It's interesting to see how this works around the country. Back in the late seventies early eighties when the economy was booming (here anyway) I did lots of these mortagage inspection surveys. They were generally for new houses in the subdivisions that I was laying out so I already had the property lines located and the monuments set leavinf me to locate the house I had already staked and check the driveway, fences, services, ect. Simple. In the older parts of town I would always do a real survey (and other surveyors in town also did) and set monuments. I charged a lump sum large enough to cover the cost of one hard survey I would do for every five or so easy ones. That way the bank would have a set fee for the service.
Now each title company will write an exception for the survey so there are basically no surveys coming from the banks. And since there have been few developments in recent years it is expensive to do a survey and they balk when you give them a cost for a "simple lot survey".
It's OK with me since it was never a big part of my business anyway; but it does sound like it is the main business model for many surveyors in other parts of the USA.
If the Title Industry begins to treat the rest of the country like they do this part that business model will just fade away. I also wonder how many of the Title people are using the electronic data available to make decisions about bounday lines/encroachments.
It's not just about the buyers - They aren't even serving as advocates for THEMSELVES.
Title insurers expose themselves to unnecessary risk and liability by flying without a survey, as do lenders.
> There is no one at a typical real estate closing looking out for the buyer. That is a defect in the way the system is set up.
That is what the buyer's lawyer should be doing.
Peter Lazio
Title insurers expose themselves to unnecessary risk and liability by flying without a survey, as do lenders.
I used to think that also. But ask yourself this. How many times have you seen a Title company pay off on a claim? I've seen it once. That was just a mistake the Title company did when filing a deed.
I'm working on one right now where the title co has been called in to defend their policy.
About ten years ago I read an article about the percentage of claims arising from policies regarding surveys. There were less than 1% of claims. The title industry, as the lenders, have regarded the small amount of claims as an indication that a survey is not really necessary for a closing. Like it or not, that's just the way things are. We can debate argue and surmise all we want about the lack of surveys being required/ordered, however...it ain't in our control.
What is in our control is when the attorney/title co./land owner calls us because there is now a festering problem coming to head that could have been avoided by getting a survey.
For most people the biggest investment they will ever make is purchasing a home. Why on Gods green earth would you ever do so and not have a survey done? Many will purchase Owners title insurance...but do they ever read schedule "B". There are exclusions. I know, I am preaching to the choir.
These same people will also purchase life insurance, medical insurance, comprehensive car insurance etc. You only die once so the life ins policy is for the benefit of someone else. You can have several years of medical problems so that premium seems necessary. Vehicles are totaled every day....so that insurance can be seen and recognized (possibly) in a very short time. But through all that mess listed very few recognize the value of a survey to add and complete the piece of mind a title insurance policy can offer. But they will spend thousands on other premiums. Until....it too late..so where are their priorities?
The real estate industry will not promote Land Surveys. They just simply won't. They don't want to because it serves as no service/return for their perceived value of what they do.
Keep in mind that insurance companies are not in business because they feel a need to help. They are in business to make money. It's risk factor...they are not in business to payout claims.....they are there to collect premiums and payout as few claims as possible. They could care less about you....but they care an awful lot about the little greenback that keeps their business rolling.
I've done 1000's of these, when I worked in Nebraska, and I agree with Sam. But I would add; if we did find conflicts, we would advise the client that there were potential problems and these are our rates to do a boundary survey.
This happened about %5 of the time(just a SWAG), most of the time, there wasn't a problem and everybody was happy.
Radar
So, how do you show the location of an improvement or encroachment if you do not know for sure where the property line is located? This type of document appears to be meaningless. Sounds a lot like those old transmission adds where the guy says,"Yeah I can fix that, but I ain't guaranteeing it.". What is the value or validity of such a SWAG sketch?
How many home buyers have a lawyer present at closing?
Actually, they seem like a good idea to me. In my experience, 90% of the time you can discover a major problem (house over the line, for example) in the first 15 minutes on the job.
"must rant here a bit"
9 out of 10 times whether it is a bank, client or real estate agent - what they ask of and only want a surveyor to do will limit our purpose and responsibilities to the public as requested by our State BOR and they don't care if they get a survey, they want somebody's signature on the bottom line for the money involved, not anyone's welfare.
There will always be some jacklegg out there that will run in and place some irons in the ground or show where improvements are without any regard to being brought to the light of day that they are wrong, because they bank on the fact that for the meager cost they impose, nobody will complain.
"being within a few feet or yards of correctness does not matter to a cheapskate"
"rant over"
It does not compute to me when an individual or agency wants and expects anyone/everyone to pay any fee for something that is useless, but it greases the wheel.
I consider my purpose as a surveyor to do what is required and I am not responsible for anyone's happiness today, but am responsible for their knowing that I do a complete survey that is correct and will stand from now on.
😉
Maybe you're right, it's just a numbers game to them.
But in my opinion, it's still bad business, just the same.
Maybe just 1%, but that 1%er that totally goes kablooey could still potentially set a title company back.
Gunter:
1% would likely set the title company back if they were actually forced to buy 1% of the houses they insure. More likely it's that 1% of the policies (if that) result in some sort of claim, and they're forced to do some legal work, buy some disgruntled claimant off, buy an access easement, whatever -- the claims against them I've actually heard of have involved relatively small amounts.
If anyone knows some "horror stories" wherein the insurers have paid out huge amounts, please post!
