Buying a property can be an expensive process. Among the many costs that a buyer faces, such as the cost of inspections, transfer taxes, and financing costs, you may be wondering whether you really even need a survey.
The answer is almost always YES. A good survey can reveal hidden problems with the property and save you thousands of dollars in unanticipated costs, or even from making a bad investment.
In some circumstances, you may be required to get a survey of the property. Most mortgage lenders require a recent survey to make sure that there aren’t problems with the property that would compromise its value as security for the loan. Title companies may also require a survey to insure against certain types of risk. But even if your lender or title company does not require one, it is almost always in your best interest to have the property surveyed anyway. As tempting as it may be to forego a survey and potentially save thousands of dollars in the process, you do so at your own risk.
Surveys are an important part of the research that every buyer should do before committing to the purchase of a piece of property. A good survey can tell you at a glance whether the property has access to a public road, whether any of the improvements on the property encroach onto neighboring land, and whether there are setbacks and easements that might restrict the way the property can be used. It can reveal problems with the legal description of the property, or whether or not the property lines are located where you think they are. Having a survey can also give you notice about things that might lead to future disputes – such as discovering that a neighbor’s driveway or parking lot encroaches onto the property.
A survey is important even if you are buying a vacant piece of land. For example, a survey might reveal that an easement runs right through the middle of the property, restricting the ability to construct improvements on the property. Even if you already have a written copy of the easement, without a survey you might not be able to tell whether the location of the easement could create a problem. A good surveyor can also note a property condition that might indicate the existence of an easement even where there isn’t any written easement agreement, such as evidence of a public path crossing the property.
Types of Surveys
Once you’ve decided that you need a survey, the next question is what type of survey you need. The answer will depend on what you are using it for. The most comprehensive type of survey is an ALTA/ACSM (American Land Title Association/American Congress on Surveying and Mapping) survey, commonly referred to as an ALTA survey. Commercial buyers, lenders, and title companies typically require an ALTA survey. At a minimum, an ALTA survey will show the legal boundaries of the property, any improvements on the property, and the location of any easements, rights-of-way, and encroachments. There are also a number of optional items that can be shown on the survey, such as whether the property is in a flood zone, the location of any wetlands, the height of any buildings, the number of parking spaces, the location of utilities, and more. Because ALTA surveys are prepared according to nationally published standards, they are the “gold standard” for surveys in the United States.
While an ALTA survey reveals a wealth of information about the property, they are also generally the most expensive and the most time-consuming type of survey to prepare. In some circumstances, a different type of survey may make more sense. Boundary surveys are typically a less expensive option which may be a better alternative for residential transactions or for low-risk activities such as installing a fence. A boundary survey will locate the property lines, set the property corners, and determine the area of the property. It may also show physical features such as buildings and fences in relation to the property boundaries.
A location drawing may look like a boundary survey, but it is not actually a survey at all. A location drawing may be prepared by a surveyor or an engineer, and is used to show the relationship of improvements in relation to the property’s boundary lines. Since only a minimal amount of evidence is used to locate the property’s boundaries, there is a much larger margin of error and it will not provide much information about potential risks associated with the property. Although a location drawing is the least expensive option by far, you should not rely on one in place of a survey when purchasing property.
Subdivision plats are surveys that are recorded in the land records of the county where the property is located as part of the process of subdividing land. A plat will show the boundaries of the property and may include certain information about the property such as setbacks and some easements. However, a plat will not show any property conditions that have been created since the property was subdivided, and may not depict every easement and right-of-way that affects the property. While a plat is useful information, it is not a substitute for a survey.
If you are buying property and aren’t sure whether you need a survey or what type to get, or if you need help with interpreting your survey to determine whether there are any conditions on the property that you should be concerned about, an experienced real estate attorney can help. Taking the time to properly research the property and spending a little extra money on a survey before closing can save a world of regrets later on.
For more information, contact the Davis, Agnor, Rapaport & Skalny attorney with whom you typically work, or one in our Real Estate Practice Group.
