Will that survey work?

No one wants to hear that the title company or lender’s underwriter won’t accept the survey days before closing. Agents need to understand that not just any survey can secure title insurance or satisfy the lender’s requirements for property approval.

The owners of Halo Surveying—Kiersten “Kris” Crawford, Broker/Owner and Texas REALTORS® senior instructor, and James Crawford, Registered Professional Land Surveyor —suggest asking your clients these questions.

Do you have a survey?

Your clients may not have a survey. Surveys are often lost or may have never been completed, especially if the property has been in the family for generations. Agents will want to find out if their clients have an existing survey to adequately complete the survey provision of the applicable purchase contract. Even with an existing survey, it’s prudent for buyer’s agents to recommend an updated/new survey. Why? Because time will have passed since the original owner purchased the property, and new problems may have arisen.

What kind of survey is it?

Surveys come in many types, such as boundary surveys, site plans, and topographic surveys. For your clients to secure title insurance, they’ll need a land title survey. This type of survey specifically outlines property boundaries, ownership lines, rights of way, and easements both on and around a property.

It’s possible your clients may have a boundary survey, which will not address the restrictions or Schedule B items outlined in a title commitment, which ultimately affects what will and will not be covered by a title policy.

Ask the seller to provide the survey and T-47 Affidavit or T-47.1 Declaration to help determine what type of survey it is. Surveys will be signed by a licensed surveyor and will have an official surveyor’s seal. Check out the survey’s disclaimers. A phrase such as “provided without the benefit of an abstract of title” would let you know it is not a land title survey. To avoid last-minute closing delays, agents should ask the title and lender underwriters to review the survey in advance to confirm if the survey will be acceptable, especially if the buyer wants what’s commonly called survey coverage, which is discussed further below.

Is it up to date?

Even the right type of survey could be unacceptable. Each title/insurance underwriter determines what is acceptable. It’s directly related to the risk of potential claims against the insurance policy or the lender’s confidence in the collateral. Ask your client if anything has changed onsite since the survey was completed. If there have been improvements, such as a new fence installed, you will likely need a new survey.

Is it worth getting a new survey?

Surveying technology has improved significantly in recent years. It’s not uncommon to discover that a property is larger or smaller than originally surveyed—meaning the property may be more or less valuable than the property owner or buyer thought. A new survey may be more precise and contain more accurate and detailed information. Not ordering a new survey could be very costly. Your client could be forced to remove a newly built structure, find the property uninsurable, or be unable to use it as loan collateral. Ultimately, a missing survey could severely diminish the property’s marketability and value.

Do you know about survey coverage?

Survey coverage is an affordable addition to your title insurance policy and provides coverage against discrepancies, conflicts, boundary line issues, encroachments, protrusions, and overlapping improvements. It covers errors and omissions by the surveyor. Without it, your clients will pay much more to settle potential issues that arise. If clients have further questions on how the survey coverage will benefit them, direct them to speak with the escrow officer or attorney, who may put them in touch with the insurance company issuing the title policy.

Are you paying with cash?

It’s possible that cash buyers will be told by an escrow officer or lender that they do not need a survey. This leaves cash buyers not knowing exactly the amount of property they’re buying. They also risk facing problems surveys might catch, like encroachments or protrusions. Let your clients know the dangers of proceeding without a survey. All the TREC purchase contracts (except the condominium purchase contracts) provide that a survey may be provided by one of the parties.

Remember, a survey is a graphic depiction of the land and its legal encumbrances and improvements based on a physical inspection and title examination. A survey provides the only way your buyer or seller will know what property is being bought and sold.