What is a Lot Line Adjustment Agreement?
Lot Line Adjustment Agreements are prepared for the purpose of realigning and/or relocating the boundaries between two or more parcels of real property commonly held by the same persons, said adjustments being interdependently performed as to all affected lots and limiting the aggregate increase and decrease of land being transferred as between the parties hereto. Also, a Lot Line Adjustment Agreement will be prepared for parties that own adjoining parcels and wish to exchange property in a mutually beneficial manner for the purpose of creating a more useful lot configuration for the benefit of all parties involved. A lot line adjustment is also used whenever two neighboring lots are to be recombined into one new parcel. The benefit to such recombination is that private restrictions on the subdivided lot will be lifted and the set-back requirements on the recombined lot will be from the original property boundaries .
A Lot Line Adjustment Agreement is often prepared when the parties desire the ability to convey or mortgage the adjusted or new parcels without obtaining the approval of any governing authority. If the property to be conveyed pursuant to the lot line adjustment is contiguous to another parcel or lot owned by the seller, the change will not result in the violation of any zoning ordinance provisions. Likewise, a lot line adjustment cannot effectuate a transfer where the change will have the effect of creating an additional lot.
Lot line adjustments are sometimes authorized by special exception and involve the appropriate municipal authority as part of the development review process, however, these applications are filed for the entire tract sought to be subdivided and notice will be given to the owners of all lots adjacent to the entire property or tract sought to be subdivided. On the other hand, an application for a lot line adjustment is filed for the specific lots involved in the adjustment and without a submission of a site plan.
Advantages of Lot Line Adjustment
The primary advantage of a lot line adjustment is that such an agreement can resolve property boundary issues without the time, expense, and uncertain outcome associated with a court proceeding to quiet title, refile a deed or seek a nonconforming use permit. It can also provide stability when there is common ownership of adjoining properties. There are two fundamental circumstances where a lot line adjustment is useful.
First, where adjoining owners seek to adjust the lot lines to better reflect the respective actual uses of their properties. The situation may arise where: A lot line adjustment will permit each owner to use their property to a greater extent and eliminate any risk of a future dispute over the property line.
Second, where one person holds title to a parcel but the title documents do not reflect the actual dimensions of the legal lot based on the local ordinances. This can occur where the description is based on a survey that has since become obsolete, due to the re-measurement of the boundaries, or mapping mistakes or scrivener’s errors in the original deed. It may also be the result of a purported conveyance that lacked the correct degree of specificity or that violated a subdivision or zoning ordinance. The problem arising from this situation is that to obtain a building or grading permit under the local building code, the applicant will need to demonstrate that the parcel is a legal lot. In order to do so, the applicant must either provide sufficient proof of the required lot dimensions through a judicial or administrative process or revise the recorded description to meet the required dimensions through a lot line adjustment agreement.
How to Implement a Lot Line Adjustment
A lot line adjustment may seem like a simple undertaking because at the end of the process you will possess title to the land that was previously conveyed by warranty deed between the adjacent parcels. However, in most cases, there will be steps that require the expertise of professionals in the field of surveying, application of the state and local subdivision law in the jurisdiction where the adjustment is to take place and the approval of the board that governs the permitting of subdivisions and land development. In most jurisdictions, the first step in effecting the adjustment is engaging a surveyor to examine your property and the property of the adjacent owner to determine whether the adjustment is feasible. If the adjustment creates parcels that are not the subject matter of a recorded plat of the property, the surveyor should prepare proposed plurals of the adjustment. Typically, the owner of each parcel involved in the adjustment needs to review and sign the proposed plats before the plat is finalized. After the lots have been adjusted on the survey, the owner needs to provide copies of the signed proposed plats to the boundary owner and attorney so that those documents can be recorded. The document will need the original signature of the owners, a certification by the surveyor,, a copy of the deed of the property to be exchanged and, in some cases, a cover letter from the surveyor and an affidavit after the property has been exchanged. The documents are then submitted with the proper form to the land records office in the county where the parcels are located for indexing and recording. In some circumstances, the adjustment may be subject to approval by the land use control board in your jurisdiction. Many times, the approval is required in order to combine parcels that are part of a recorded plat with parcels that are not part of the plat. There are also instances where the platting requirements are not satisfied upon the adjustment and the approval is sought to permit the adjustment to occur. Due to the local land use control ordinances in some areas, there is a possibility that the lot line adjustment may not be permitted if the result of the adjustment does not comply with the local regulations.
