QDEAR BOB: My wife and I separated in April 2003, and she moved out and rented a house. We filed for divorce in May 2004 and the divorce will be final in January. We own a house together, but it is my principal residence where I live with one of our children. The house has appreciated in value at least $400,000 since we bought it. The divorce agreement says when the house is sold, within the next five years, the net sales proceeds will be divided equally. How far ahead can we sell the house and still both be entitled to claim that $250,000 tax exemption? -- Vic S.

ADEAR VIC: There is no time limit for the Internal Revenue Code 121 principal residence sale tax exemption in a divorce. Many divorce agreements specify the family home shall be sold when the youngest child becomes 18 or 21.

As long as the "in spouse" living in the home qualifies for the IRC 121 exemption (principal residence ownership and occupancy for at least two of the five years before sale) up to $250,000, your "out spouse" former wife not living in the home also qualifies. Consult a tax adviser for details.

DEAR BOB: I have been divorced for three years. As part of the settlement, my ex-wife received the house and was to refinance it under her name alone. She never did this, and the house and mortgage are still in both names. My ex-wife got into a dispute with the mortgage company. She hasn't made a payment since last October. I just learned of this default about a month ago. Because I have my own obligations, including child support, I cannot afford to bring this mortgage current or pay the monthly payment. How can I get out of this mess? My credit rating is destroyed. If she doesn't pay up, the house is scheduled for foreclosure. What can I do?

-- Calvin A.

DEAR CALVIN: Your divorce lawyer messed up. The agreement for your wife to refinance the mortgage in her name alone should have been implemented before the divorce was final. Unfortunately, there is no easy solution if you can't afford to save the house from foreclosure loss by paying the amount in default.

Not only has your ex-wife only ruined your credit, because your name is still on the mortgage, but she has also made it likely that you will lose your equity in the house. Perhaps your divorce lawyer can suggest a solution, but I don't see any easy answer. Perhaps other readers can learn from your mistake.

DEAR BOB: On both sides of our back yard our neighbor's trees overhang our property. Do we have any legal rights to trim these trees, which have become nuisances by dropping leaves and debris into our yard and pool? The neighbors refuse to take any action. When we phoned the city for help, we were told to "consult a local real estate lawyer." What can we do? -- Brady B.

DEAR BRADY: The general rule for trees growing on a neighbor's property is that an adjoining owner has the right to trim the tree back to the boundary line at the trimmer's expense. This same general rule applies to roots, but there's nothing you can do to force your neighbors to trim their trees or cut them down.

A "rule of reasonableness" applies to any trimming you do. That means you're liable if you trim the overhanging branches or cut the roots so severely the tree dies.

DEAR BOB: We are buying a 36-year-old home. It is listed by the real estate agent as having 2,600 square feet. He told us the asking price is based on the age of the home and its square footage. Our purchase offer was accepted by the seller and we are two weeks from closing. We now have discovered that the actual square footage is only 2,414, according to city tax records. We did a quick exterior measure of the home confirming about 2,400 square feet. While 186 missing square feet might seem minor, we feel cheated. Do we have any recourse? -- Jack K.

DEAR JACK: Listing information for homes usually contains a disclaimer such as, "Information deemed reliable, but not guaranteed." The city records might be wrong. Even experienced appraisers measuring the same house often come up with different square footage.

Unless you can prove you made your purchase offer based on the house's square footage, such as $100 per square foot, you're out of luck. If the square footage turned out to be 2,600 square feet, would you volunteer to pay the seller more money? I doubt it. It's not worth arguing about the missing 186 square feet unless you can prove a substantial intentional misrepresentation by the seller or agent.

DEAR BOB: Ours is a second marriage. My husband deeded his house to both of us as tenants in common. How will the house be divided with his son and my three children when one of us dies? -- Geraldine H.

DEAR GERALDINE: Because title to the house is now held as tenants in common, the terms of your wills control who receives title to each half after a spouse dies.

If your husband dies first, his half of the house passes according to the terms of his will, presumably to his son. Will you enjoy owning half of the house while your late husband's son owns the other half?

If you die first, your half of the house passes under the terms of your will, presumably to your three children. Will your widower husband enjoy owning his half of the house with them?

Worse, if either or both of you die without valid wills, the state law of intestate succession determines who owns the deceased spouse's half of the house.

Your situation is a classic example why, especially in second marriages, holding title as tenants in common is usually not wise.

To illustrate, did you know that a tenant in common can file a partition lawsuit to force the sale of the house? Some heirs might, after one spouse dies, force a sale of the house.

You and your husband should consult an estate planning lawyer. The best solution to your situation might be a joint living trust where you can specify what happens to the house title after one spouse dies. A major living trust advantage is probate court proceedings are avoided and property partition rules don't apply.

