The Ultimate Guide to the Mortgage Survey 2023

Introduction to Mortgage Survey

Understanding the Importance of Mortgage Surveys

A mortgage survey or loan survey is a critical component of any real estate transaction involving a mortgage or loan. Conducting a professional mortgage survey provides key insights into a property’s boundaries, size, topography, easements, encroachments and other physical features. This information allows lenders to assess risks and accurately determine property values when underwriting loans. A mortgage survey provides peace of mind for homebuyers by resolving any uncertainties about what they are purchasing. Given the value a mortgage survey provides, most lenders require a current survey before issuing a mortgage or refinancing an existing loan.

The Role of Mortgage Surveys in Real Estate Transactions

During real estate purchases and refinances, mortgage surveys serve several key functions:

• Establish clear property boundaries – A mortgage survey map precisely identifies the boundaries and dimensions of the property. This prevents boundary disputes with neighbours.
• Detect encroachments – A survey will reveal any encroachments onto the property or easements that may restrict usage. This provides homebuyers with full transparency.
• Assess property value – By providing detailed data on a property’s shape, size, elevations and features, a survey assists lenders in accurately appraising the property value.
• Reduce lender risk – Identifying any red flags on the property upfront allows lenders to factor in potential risks when underwriting loans on the property. This reduces their exposure.
• Comply with title insurance requirements – Most policies require a current mortgage survey to issue coverage. The survey provides the information needed to ensure the title policy accurately reflects the property details.
• Support legal documentation – The survey serves as a key exhibit for the loan closing documentation, providing legally binding details on what is included in the property sale.

How a Mortgage Survey Can Benefit Homebuyers and Lenders

For both homebuyers and lenders, obtaining a mortgage survey is a prudent investment that can prevent larger issues from arising later:

Benefits for Homebuyers

• Confirms exactly what land and structures you are purchasing
• Identifies any existing encumbrances on the property
• Ensures you do not inherit any neighbor boundary disputes
• Allows detection of unapproved structures or zoning issues
• Provides flood zone designation to inform insurance needs
• Gives peace of mind that no defects are hidden off record

Benefits for Lenders

• Enables accurate underwriting by establishing property value
• Reduces lending risks by identifying problems early
• Meets title insurance requirements for new policies
• Protects against future claims or disputes involving property defects
• Provides survey evidence to support foreclosures if needed
• Confirms collateral property meets zoning and permit requirements

What is a Mortgage Survey?

Definition and Purpose of a Mortgage Survey

A mortgage survey, also called a loan survey, is a detailed measurement of a property’s boundary lines, dimensions, elevation, improvements, easements and surrounding details conducted by a licensed surveyor. Its purpose is to thoroughly document the current physical status of a property and identify any issues that may impact title ownership or property valuation for financing purposes.

The mortgage survey protects lenders against unforeseen risks when underwriting loans secured on the property. It also provides homebuyers with full, transparent details about the property’s size, boundaries and any limitations on usage.

Different Types of Mortgage Surveys

Several common types of mortgage surveys may be conducted depending on the specific needs and issues involved:

• Boundary Survey – Maps the perimeter property lines and corners indicate any encroachments.
• ALTA/NSPS Survey – Meets title insurance requirements and shows boundaries, easements, and encroachments.
• Topographic Survey – Documents elevations, contours, drainage and landscape details.
• Flood Zone Survey – Identifies property flood zones as designated by FEMA.
• Location Survey – For properties without existing recorded boundaries or markers.
• Improvement Survey – Details all structures and other improvements on the property.

The type of mortgage survey needed will depend on factors such as property type, age, location, complexity and lender requirements. The surveyor can advise on the best option.

Boundary Surveys

A boundary survey, or perimeter survey, maps the physical boundaries and dimensions of the property lines surrounding the parcel of land. This provides legal documentation of the exact footprint of the property.