Legal Guidelines & Restrictions
An adjustment of the lot lines between two properties can be as straightforward as it seems. However, that description belies the many legal requirements and restrictions that often govern such transactions, resulting in a serious potential for unintended consequences. In New Jersey, as an example, municipalities establish requirements for subdivision approval, including the ability to create lots of reduced size or frontage, and other conditions. In some towns, a land use board must approve even a simple lot line adjustment if the adjustment results in a situation that would no longer meet a variance requirement. For example, a lot of 50 feet by 100 feet that is adjusted to 40 feet by 110 feet may now have less than the required 50 feet of frontage. In that event, even a minor lot line adjustment may require formal action by a municipal land use board. Governmental actions also may have an impact on the type of lot line adjustment affected. In one case, the adjacent property would have qualified for a right-of-way only, but because of a change in zoning, approval of a lot line adjustment would then be required pursuant to the municipal land use laws (in New Jersey) rather than pursuant to the Municipal Land Use Law. That would mean that the transfer of an individual residential lot to another residential lot would have to be supported by a use variance, rather than by a simple subdivision approval. Obviously, when dealing with a small parcel in a buildable area, this may not be an issue. It is, however, a significant consideration for re-development of larger parcels, particularly in urban areas. In addition to zoning considerations, a property’s location may subject it to other controls on business activity or development. For example, projects in wetlands areas often require permits from the state Department of Environmental Protection, and property subject to a Green Acres restriction must be addressed by the Green Acres program. These considerations may impact the viability of the lot line adjustment. Approval of a lot line adjustment can be a fairly simple process. Usually, a survey must be prepared to show the affected lots with the new lot line as it will exist after approval of the lot line adjustment. At least one "permanent monument" must be established to mark the new property line , and the old property line must be shown on the survey. In some municipalities this will be sufficient to record the new lot line in the public records, although some municipalities require more or less information on the survey or the placement of monumentation. Additionally, some counties require that permanent monuments be placed along the new lot line, while others do not. A subdivision deed must be drafted and used to transfer the property from one owner to the other, and this deed must be recorded in the county public records. A lot line adjustment will not always trigger a need for certain regulatory approvals, such as approvals under the Flood Hazard Area Control Act (N.J.S.A. 58:16A-50, et seq.) or the Stormwater Management Act (N.J.S.A. 58:4B-1, et seq.). Absent a change in grade, grading permit and stormwater management regulations often will not apply, and issues in the flood hazard areas frequently will not apply because the disturbed areas in those zones are by nature small in scope, meaning that the overall project is small in scope. That notwithstanding, each project must be assessed on its own merits and the impossibility of a general rule will undoubtedly create exceptions in appropriate circumstances. There are myriad other statutes, regulations, ordinances and administrative orders that can apply, depending on the land use at issue, including rules governing soil erosion and sediment control (See N.J.A.C. 7:13-9, et seq.), agricultural use (See N.J.S.A. 4:1C-1, et seq. and N.J.S.A. 58:16A-50, et seq.), protection of historic sites (See NJSA 13:1B-15.152), forest resource management (See N.J.S.A. 13:1L-1, et seq., and N.J.A.C. 7:3, et seq.), and sand dune and shore protection (See N.J.S.A. 13:9-40 to 13:9-44), to name a few. Each of these can create special considerations in the context of a lot line adjustment. It is essential to identify the applicable requirements for any lot line adjustment before entering into a restriction or undertaking a transfer of title even if the transaction appears to directly involve only the adjacent property owners. The party seeking to alter existing property lines should seek the advice of counsel at the earliest stages of the project to avert the risk of wasteful and costly litigation, and to avoid the potential of disturbing otherwise solid title to property.
Pricing Lot Line Adjustment
Executing a lot line adjustment will likely incur some costs no matter how simple the circumstances. Among these costs are applicable permitting and application fees charged by the County or Town, an updated survey, possibly a new drawing of the subdivision plat showing the new lot configuration, engineering expenses (if it is a subdivision), and costs for recording the subdivision and deed with the Clerk’s office and after-the-fact County Clerk filings. If a site plan is required for a subdivision, there will be costs related to preparing the plan, surveying, and any engineering work that must be performed. You may also incur legal fees if a subdivision plat and/or easements have to be prepared or if the surveyor has to create the drawings for the subdivision.
Lot line adjustments can be a relatively simple and cost-effective method for keeping land with your property or moving it to an adjacent property. However, in some cases States, Counties or Towns may require lot line adjustment applications to be reviewed by a governing body, which would make the process more formal and expensive.
Mistakes to Avoid
A common mistake made is when an owner obtains the approval for the lot line adjustments and then thinks that the process is over and the new deeds can just be filed with the tax assessor or clerk or with the lender. Another common mistake is incorrectly drafting the lot line adjustment deeds. Most of the time, a deed must be recorded at the office of the County Clerk and the tax assessor (where applicable in your county) if you are dealing with real property (property with improvements and occupying land).
New deeds affected properties must be filed with the County Clerk and the tax assessor and filed with the lender’s where your mortgages are affected. If there is no such deed , then the new lots will remain as one property. This means that none of the conveyances will be effective upon recording. For example, if you own two lots, one with a house and one vacant, and you do a lot line adjustment, the following can happen: If you do not file the new deed where the house was, it will remain as part of the lot with the house. The vacant lot can remain vacant while the lot with the house will remain your property until you file the new deed.