DEAR BOB: Several months ago, we submitted a full-price purchase offer for a home listed at $439,999 but we lost out because there was an offer higher than ours. The only contingency in our purchase offer was a professional inspection clause. However, recently the house sale closed to another buyer at the same price we offered. Since we now know the sales price, my buyer's agent thinks we were discrimination victims and says we should sue the listing agent.

Is there anything we can do to help us get that house, which we liked much? -- Raj V.

DEAR RAJ: If you have any specific evidence of illegal racial or religious discrimination, you might have a cause of action against the seller or listing realty agent. However, a home seller does not have any legal obligation to accept a purchase offer at the full asking price or even at the highest price offered.

Just like a newspaper advertisement, an asking price for a home is legally just an invitation to buy at the specified price. Of course, if merchants failed to sell at their advertised prices, they would quickly be out of business.

That's why, for example, some home sellers list their homes for sale at abnormally low asking prices without any intent to accept a full-price offer. Their desire is to create a "buyer frenzy" to create bid competition among buyers to sell the home for far above the asking price.

I think this is unethical, but it is legal. The sellers of the home you wanted to buy might have had other reasons for selling to the buyer who purchased their home. To illustrate, maybe their offer had no contingencies or contained a closing date that met the seller's schedule.

There's no way a court would "undo" a completed home sale to the legitimate bona fide buyer. However, you might have a cause of action against the seller or listing agent if you can prove damages. Consult a lawyer for details.

DEAR BOB: I am in the process of cleaning up my credit and I want to buy a condo in a specific complex, preferably with seller mortgage financing. I plan to send condo owners there solicitation letters in the hopes they will sell to me directly, thus saving the realty agent's sales commission. I have a 3 percent to 6 percent down payment. Do you think a seller will finance my condo purchase at 3 percent interest? That's about what they can earn at a bank. Will this work? -- Judith N.

DEAR JUDITH: You are out of touch by offering a condo seller only a 3 percent interest rate in a 6 percent mortgage market, especially considering your extremely low cash down payment.

Unless a condo owner in your "target complex" is highly motivated to sell when your letter arrives, you will probably get little or no response. However, if you offer a seller a 6 percent mortgage interest rate, that might get the attention of a condo owner who has been thinking about selling.

Out-of-town condo owners who are having trouble with their renters are usually responsive to unsolicited purchase offers such as yours. You might have to send several repeat letters to each condo owner, plus follow-up phone calls to get any response.

DEAR BOB: I just finished reading your report about senior citizen reverse mortgages. Can we get a reverse mortgage on our free-and-clear home for about 60 percent of its value and put that money in our credit union, which is paying 5 percent interest on 60-month certificates? Then we would draw out $1,000 per month. Yes or no? -- Mason C.

DEAR MASON: Presuming both spouses are 62 or older and your home's market value is sufficient, you can take your reverse mortgage entire lump sum entirely at one time. But your idea sounds rather foolish.

It doesn't sound smart to obtain a reverse mortgage, costing you at least 5 percent interest or more, and then put that money into an account earning 5 percent taxable income.

If you want monthly income, why not select the reverse mortgage lifetime income alternative? Or use the credit line choice. I see no advantage to your idea.

DEAR BOB: There is an unused alley adjoining my home and those of my neighbors. It used to be a service road. But it hasn't been used for many years. One owner has fenced part of the alley as his back yard. Another of my neighbors told me I can have the alley appended to my lot. Do I have any legal rights to claim this section of the unused alley? -- Sean D.

DEAR SEAN: You and your neighbors cannot claim title to the unused alley by adverse possession or prescriptive easement. The reason is that government agencies and public utilities are immune to these legal methods of obtaining property.

It would be best to have all the affected neighbors petition the city or county to abandon its alley and transfer title to the adjoining homeowners. The government agency will probably be glad to get rid of the potential liability for any accident on its alley.

Contact the appropriate local official to get the procedure started. A friend of mine did that a few years ago because his was the only house at the end of a city street. The city was glad to abandon the street, which led only to his house. Now he owns the entire street, which is only one block long. He even installed a fancy gate to keep out trespassers.

DEAR BOB: We had the final walk-through inspection on our home on Monday. The mortgage funding and closing were on Wednesday. The seller then had 72 hours to vacate. On Sunday when we moved in, we discovered damaged walls, toilets clogged, pipes leaking and the wood floors scratched.

What recourse do we have after all the funds were transferred to the home seller? -- Frank W.

DEAR FRANK: Home buyer walk-through inspections should be scheduled after the seller has moved out. But that advice is too late for your situation, which shows what can go wrong when the buyer's inspection occurs too early.

If your sales contract says the home is to be delivered in the same condition as when you inspected it, then the seller is liable for the cost of repairing any damage. Take photos of the damage. Save your repair bills. However, if you do the repairs yourself, don't expect reimbursement because the value of your labor is impossible to determine.

Presuming the total repair bills are not large, after making a written demand for reimbursement from the seller, suing the seller in local small claims court is your easiest remedy.