Key elements a boundary survey will establish:

• Locations of boundary property corners
• Distances and angles along boundary lines
• Encroachments across boundaries
• Markers such as monuments and stakes
• Connections to adjoining properties
• Easements along boundary lines

Boundary surveys are the most basic type of mortgage survey and are required in many real estate transactions. They ensure all parties clearly understand where the property lines are delineated.

ALTA/NSPS Surveys

ALTA/NSPS surveys are more detailed boundary surveys meeting national standards set by the American Land Title Association and the National Society of Professional Surveyors. These surveys contain detailed information lenders require when underwriting mortgages.

Some key inclusions with ALTA/NSPS surveys:

• Meets minimum accuracy standards for measurements
• Shows structures, fences, roads and other improvements
• Identifies conflicts such as encroachments or easements
• Provides elevations and contours
• Includes aerial images and visual identifiers
• Done to title insurance industry standards

Due to the comprehensive detail provided, ALTA/NSPS surveys are commonly required by lenders for residential and commercial mortgage transactions.

Topographic Surveys

A topographic survey maps the natural and constructed physical features on a property through detailed elevation measurements:

• Contour lines depicting changes in elevation
• Location of mountains, hills, slopes and depressions
• Drainage patterns, watersheds and catchment areas
• Natural water features such as wetlands
• Flood zones, retention ponds and shorelines
• Manmade features such as excavations and mounds
• Vertical obstacles such as buildings and bridges

Topographic surveys help determine potential drainage issues or flood risks that may impact structures on the property. Lenders or homebuyers may request them when concerns exist involving the landscape.

Flood Zone Surveys

Flood zone surveys determine the property’s flood zone as defined by FEMA (Federal Emergency Management Agency).

Key items identified:

• Applicable FEMA flood map for the area
• Flood zone designation (A, AE, AH, AO, etc.)
• Base flood elevation (BFE) if located in a floodplain
• Floodway location if applicable
• Coastal zone determinations
• Historical flood hazards in the area

Lenders often require this survey to assess flood insurance requirements. Having an elevation certificate and detailed flood zone data informs proper insurance coverage.

Legal Requirements and Regulations for Mortgage Surveys

Mortgage surveys must adhere to applicable federal, state and local legal standards. These include:

• Following jurisdictional survey requirements for measurements, staking, monuments, etc.
• Complying with ALTA, NSPS and title company survey standards
• Disclosing any survey discrepancies or potential issues
• Maintaining proper professional licensing and credentials
• Retaining survey records, field notes and evidence
• Providing digital and hard copy versions of the certified survey
• Allowing timely lender review and approval before closing
• Completing any revisions necessary to resolve lender concerns

Reputable surveyors understand the legal requirements and work closely with lenders and attorneys to satisfy mortgage survey obligations.

The Process of Conducting a Mortgage Survey

Pre-Survey Preparation

Completing necessary preparations before fieldwork helps streamline the surveying process and avoid delays:

• Gather background documents – Obtain legal property descriptions, vesting deeds, record maps, prior surveys, title reports, etc.
• Research property records – Check tax assessor records, municipal records, permits, etc., for useful history on the property.
• Contact owner and neighbours – Arrange access to the property and coordinate with adjacent owners if boundary questions arise.
• Review survey requirements – Confirm with the lender the exact mortgage survey type and deliverables needed.
• Secure permits – Obtain any necessary municipal permits for working on public roads, lands or rights of way.
• Schedule field personnel – Ensure proper staffing is scheduled to complete field work efficiently.

Gathering Relevant Property Information

The surveyor will collect the following information to provide context on the property:

• Legal property description from vesting deed
• Recorded plat/map of property boundaries
• Title report detailing any recorded easements or encumbrances
• Tax assessor records with property dimensions and acreage
• Existing survey maps from municipal records
• Zoning maps and building records
• Aerial photos providing landmarks and context

Reviewing Existing Survey Records

The surveyor will gather any prior surveys, records and maps associated with the property. These are analysed to understand past survey methods, monument locations, boundary lines, discrepancies, and changes over time.

