You’ve seen the stories in the newspaper about the excavator who created a geyser when he hit a buried water line, or the contractor whose errant backhoe cut off phone service to half the town. But it’s not only the heavy equipment that’s a risk of cutting into underground utilities – every time you pick up a shovel, you could be at risk as well.

It’s important to remember that right below your feet there is a network of everything from water lines to TV cables, and some of it may not be as deeply buried or as well protected as you might think. For that reason, most states and local jurisdictions have fairly strict laws making it your responsibility to know what’s under there before you dig, whether you’re a contractor with a backhoe or a homeowner with a shovel. Those same laws can make it your financial responsibility as well should an underground utility be damaged.

Fortunately, most states also offer locating services that will mark out utilities for you. One call is usually all it takes, and the marking is typically done within two business days. As long as the markings are in a public right of way or within a utility easement on private property, there is also typically no charge for this service.

COLORS MARK THE WAY

Prior to starting excavation, the usual process is to mark out the proposed areas of digging using white paint. White is the standard color for temporary survey markings, and is used so as not to conflict with the colors used by the utility marking crews.

Once the proposed excavation is marked, the utility locating service will mark out any utilities in the immediate area, using temporary color-coded marking paint sprayed directly on the ground. The standard color-coding system used by most utilities is:

Red: Electric power lines, cables or conduit; lighting cables.

Yellow: Gas, oil, steam, petroleum or other hazardous liquids or gases.

Orange: Communication, cable TV, alarms or other types of signal lines, cables or conduits.

Blue: Water and irrigation lines.

Green: Sewer lines, storm sewer facilities or other drain lines.

Before beginning any excavation, even something as simple as installing a fence or a sprinkler system, be sure and contact your local utility company or building department. They can provide you with the phone number of the local utility locating company, as well as complete information on color coding and locating procedures.

KEEP YOUR OWN “LOCATES” LOG

Remember that the utility locating companies will locate and mark only primary public utilities, so it’s up to you to keep track of what else is on your own property. And while the state is not going to come after you for putting your post-hole digger through a sprinkler line, it’s far better to know that sprinkler is under there before you have to go through the hassle of fixing it after you cut it!

The easiest thing to do is to simply keep a log of whatever you bury on your property, from electrical wires and low-voltage lighting cables to water lines and sprinklers. If you do have a septic system, be sure and keep track of exactly where that is as well.

As you excavate, simply take a moment to measure where things are going, as well as anything you unearth as you go. Measure the distance to the excavated area from at least two points on your property, such as from a corner of the house, a street light, the sidewalk or driveway, or other fixed points. Draw a simple map, note the measurements, and also make careful note of exactly what you buried and how deep it is. A photo or two is also a great idea. Write down the date and place all the information in your “locates” file for easy reference in the future.

Utility companies typically do not mark private septic lines and drain fields, so if your home is served by a septic system, be sure to contact your local building department for help with septic locations.

Are you a real estate agent looking for listings with little or no competition? Are you a home buyer searching for a below-market-price residence few other buyers know about? Can you keep a secret?

If you answered “yes” to two out of those three key questions, keep reading.

I’m referring to the little-known “underground” real estate market of probate properties. Probate is the name given to the court procedure to distribute assets of a deceased person, whether that individual died with or without a written will.

Although there are several key methods to avoid probate costs and delays, such as use of a revocable living trust or holding title as joint tenants with right of survivorship, each year approximately six million new U.S. probate cases are filed. Not all these estates involve real estate, but several million do.

WHY CONSIDER PROBATE PROPERTIES? The obvious major reason is to acquire a property at a bargain below-market purchase price with little or no competition. If you are a licensed realty agent, and if you understand the local probate property procedures, you can obtain the listing from the estate executor or administrator with virtually no competition.

Unless there are probate problems, such as a will contest or unpaid creditor problems, most real estate left by a deceased owner can be sold by the estate representative without legal complications.

“Exposure to the real estate marketplace” is the enemy. That is the key message of the great book “Creating Wealth Through Probate” by James G. Banks (Dearborn-Kaplan Publishing Co., Chicago, 2005, $18.95, available in stock or by special order at local bookstores, public libraries and www.Amazon.com). Banks explains probate property secrecy usually results in a bargain sales price because there is little or no wide exposure for probate properties to the local real estate market.

FINDING PROBATE PROPERTIES ISN’T EASY. There are many reasons why properties owned by the estate of a deceased owner are sold. Reasons include the creditors must be paid, the heirs don’t want the real estate they inherited, and estate taxes must be paid from the estate assets.

For example, several years ago my good friend David was named executor in the will of a deceased homeowner who left his house to relatives living in a distant city. The house of the deceased was in bad condition. David hired a local real estate broker, Mark, to market the house for sale to produce cash for the heirs. The broker arranged painting and cleaning the house at a cost of several thousand dollars. After the house was in marketable condition, Mark listed it for sale. It quickly sold at a slightly below-market price, which satisfied the heirs.

The result was the estate got rid of a less-than-perfect house, the heirs got cash from the sale of a house they didn’t want, and the real estate agent earned a full sales commission.

