Land Title Surveys

4 Replies

I have just returned to the No. Va. from S.W. Fla.and I’m puzzled about what is happening at the settlement table here.Now as a Realtor I am well aware that the settlement agent conducting the closing will tell anyone that they do not represent anyone present at the settlement.And of course I am also aware that almost no one ever asked the question.“Let the buyer and in this case the seller beware”

That said , as a professional in this industry, I truly believe that I am a financial advisor for my clients, not just someone who has a key that will unlock the door to the home they want to see.Moreover as a Professional Realtor I recognize that at settlement I must have my client’s financial interest, in the biggest investment they are likely to ever make in their lives, as my primary goal and not just there to see when I can pick up my commission check.

If this is in fact the primary goal for all Realtors why has it become the custom for so many transactions here for the Realtor to, in effect, ask the clients to buy “A PIG IN A POLK”?I’ll explain but first let me ask a few questions to put the “PIG” question in context.

  1. What is by far the most valuable part of a transaction that involves residential real property?
  2. Is it the new hardwood floors, the cedar shake roof, how about how real marble counter tops, or the pool and gazebo?

Of course not, these things are at best the doodads that make a home more saleable in some markets.No, I hope you would agree that, the most valuable portion of any residential real estate transaction, that involves the transfer of real property, is clearly the land that the improvements sit on.If this is true than why are so many homebuyers in this market being allowed to purchase real property without seeing the legally transferred portion of what they are about to take title to?My question is related to the relatively new custom in this area to have the home purchaser acquire real property without the benefit of ever seeing the land as it will be legally transferred to them.If this is true then aren’t they, in effect, being asked by the “professionals” in this market to buy “A PIG IN A POLK”.

This question comes down to 2 parts.

  1. Is what I have described actually the dynamic of this market?
  2. Is there a legitimate reason for any professional in this market allowinga client, unless they specify in writing otherwise, to purchase real property without the benefit of having a legally binding “land title survey” as part of the transaction?

With thanks in advance for your help, I remain;

Yours truly,

John W. Veatch

I understand and agree with your approach ensuring the best for your client, you also need to recognize the nature and scope of the transaction, the buyer's knowledge and expertise and their intentions. I can buy a property sight unseen and I may not be interested in what the agent has to say about the settlement transaction, but I understand there are different buyers.

And speaking of a "Land Title Survey" are you speaking of a survey? You'll see in Schedule BII of the American Land Title Policy commitment that title coverage as to area or content is not insured without a proper survey, but the description is. Lots don't generally require surveys for coverage, a meets and bounds description would, but then I can read the description and arrive at it's area and content. The issue is where improvements or easements may be in relation to those imaginary lines on the ground. So, long as title insurance covers the description and the lot area as platted I don't really need a survey unless some encroachment may be an issue. More deals close without a survey than with one.

Welcome to BP!  Where some buy pigs in a poke who know pigs very well. LOL  :)

Thanks for your input now here is what is really happening for the folks that were told they don't need a survey by the pros. in this area.

My sons operate a professional land surveying company here in No. Va.I am stunned by the phone calls they receive every day from homeowners who have purchased their property without the benefit of a “Land Title Survey” and now the “chickens are coming home to roust”.

Now to be sure this is good for their business.But as a professional in this industry, with my clients financial interest as my primary goal, I can’t help but wonder if I don’t have some liability if I were to allow my client to buy “A PIG IN A POLK”. That is without being on record as telling them that they may well need to see exactly what the legal components of their purchase will be. Moreover I am very puzzled why “no land title surveys” have become part of the standard practice for so many transactions.

And it goes well beyond what you can't see on the ground for example I have been a Realtor in Fla. and one of my cases the seller has been paying flood insurance for over ten years and his property was taken out of the FEMA flood zone the year after he acquired the property but his lender was still collecting the money & keeping their part. Now don't start telling about the new FEMA law that no longer allows lenders to get part of the insurance money. I can assure there are thousands no make that tens of thousands of property owners in Fla. alone that should not be pay anybody for flood insurance. But it's going to take a land tile survey to make it happen.

And the land title survey goes even farther I'l tell you of one real life story I came to deal with.  It seems a man who had been transferred to the DC area had contracted to purchase a townhouse in a community I had some dealings with.  He told me he was being threatened with a law suite for specific performance if he did not go through with the purchase of this property.  here's his version.  He contracted to purchase subject to being able to build steps down to the rear yard from the existing deck.  He had contracted with a carpenter to start work the day after settlement.  But when the carpenter went to the building dept. to get a permit he was told that not only was he not getting the permit the existing deck must be removed because it was constructed without a permit and built over an existing county owned sanitary sewer easement.   So let the buyer without a survey beware.??  I have been turning dirty into dollars for 1/2 a century and I know of no professional land buyer that would buy any land without first seeing a survey of the property produced by a PLS they could sue if it wasn't correct

@John Veatch I could not agree with you more. I am a professional surveyor here in Southwest Florida and work in a family company. I am on bigger pockets interested in real estate investing and happened to come across your post. The value of real estate in the general public's eyes has diminished to almost nothing in the recent years, in our experience. With technology increasing substantially and people able to see those lines on GIS websites they no longer care to see a hard copy of a survey or even care to ask where the property corners fall. It is an education process that we conduct on a daily basis to realtors and home buyers and the majority of them still do not care about anything but checking off that box. They all still think we cost too much and do not understand what we do when it comes to conducting a proper boundary survey with the benefit of a title commitment. It is appalling that people do not hesitate to sign a surveyors affidavit to get by without having a new survey complete! Where is the title affidavit?!? Essentially it is the same thing. Surveyors are an insurance policy and it is very important for real estate professionals aka realtors to point that out. Remember, in the long run it is cheaper to hire a good surveyor that it is a bad one or one at all. Russ

There are always those who will step over a dollar to save a dime. If the expense of obtaining a new survey makes it a bad deal, then it was never a deal to begin with. The majority of residential transactions in Texas will use an existing survey that may be 3 y/o or 15 y/o. I require my agents to provide notice, in writing, to all clients that they are highly encouraged to obtain a new survey and to consult with an attorney of their choice if they choose not to purchase a new survey. I want to make sure my brokerage is covered if problem occurs down the line and the finger pointing begins. As an investor, I find the cost of a survey a small price to pay to be able to sleep well at night knowing the surveyor has liability to me for a survey mistake rather than one of the prior 4 buyers. 

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here