What you should know when purchasing real property

Often a Title Insurance firm will make an offer to the concerned parties to hire a Land Surveyor to produce a Land Survey for their real estate transaction.

 

The agreements between the Title Insurance firm and the Land Surveyor often are made with the understanding that the Land Surveyor will continue to get work orders from the Title Insurance firm if they will not be paid for the Land Survey if the transaction does not close, the Land Surveyor will produce the Land Survey at an artificially low price and the Land Surveyor will produce the Land Survey in a short and set time limit. These types of agreements are a violation of the Real Estate Settlement Procedures Act (http://www.marealtor.com/content/respa.htm) in my opinion.

 

The presumption that the Land Surveyor is a disinterested third party evaporates in a circumstance where the Land Surveyor is only paid if the transaction closes. A Land Surveyor can be tempted to not make a thorough search of the Public Records or evidence found in the field if their budget is exceeded in the process of producing the Land Survey. A Land Surveyor can be tempted to not make a thorough search of the Public Records or evidence found in the field if such an endeavor would cause them not to meet the deadline for delivery of their product.

 

In the case where errors are found in the description of the subject property provided to an independent Land Surveyor by the Title Insurance Firm, the Title Insurance firm will not be happy when contacted to report problems found. An Independent Land Surveyor's findings potentially may delay the closing. This is why I recommend that you should always hire an independent Land Surveyor when entering into a real estate transaction.

The Problems

The problems found by an independent Land Surveyor potentially may save thousands of dollars and untold headaches in the future. In many cases the lower fee charged by the Land Surveyor hired by the Title Insurance firm is actually more expensive than the fee charged by an independent Land Surveyor because the fees charged by the Land Surveyor hired by the Title Insurance firm are simply made part of the loan. The interest payments alone on those fees, over the time period of the loan, often far exceed the cost of an independent Land Survey many fold.Problems found by an independent Land Survey can be used to negotiate the price and terms for a transaction on real property between the concerned parties, thus more than covering the fee for an independent Land Survey.

In Real Estate

Most real estate professionals involved in a real estate transaction have vested interests in the transaction closing. Many people have no experience in a real estate transaction yet a home in most cases is the most expensive item they will ever purchase in their lifetime. A Land Surveyor should never have any interest in the real estate transaction they are producing a Land Survey for.

This Content Originally Published to Land Surveyors United Network

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Subject Tags: Land, Purchasing, Survey, Surveyor, boundary, estate, real

Say Something ⇣

Reply by Ty Olinghouse on February 2, 2011 at 10:41pm

I totally agree Karl..

 

i might add that is also a violation of minimum standards in alot of states, alot of states, AZ being one requires a written agreement for services.

 

work with a title company can help get your business off the ground, and get you started, and is a tough way to make a living sometimes, being under such demands

 

this is where i think, educating the public goes alot further... the title attorneys are not considered as Joe blow, and they don't want to hear about the problems we found on there survey they just ordered

 

"i don't want the labor pains, i just want the baby" attitude is pushing surveyors to extinction,  if they don't comply, there is someone who will WTH?

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