You've probably heard of squatter's rights. But ever wonder if they could get you a free house? I'm Claes Bell with the Bankrate.com Personal Finance Minute.
Adverse possession, commonly called squatter's rights, is a legal tool used to settle disputes over property lines. For instance, say a new neighbor moves in next door and discovers your fence is actually a foot over the official property line. Depending on how long the fence has been there, a judge might grant you the right to the property under adverse possession.
But some squatters are now attempting to use adverse possession to occupy empty homes. One Dallas-area man paid $16 to file a claim on a $300,000 house, promising to pay property taxes and maintain the property. He was eventually evicted, but got to stay rent-free, for 8 months.
Legal scholars, though, question whether such a legal gambit could work in the long term. Adverse possession requires a number of conditions to win out, including living openly in the house for 7 to 20 years, depending on the state. While many banks do have a big backlog of foreclosures, it's unlikely it would take them that long to notice you're living there and kick you out.
For more on this and other personal finance topics, visit Bankrate.com. I'm Claes Bell.