This evidence aids the surveyor in evaluating boundary locations and avoiding contradictory or erroneous data. Relying solely on outdated or flawed records can compromise accuracy.

Coordinating with Property Owners and Stakeholders

Contacting the property owner and other stakeholders facilitates access logistics for field personnel. The surveyor may request:

• Escorted access to the property
• Unlocking gates or disabling security systems
• Advice on accessing restricted areas
• Notifications to tenants/occupants of pending survey
• Contact information for neighbours if cooperative boundaries are needed

Proper communication allows surveys to run efficiently and minimises disturbances.

Fieldwork and Data Collection

During fieldwork, surveyors physically locate boundaries and features of the property through careful measurements:

• Identifying boundary corners – Finding original monuments or placing new markers at corners.
• Checking boundary lines – Measuring lines between corners and angles at bends. Compared to record details.
• Mapping topography – Recording elevation contours and high/low points via level loops.
• Measuring improvements – Detailing all structures, fences, paving, and utilities on the property.
• Locating easements – Identifying any visible public or private easements.
• Observing encroachments – Watching for fences, sheds, decks, or utilities over boundary lines.

Utilising Advanced Surveying Equipment and Techniques

Current survey practices utilize a mix of high-precision digital instruments and traditional tools:

• Total stations – Electronic for measuring angles and distances
• GPS equipment – Satellite-based location and elevation data
• Robotic total stations – Automated tracking and measuring
• 3D laser scanning – Highly detailed topographic mapping
• Drones – Aerial data gathering over large areas
• Digital levelling – Precise elevation leveling using encoded rods
• Traditional tools – Steel tapes, plumb bobs, theodolites

By leveraging the latest survey technology and time-tested methods, comprehensive data accuracy and completeness can be achieved.

Identifying Property Boundaries and Markers

Boundary determination relies on locating original surveying monuments positioned at property corners, such as:

• Iron rods/pipes – Most common permanent corner markers
• Cut crosses – Marks carved into curbs, concrete or asphalt
• Drilled holes – Holes drilled into curbs, rocks or boulders
• Stone monuments – Inscribed granite or sandstone blocks
• Wood stakes – Temporary markers often long-deteriorated

If original monuments are missing, the surveyor places new markers stamped with their license number, typically iron rods driven into the ground. Permanent monuments provide conclusive proof of boundary locations.

Assessing Topography and Elevation

Topographic surveys collect data on a property’s elevation, landscape and natural features. These details are measured and mapped:

• Ground elevation across the site
• Contour lines depicting elevation changes
• Slopes, hillsides, drainage swales and catch basins
• Streams, wetlands, ponds and floodplains
• Cliffs, sinkholes, watersheds or similar land formations
• Fences, paths, trees, gardens and other land improvements

This information indicates where water runoff flows, identifies steep grade changes, and reveals potential flood risks on the property.

Evaluating Potential Encroachments or Easements

The survey field crew visually inspects the property for any potential encroachments, legal easements or access rights that may impact the property. Typical items checked:

• Structures or fences extending over boundary lines
• Shared driveways/access with neighbours
• Utility lines crossing the property
• Drainage ditches affecting the site
• Visible public utility easements
• Shared community fences or other agreements

Any evidence of encroachments or easements is documented to disclose to the lender and homebuyer during the transaction.

Data Analysis and Interpretation

After fieldwork is complete, the surveyor analyses the measured data points and recorded observations to develop the mortgage survey deliverables:

• Ensure measurements meet required precision standards
• Confirm property corners are consistent with record details
• Reconcile any discrepancies found in the field
• Detect any encroachments, gaps or overlaps
• Interpret field evidence of easements or encumbrances
• Integrate topographic readings and feature locations
• Cross-check data with aerial/satellite imagery if available

Thorough analysis provides meaningful conclusions from the raw survey data collected.

