Barbara's Blog - Property Surveys

If you are in the process of or planning on refinancing, you may face the question of whether or not you should get a property survey done.

The answer is yes and no. Yes, your lender will need a survey of the property , but if there haven’t been any changes to the property since the survey done when you bought the property, then you don’t necessarily need another done. Check with your lender to see if they will take the previous survey along with sworn affidavits that no changes or improvements were done to the property.

Survey Vs. Appraisal

It’s important to know the difference between a survey and an appraisal. An appraisal helps a lender determine the value of a house which will help determine if a mortgage on the house is a good investment for the bank. As stated in an earlier blog, the appraisal analyzes the condition of a house, the house’s structure as well comparable sales in the area.

A survey determines or confirms property lines. It also verifies whether or not there are any encroachments on the property line either by the owner or the neighbors.

Since the mid-1980s, surveys have become an important part of the mortgage process. Lenders insist on clear Lender’s title insurance that will cover the face value of a mortgage which they get through a title company. Title companies will not issue this insurance without a proper survey verifying property lines.

All buyers should have a property survey done, you’ll need to know where your property begins and ends, if there are out buildings on or within your property lines. A survey will also help if you plan on installing a fence, you do not want to get into property disputes with your neighbors because your fence is two or more inches on their property.

Here are some suggestions involving the survey process.

First, survey prices vary considerably. Some banks will suggest a surveyor to you, ask for an estimate. If it seems too high, ask your real estate agent or settlement attorney for a recommendation and arrange for your own survey - make sure a copy gets to your lender before the settlement. Please note that it has to be done by a qualified surveyor that is licensed in the state the property is located and the lender has to approve the surveyor before the survey is done.

Next, have your real estate agent talk to the seller agent who did their survey. You should ask the prior surveyor if the old survey can be updated and if so, you can save some money. Some of the more reputable surveyors are happy to get your business and will give you a break in the price. Check with your lender prior to updating an old survey, they may not accept updates.

A good place to look up property lines is your local land records office; they can help you with any boundary questions. Please note, these records cannot be a substitute for an office survey. The reason being, a type of survey title insurance companies require are called ‘house location” surveys and is said to not be an accurate survey.

If you want to get full title insurance coverage, you can get what is known as an American Land Title Association (ALTA) Survey. This survey is very detailed and comprehensive and will cost a great deal more than your average house location survey. You might get an ALTA Survey if you want to be absolutely sure of your property lines and of any encroachments. But again an ALTA Survey is not a necessity.

And finally, understand that most surveys do not include staking the corners of your property. It will cost an additional fee if you want the property staked off. If you do want stakes, you should make those arrangements when setting up the survey.

Go over the survey results with your settlement attorney prior to the actual settlement date. Make sure you get the answers to any questions that may arise from the survey such as fence encroachments, do you own the driveway or is it shared, who owns the trees on the property and any other property issues that may arise. It’s important to go through the survey and raise any issues prior to the settlement, because once the property is official yours, it will be too late.

It is definitely worth mentioning that is you are buying a condo, you do not have to get a location survey on the land or the specific location you are purchasing. A survey was already done on the land when the condo was being built.