To find potential probate property listings, real estate agents and investors need to be diligent. Sharp agents and investors clip the daily newspaper obituary notices, look for published legal notices to creditors and notices of petition to administer estates, check probate court public files to determine if the deceased left real estate to be probated, and check with estate executors and administrators to learn if real estate will be sold.

FOUR KEY PROBATE PROFIT OPPORTUNITIES. Whether you are a real estate agent looking for probate listings, an investor searching for a probate profit property, or a home buyer hoping for a bargain-price residence, there are four key profit opportunities:

1. BUY FROM THE ESTATE EXECUTOR AT A BIG DISCOUNT. Depending on the estate circumstances, such as whether the deceased left big debts to be paid from the sale of real estate, it may be necessary for the estate executor or administrator to sell the deceased’s property. Most executors and administrators are “amateurs” so they usually want a quick, easy sale and are not motivated to get top dollar.

2. BUY FROM THE HEIRS AFTER THEY RECVEIVE PROPERTY TITLE. Another probate buying opportunity occurs after the title to the probate property is distributed to the heirs who often don’t want to keep it.

For example, years ago I bought a house where the elderly owner died of natural causes. Many people don’t want to buy such a property. But that didn’t bother me. The house had been listed for sale many months with an excellent agent. Then I made my purchase offer of 10 percent cash down payment with a 90 percent mortgage to be carried back by the three heirs. Father Ward, priest at the local Catholic church and one of the heirs, liked my offer. He recommended his siblings accept it, which they did. The result was a satisfactory sale for all.

3. BUY AT A PUBLIC SALE OF THE PROBATE PROPERTY. If the deceased property owner left no will so a private real estate is usually not possible, the local Probate Court might order a public sale of the property. That often means the estate administrator will list the property for sale with a real estate agent, subject to confirmation by the Probate Court. Local procedures vary.

4. PUBLIC AUCTIONS BENEFIT SELLERS, NOT BUYERS. Farms and difficult-to-sell probate properties are frequently offered for sale at public auctions. Heavy bidding frequently results in sales prices at or above fair market value. If you want to purchase a bargain-price property, buying at an auction is usually not wise unless there are few other qualified bidders.

PROBATE PROPERTY PURCHASE PITFALLS. If you are interested in acquiring a probate property bargain, you need to know of several purchase pitfalls:

1. PROBATE SALES ARE “AS IS.” Most probate property sales are “as is.” That means the seller does not make any warranties or representations. The result is the seller has no duty to pay for any repairs due to defects. Because the estate seller usually is not familiar with the pros and cons of the property, the estate is in no position to disclose defects.

In other words, the probate property purchase rule is “caveat emptor” (let the buyer beware).

If the buyer wants to make the purchase offer conditional on a professional property inspection, a termite (pest control) report, or mortgage insurance contingency, such clauses must be specified in the purchase offer. Otherwise, the buyer has no recourse for undisclosed defects.

2. WORK WITH THE ESTATE EXECUTOR OR ADMINISTRATOR. These individuals usually want to get the estate closed as quickly as possible. If you express an interest in a specific property owned by the estate, chances are you can negotiate acquisition of the property if you adopt a cooperative and flexible attitude.

3. ASK IF THE ESTATE WILL FINANCE THE SALE. “It doesn’t hurt to ask” is the rule if you want to buy a home or other probate property but financing is a bit difficult. In such a situation, don’t hesitate to ask. Better yet, make your purchase offer with a clause providing the estate heirs shall carry back financing on the terms specified in terms you offer.

4. HAVE A PLAN FOR THE PROPERTY. To be a successful probate property purchaser, you need a plan. Maybe it is to live in the residence. Perhaps it is to fix it up and earn a huge resale profit for “flipping.” Or perhaps you have grand ideas to develop the property for bigger and better uses.

SUMMARY: Most probate properties owned by a deceased property owner offer huge potential profit opportunities, whether you want to acquire that property for personal use or as a “quick flip” profitable property sale.

During the peak home sales season, when thousands of houses and condominiums will be sold, buyers and sellers need to be aware of what is legally included and excluded from their sale.

Most experienced real estate agents have horror stories about “fixtures,” which the seller removed but the buyer thought were included in the sale.

To illustrate, my mother was a mild-mannered woman. Only once did I ever hear her raise her voice. I was helping mom and dad move into their condominium. As I walked down the hallway to the condo carrying some boxes, I heard her scream as she entered the condo, “Where is the chandelier?”

The seller had removed the dining room chandelier. Even my dad was surprised.

Fortunately, a phone call to the real estate agent resolved the problem, the seller sheepishly restored the chandelier, and everyone lived happily ever after.

That typical example shows how important fixtures can be in a home sale.

THE SIMPLE REAL ESTATE LAW OF FIXTURES. Most home buyers and sellers, and even their real estate agents, often do not understand the simple law of fixtures.

A “fixture” is moveable personal property, which, by means of bolts, nails, screws, cement, glue, or other attachment method, has been converted to real property. Clearly, that dining room chandelier had been converted from personal property to real property because of its permanent attachment to the structure. Nothing was said in the sales contract about its exclusion from the condo sale.