Creating Accurate Survey Maps and Plans

The surveyed measurements, notes and details are compiled into deliverable drawings showing the property features:

• Boundaries – All boundary lines, corners and dimensions
• Improvements – Footprint of buildings, driveways, pools, etc.
• Topography – Contours, elevation callouts, drainage
• Nearby features – Roads, streams, and utilities in vicinity
• Observations – Encroachments, easements, monuments
• Metadata – Contact/license info, survey methodology

Computer-aided drafting and design (CADD) enables precise digital maps that can be easily reproduced and shared.

Identifying Potential Issues or Discrepancies

The surveyor highlights any evidence found that may indicate issues impacting the property:

• Disagreement in measurements or boundaries compared to records
• Previously unrecorded easements observed
• Structural encroachments beyond property lines
• Non-conforming outbuildings or additions
• Topographic features indicating drainage problems
• Vulnerability to flooding or similar hazards

Full transparency on discrepancies helps lenders make informed decisions when evaluating associated risks.

Collaborating with Other Professionals

Surveyors often collaborate with additional stakeholders during the mortgage survey process:

• Title Companies – Provide title reports and records, request extra coverage items per ALTA/NSPS standards, rely on surveys for policy underwriting.
• Attorneys – Check that the survey meets all state legal requirements ensure it will withstand legal scrutiny if boundary disputes occur.
• Appraisers – Use survey details such as square footage to determine property valuations needed for lending.
• Insurance Agents – Determine proper flood and hazard insurance coverage based on survey flood zone designations and risk factors.
• Municipal Officials – Provide access to public records and maps and assist in identifying easements or encumbrances.

Reporting and Documentation

The surveyor produces a detailed report of findings to provide lenders and owners with permanent documentation of the property’s assessed legal and physical status.

Report elements may include:

• Survey maps, plats and drawings
• Property description with metes and bounds
• Observations of encroachments and easements
• Topographical depictions
• Flood zone designation
• Digital imagery and photos
• Record of monument locations
• Applicable notes and disclaimers

Preparing a Comprehensive Survey Report

The completed survey report will compile all relevant data, analysis and conclusions:

• Title page – Property address, owner, lender, survey purpose, preparer details
• Survey maps – Boundary map, topography, aerial overview, etc.
• Legal description – Metes and bounds detailing perimeter boundaries
• Observations – Encroachments, easements, discrepancies, risks
• Elevations – Topographical contours, finished floor elevations
• Ground cover – Landscape, forests, wetlands, flood zones
• Improvements – Buildings, pools, fencing, paving
• Survey data – Benchmark, reference coordinates, measurement methodology

Including Relevant Findings and Recommendations

The surveyor outlines notable findings that may warrant actions:

• Encroachments – Identify structures or features extending beyond property lines.
• Easements – Highlight any observed public or private easements across the site.
• Boundaries – Note any gaps, overlaps or uncertainties on exact boundary lines.
• Non-compliance – Call out structures lacking proper permits or zoning setbacks.
• Flood risks – Specify flood zone designation and advise elevating structures appropriately.
• Discrepancies – List any substantial conflicts with existing records found.

Ensuring Compliance with Legal Standards and Guidelines

To ensure defensibility of the survey, all work must adhere to applicable jurisdictional regulations:

• Follow relevant state statutes governing surveys and mappers
• Comply with accuracy standards for ALTA/NSPS Land Title surveys
• Utilize proper documentation as legally defined
• Maintain responsible charge as a registered surveyor
• Retain field evidence and records demonstrating due diligence
• Survey only within the licensed scope of expertise and geography

Documented compliance provides reliability if the survey conclusions are ever legally disputed.

Benefits of Conducting a Mortgage Survey

Ensuring Property Ownership and Boundaries

A mortgage survey provides legal documentation on the property’s boundaries, which offers multiple benefits:

• Confirms the legal footprint and acreage being purchased
• Reduces risk of disputes with neighbours over fencelines or structures
• Catches any encroachments across boundary lines early
• Ensures the deed and title policy accurately represent the site
• Allows detection of unauthorised changes or easements
• Provides evidence to resolve any future boundary disagreements
• Establishes a basis for land transfers, easements, or property division

Reliable boundary data gives peace of mind on what the owner legally owns and where the lines are drawn.