DEAR BOB: My wife and I, after having sold our previous home, bought a new Florida condo a few months ago. We paid more than $425,000 cash. Everything was new and we were thrilled, but then reality set in. We expected the builder to correct the defects listed on our punch list.

More than four months later, we're still waiting. We have received notice that our $230 monthly homeowners association assessment will be increasing to $470 on Sept. 1. Also, the common area improvements such as landscaping are minimal, nothing like what was promised or shown in the drawings. We are upset and wish we had never purchased.

With our $425,000 tied up, we have no exit. What can we do even though the developer still controls the homeowners association? -- Harold V.

DEAR HAROLD: Now you know why I always recommend home buyers make a modest down payment, up to 20 or 25 percent of the purchase price, and obtain a mortgage for the balance. If the home purchase turns out well, after a few years the mortgage can be paid off. But it sounds like your situation is bad. Presuming you have tried to reason with the developer, the next alternative is for you and your neighbors to hire a local lawyer who specializes in condominium law to protect your legal rights.

DEAR BOB: My wife and I are in our seventies and we hold title to our home in a living trust, as you often recommend.

But a friend, whose wife died a few months ago, told us how easy it was for him to clear their joint tenancy title without probate. He told us he just went to the county deed recorder's office, filed a certified copy of his wife's death certificate and filled out an affidavit of survivorship to clear the title to his house.

Do you think we should switch to joint tenancy with right of survivorship? -- Daniel W.

DEAR DANIEL: Your friend's situation had no complications. But suppose his wife suffered a stroke or contracted Alzheimer's disease and he had to sell their home to provide funds for her care? He wouldn't have been able to do so if she wasn't capable of signing the deed.

However, with a joint living trust, if one spouse becomes unable to manage their affairs, the other co-trustee can act, such as selling the home. Upon death, a living trust also avoids probate costs and delays. A living trust is much better than joint tenancy. If I were in your situation, I would do nothing.

DEAR BOB: Six months ago, I moved into a condo I bought. It was an apartment building conversion to condominiums. I discovered there is almost no soundproofing between my unit and my neighbors above. They keep different hours than I do. Their animals are up at all hours. I haven't slept a full night since moving in.

I've been back and forth with them, and the homeowners association, with no results. Is there a city ordinance that requires the noise between condo units to be below a certain level? Some nights it sounds like my upstairs neighbors are in my own room with me, especially when they drop things or make a racket. It has become unbearable. What can I do? -- Jennifer H.

DEAR JENNIFER: Most cities do not have any noise ordinances affecting condos. But I understand your problem extremely well because I had a similar problem with the first condo I owned. If it is any comfort, bad soundproofing is the number one complaint of most condo owners.

My upstairs neighbors had nightly loud arguments with their teenage son. Until then, I never heard parents and their teenager use such obscene language. I couldn't believe parents and their son talked to each other that way. It later grew intolerable, as has your situation. My neighbors ignored my polite requests to hold down their noise. The homeowners association was no help.

I hired a contractor to soundproof my condo ceilings. That helped, except when the loud arguments occurred in their kitchen, above mine, which couldn't be soundproofed because of the cabinets.

Eventually, I sold my condo at a huge profit after disclosing the problem to the buyer who didn't seem concerned.

Ironically, about two months later, the upstairs condo owners sold their condo due to a corporate job transfer.

You might want to retain a lawyer to bring a lawsuit against your upstairs neighbors to abate a private nuisance. Soundproofing your condo could be quite expensive and might not solve the problem.

DEAR BOB: About two years ago, we were desperate to sell our two-bedroom house. Most buyers wanted three or four bedrooms. Our real estate agent had our listing six months and was unable to sell it. After the listing expired, we ran a newspaper ad: "Take over payments. Open house Sunday." We were swamped by good prospective buyers. We sold to a young doctor and his wife. They paid us the cash down payment we needed and faithfully paid our mortgage on time every month.

Now the house has been sold again so our mortgage was paid off. Thank you for telling us about selling "subject to" the existing mortgage otherwise we would still own that house -- Harvey T.

DEAR HARVEY: I'm glad your "subject to" mortgage sale worked out well.

For readers not familiar with a "subject to" sale, that means the home buyer does not formally assume the existing mortgage obligation. Of course, the buyer must make the monthly payments or lose the house by foreclosure.

A "subject to" home sale technically violates the mortgage-due-on-sale clause. However, mortgage lenders rarely enforce such clauses unless the payments are not being made on time.

Your big risk, as a seller, was that the doctor and his wife would default on the mortgage payments. Since they had not assumed the mortgage obligation, such a default wouldn't hurt them except for losing the house by foreclosure).

But their default would harm your credit rating because you were still obligated for those mortgage payments. You made a wise decision to sell to people who took their financial obligations seriously.

Readers with questions should write Robert J. Bruss at 251 Park Road, Burlingame, Calif. 94010, or contact him via his Web page, www.bobbruss.com.

{copy} 2004, Inman News Service