustable-rate mortgage at about 6.5 percent interest. Since you plan to pay off your financing in four or five years, you'll need to make extra monthly payments to accomplish that goal. Frankly, I would lean toward taking a $23,000 five-year refinanced ARM to include both the $13,000 and the $10,000 for improvements.

However, a $10,000 home equity mortgage for improvements will be much easier to obtain. Most banks and other lenders will gladly make such a loan. However, the interest rate will probably be about 9 percent.

DEAR BOB: My husband and I moved out of a rental house in June 1998, but we're having a hard time finding the owner to get our security deposit refunded. Our rent was paid to a licensed professional property manager. However, five months after we moved out, this woman told us she cannot find the owner and that we must track him down ourselves to get our deposit back.

We tried suing her in small-claims court, but the judge agreed with her and said we had to find the owner ourselves. In court, she told the judge she had the owner's current address and would give us the information. But when we phoned her, she refused because she was angry at us for taking her to court.

I have tried tracking down the owner through the property tax and permit offices, only to find him listed with a rental mailbox. I did find an address in Southern California, but the letter came back "return to sender." He owes us $850, and I feel taken advantage of. What can I do?--Donna D.

DEAR DONNA: It is shameful how a few bad landlords give the entire residential rental industry a bad name. That small-claims court judge was wrong for ruling against you. Because the licensed professional property manager is the agent of her principal (the landlord), she is responsible for refunding your security deposit because she was responsible for managing the property.

Unfortunately, the small $850 amount isn't worth hiring an attorney for. Your most practical recourse now is to go after that property manager. Contact the state real estate commissioner and file a complaint against that licensed agent who collected your rent but now refuses to refund your security deposit. The clock is ticking. You shouldn't lose your $850 security deposit, but if you don't act quickly the statute of limitations may bar recovery. Don't give up.

DEAR BOB: My parents bought four lots in 1939 and built a small house. The lots were never recorded. Dad died in 1969, but the property taxes have been paid for 60 years. Mother is 90 years old. We would like to be able to sell these lots if she needs to go into a nursing home or dies.

We have been to several lawyers. One laughed. Another one said he would "do something," but he didn't. Now we have a lawyer who wants to contact all the descendants, which are many, of the original owners. He says it will cost $5,000 to $6,000. Isn't there a simpler way to clear up the title?--Charla N.

DEAR CHARLA: You are wise to clear up the title to those lots now. The obvious solution is a quiet-title lawsuit to prove your mother owns those lots. When you say "the lots were never recorded," I'm not sure if you mean the subdivision was never recorded or the conveyance to your parents was never recorded. Who has the deed? Perhaps the sale was a "contract for deed" or other type of sale in which the seller retained title until all or an agreed-upon number of payments were made.

The lawyer is correct that the known descendants of the original sellers must be notified of the quiet-title lawsuit. However, most courts do not require heroic efforts. It may be possible to serve them by publication of a notice in a local legal newspaper in the jurisdiction. Perhaps you need a second opinion from a real estate or title lawyer to determine the easiest way to clear up the title, which obviously belongs to your mother since there is no real conflict.

DEAR BOB: My mother died in April. In her will, she left a house and a lot in Georgia to my sister and me. Because we live out of state, we agreed to let a relative live in the house and be responsible for paying personal utilities. In preparation for when we want to sell, how do we obtain the market value on the date mother died? You recently said there can be an "alternative valuation date determined by the estate." What is that?--Robbie N.

DEAR ROBBIE: In some counties, the assessed property valuation is sufficiently accurate for determining date of death valuation. But in other areas, such as California where property is reassessed only when title is transferred, assessed values are usually out of step with market values. Check with the tax assessor in the county where your mother's property is located.

Sometimes, an estate executor or administrator elects an alternative valuation date for property valuation when the estate files its federal estate tax return. If your mother's estate used an alternative valuation date, you can use that value as your basis.

Remember your taxable profit, if any, is only the difference between the estate's stepped-up valuation for the house and the net or adjusted sales price you and your sister receive for the property. For further details, consult a tax adviser.

Readers with questions should write Robert J. Bruss at P.O. Box 280038, San Francisco, Calif. 94128.{copy} 1999, Tribune Media Services Inc.