A more troublesome example can be window coverings. Suppose a house or condo has beautiful draperies and attached wood window blinds. Those draperies hang by hooks from a drapery rod that is screwed into the wall.

The law of fixtures says the draperies are personal property because they can be easily removed without damage, but the drapery rods are fixtures included in the home sale. The wood window blinds, if permanently attached to the structure, are considered fixtures, which are included in the home sale.

But the printed sales contract can change the result. Most well-written home sales contract forms specify “window coverings” are included in the sales price (unless otherwise excluded).

REMOVE IT IF YOU DON’T WANT IT INCLUDED IN THE SALE. As longtime real estate agents know, the worst thing a home seller can do is hang a sign on a fixture stating the seller wants to exclude it from the sale.

Having bought many rental houses, I recall seeing little signs hanging from the dining room chandelier, or pasted on the front of the dishwasher, saying, “This item not included.”

That is like waving a red flag in front of a bull. Unless the item is junk, the buyer will then insist on receiving that fixture as part of the home-purchase price.

A better approach for home sellers is to remove the item before exposing the house or condo to prospective buyers. Removing the dining room chandelier and installing a tasteful replacement is far better.

For example, last year I recall inspecting an $18 million estate where the seller had removed the built-in kitchen appliances. Frankly, I thought that was “tacky.” But I was not a serious buyer so I didn’t bring up the issue with the listing agent.

MY FAVORITE FIXTURE STORY. Years ago, in the small town where I live, a large house was listed for sale. One of its primary features was the beautiful rose garden.

After the house sale closed and the buyer obtained title, image the buyer’s shock to discover the seller had removed all the beautiful rose plants. That seller obviously understood the law of fixtures.

Plants and trees growing in the ground are considered to be fixtures because they are permanently attached to the land by roots. However, because the rose plants were in large pots, the seller was legally entitled to remove them since they were not permanently attached to the real property.

AVOID FIXTURE TROUBLE WITH A WELL-WRITTEN SALES CONTRACT. When a home buyer spots non-fixture items, such as patio furniture, which the buyer wants included in the home sales price, the buyer must itemize that personal property in the sales contract to have it included in the sales price.

Similarly, if the seller wants to exclude any fixtures that are attached to the structure, those items must be itemized in the written contract otherwise they are automatically included in the sale.

Troublesome items to consider include: track lighting, fireplace inserts and equipment, solar systems, built-in appliances, screens, awnings, shutters, window coverings, attached floor coverings, TV antennas, satellite dishes and related equipment, telephone and Internet wiring, window air conditioners, pool-spa equipment, water softeners, security systems, keys to all locks, garage door openers and remote controls, mailbox, and landscaping equipment.

FIVE LEGAL RULES IF A FIXTURE DISPUTE GOES TO COURT. If a lawsuit develops over an item that the buyer thought was an included fixture, but the seller removed, five basic legal rules generally apply:

1. METHOD OF ATTACHMENT. The most important fixture rule is the method of attachment. If the item is permanently attached to the structure, it is legally considered to be a fixture, which is included in the home’s sales price.

However, if an item can be removed without damage to the structure, such as draperies, it is not a fixture. Examples include unscrewing light bulbs and unplugging a refrigerator because both are personal property not permanently attached to the building.

The item’s weight is immaterial. To illustrate, an aboveground swimming pool is removable personal property unless it is surrounded by a permanent structure, thus making it a real property fixture.

2. INTENT OF THE BUYER AND SELLER. If the written sales contract is indefinite, in a court trial the intent of the buyer and seller become pivotal.

For example, when the multiple listing service (MLS) listing specifies a “beautiful kitchen with the latest appliances,” that implies the seller intends to include those appliances and the buyer can rely on that statement. Or a description of the beautiful swimming pool can be interpreted to mean the seller plans to include the pool cover and equipment.

3. ADAPTABILITY TO PROPERTY USE. When personal property is built into a home, it indicates it has become a fixture, which is included in the sales price.

To illustrate, when I bought my home there were built-in stereo speakers on each side of the den fireplace. Although nothing was said in the sales contract, I would have been very upset if the sellers removed those speakers. However, they did unplug their stereo equipment and I had to buy new stereo components.

4. AGREEMENT OF THE PARTIES. A written contract that lists a specific item, whether it is a fixture or personal property, usually prevails to make it included in the sales price. If in doubt, buyers should list any questionable items.

5. RELATIONSHIP OF THE PARTIES. As a general rule, if a lawsuit develops, courts tend to favor a) buyer over seller, b) tenant over landlord, and c) lender over borrower.

TRADE FIXTURES ARE AN EXCEPTION. The fixture rules explained above apply to residential sales. However, when a commercial business property is sold, the business tenant is entitled to remove business trade fixtures.

Examples include restaurant equipment, outdoor business signs, display cabinets, a bank vault, and a tavern bar. However, the business seller or tenant must restore the premises to its pre-lease or pre-sale condition.

SUMMARY: A well-written sales contract can prevent fixture problems by clarifying what is included or excluded from a real estate sale. For more details, please consult a local real estate attorney.