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Always Obtain A Property Survey

Written by on Sunday, 31 October 2004 6:00 pm
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Question: At our settlement recently, the settlement attorney charged us $225 for a survey. When we questioned this charge, we were told it was a lender's requirement and we could do nothing about it. Just what is a survey?

Answer: I hope the lawyer at least gave you a copy of the survey and fully explained it to you.

It is important to distinguish between a survey and an appraisal -- both of which are generally charged to the buyer. An appraisal assists the mortgage lender in assessing the value of the house so as to determine whether a mortgage should be made and in what amount. Generally, the appraisal will analyze the condition of the house, its location, structural soundness and comparable sales in the area.

A survey, on the other hand, goes to the question of the marketability of the house. The surveyor determines whether the house is within the property borders, whether there are any encroachments on the property by neighbors and the extent to which any easements on the property may affect legal title.

Up until the mid 1980's, mortgage lenders did not require a survey. But this has changed. Title companies, when issuing a title insurance policy, will issue an exception to title unless a survey has been obtained. Since Lenders insist on obtaining a clear "lender's" title insurance policy covering the face value of the mortgage, it becomes necessary to obtain a survey to satisfy the lender's requirements.

My own belief is that everyone buying a house should obtain a survey whether or not the lender requires it. Even if you pay all cash for your new house, you should insist on obtaining a survey when you go to closing. It is a good idea to learn, for example, where your property lines are, and whether there are any building restrictions affecting your right to add a porch or a fence.

Here are some suggestions involving the survey process:

First, survey prices vary considerably. I've seen them as low as $150 and as high as $300, for the same single-family house. Ask your settlement attorney for an estimate. If it seems too high, arrange for your own survey and make sure a copy of the survey gets to your lender well in advance of settlement. It must be done by a qualified surveyor, licensed in the state where your property is located.

Next, ask your sellers who did their survey. Unfortunately, most lenders will not honor a survey if it is more than six months old. But inquire from the prior surveyor whether the old survey can be updated and whether this will save you some money. Some of the more reputable surveyors are happy to get your business and will give you a break in the price.

Additionally, if you are refinancing your existing home, most lenders and title insurance companies are willing to accept a survey affidavit instead of a new survey. You will have to sign an affidavit that no improvements have been made to the property since you originally purchased it. These affidavits are available at a minimum cost.

You should also go to the government surveyors in the land records office where your property is located. They are quite helpful and may be able to assist you with boundary questions, easement issues and such.

If you are buying a condominium unit, you will not have to obtain -- or pay for -- a separate survey of your unit. That survey has already been done as part of the plans which were recorded with the condominium documents.

It should be noted that the typical survey which most purchasers obtain when they go to closing is called a "house location" survey. Title insurance generally will exclude from coverage "encroachments, overlaps, boundary line disputes and any other matters which would be disclosed by an accurate survey and inspection of the premises."

The title insurance industry takes the position that a "house location" survey is not such an "accurate survey," and thus will reject many claims regarding boundary disputes.

To obtain full title insurance coverage, the purchaser should obtain what is known as an ALTA (American Land Title Association) Survey. This is a very detailed, comprehensive survey, which will cost considerably more than the house location survey.

To be absolutely sure of what property you are purchasing, you might want to consider obtaining this ALTA Survey. However, most residential purchasers would rather not spend that additional money, and will take a chance that the house location survey will adequately protect them.

Finally, keep in mind that most surveys will not include staking your property corners. If you want stakes posted, it will cost you additional dollars. You should make the necessary arrangements for stakes at the time you order the survey.

When you go to settlement, you should ask the settlement attorney to review the survey with you, and to discuss any potential issues which that survey may raise. Are the fences encroaching on your neighbor's property? Is the driveway owned by you -- or it is a shared driveway? Who owns any trees which are on the property? Once you purchase the property, it may be too late to raise any boundary-related issues.

And don't forget to get a copy of the survey from your closing attorney before you leave the settlement table.

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  About the author, Benny L. Kass

6 comments

  • Comment Link Adam Monday, 13 April 2015 10:17 am posted by Adam

    Many people want to make money at home and they want to find a work at home job to do it with. Ultimately what happens is they become frustrated as they search from website to website looking for the right job. This brings up the question, why are work at home jobs so hard to find? In this article we will take an honest look at this problem.

    1. First of all you should know that most of the opportunities to work at home are not actually paid jobs. This is true because most employers do not know you and have no control over the work environment when you do it from the comfort of your own home.

    If you realistically think about this, why would someone pay you an hourly rate when they do not know if you are really working or not? Therefore many of the opportunities to work at home are actually in the form of business opportunities where you work for yourself.

    2. There really are some companies looking for people to work from home. This phenomenon is known as telecommuting and does provide an opportunity for people with legitimate skills to get paid working from home.

    This benefits both the company and the worker because the business does not need to provide a space for you to work from, and as an employee you do not have to get up and drive to work every day.

    Many companies now will offer work at home jobs that include an hourly rate and benefits. These benefits can include paid vacation, retirement plan, and health insurance.

    One such website or you can visit is Tjobs.com. They match employers looking for workers with employees who are looking for opportunities to telecommute. This works out very well for people who have skills such as sales, customer service, website design, and other categories.

    3. Another thing I want to talk about is websites that present themselves as work at home jobs doing data entry, taking paid surveys, and typing at home. Generally these websites are trying to sell you information on how to get involved in this type of work.

    There are companies who will pay you for your opinion, or to do data entry and typing. The websites that are selling you the information deserve to be paid because they have taken the time to develop a list of companies for you to contact.

    In the future work at home jobs will become more readily available. Until that point you need to be conscious and only deal with reputable companies before spending any of your hard earned money.

    To learn more about the top paid survey sites please visit: http://getpaid-survey.com

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  • Comment Link Stephanie Rodgers Wednesday, 18 March 2015 9:36 am posted by Stephanie Rodgers

    My husband and I are currently looking at buying a home. I knew about the appraisal but I was unaware of land surveying and that it was a requirement by the title company before the house could be sold or purchased. Thank you for your post about what is involved in home location surveys and what you get in return for having one done. http://www.communitysciences.com/landsurveying.html

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  • Comment Link benny kass Thursday, 28 August 2014 8:08 am posted by benny kass

    thanks for the kind comments

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  • Comment Link full details Thursday, 28 August 2014 1:45 am posted by full details

    Normally I do not read article on blogs, but I wish to say that this write-up very compelled me to try and do it! Your writing style has been amazed me. Thanks, very great post.

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  • Comment Link Amanda Monday, 26 May 2014 1:27 pm posted by Amanda

    How can I get a survey for my home what is the process what number do I call? Where do I go ?

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  • Comment Link Bill Tuesday, 10 December 2013 7:30 pm posted by Bill

    Thank you for4 the helpful tips. We are buying a brand new house and we were wondering if we need a survey. Thank you for answering our question in your excellent article.

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