Avoiding Boundary Disputes and Legal Issues

Boundary disputes between property owners are common and can lead to contentious legal battles. A recent mortgage survey helps avoid such issues by:

• Providing authoritative boundary locations before the transfer
• Settling any uncertainty over fence lines or possession
• Proactively finding encroachments before problems emerge
• Discovering unauthorised easements across the property
• Having a legal record of boundary extents if later challenged
• Enabling title insurance coverage for boundary defence

With definitive boundary documentation, the property can transfer free of disputes.

Identifying Encroachments or Easements

The survey process inspects for any encumbrances that could limit usage of the property, such as:

• Structures or fences extending from neighbours across property lines
• Utility lines and drainage ditches crossing the property
• Shared driveways lacking recorded easements
• Visible public utility easements not on record
• Unauthorised access paths worn across the site

Identifying encumbrances early avoids unpleasant surprises later and allows time to resolve issues prior to closing.

Assessing Property Value and Potential Risks

By mapping topography, improvements, and boundaries, the survey provides lenders data to determine property value. Findings also reveal risks:

• Topography showing problematic drainage or landslide risks
• Presence of wetlands or other restrictive land features
• Legal non-compliance of structures near boundaries
• Omission of easements needed for access
• Flood zone designation indicating insurance requirements

With risks and liability concerns disclosed upfront, lenders can underwrite loans on the property appropriately.

Evaluating Topography and Drainage

The survey’s topographic mapping helps assess drainage patterns, watersheds, and flood susceptibility:

• Highpoints and depressions affecting runoff
• Steep grades, erosion zones and unstable slopes
• Watershed boundaries and on-site catchment basins
• Wetlands, shorelines, and other water features
• Floodplains, floodways, and base flood elevations
• Prior flood hazards and event water levels

This data helps guide construction plans to avoid drainage issues. It also informs needs for retaining walls, drainage infrastructure, and flood prevention.

Identifying Flood Zones or Hazardous Areas

Surveys determine flood risk by identifying:

• Published FIRM flood maps covering the property
• FEMA flood zones (A, AE, AH, etc.) encompassing the site
• Base flood elevations from historical records
• Any mapped floodways crossing the property
• Evidence of prior flooding or high water marks

Proper flood zone identification is crucial for securing appropriate flood insurance.

Facilitating Smooth Real Estate Transactions

The survey facilitates a trouble-free closing by:

• Providing all parties with clear expectations
• Avoiding last-minute disputes on property condition
• Fulfilling lender requirements to secure financing
• Preventing delays from unresolved title issues
• Supporting accurate drafting of closing documents
• Enabling title insurance issuance without exceptions

Buyers, sellers, and lenders can confidently sign off knowing the survey has addressed any potential property concerns.

Providing Accurate Property Descriptions

The survey report delivers definitive legal descriptions of the property:

• Boundary perimeter dimensions and bearings
• Precise site acreage and square footage
• Easements and encroachments documented
• Detailed topography and plot elevations
• Locations of improvements mapped
• Metes and bounds description for full legal definition

Accurate descriptions prevent discrepancies in legal filings and ownership records down the line.

Assisting in Title Insurance and Lender Requirements

The survey provides information needed by title companies to issue policies and lenders for underwriting loans:

For Title Insurance

• Identifies potential title risks to disclose upfront
• Satisfies survey requirements to provide coverage
• Supports accurate legal description in policy
• Provides evidence to defend against claims

For Lender Underwriting

• Confirms collateral property size and value
• Declares any RED FLAGS on the property early
• Meets loan condition requirements
• Demonstrates due diligence to reduce liability

A comprehensive, ALTA-standard survey enables title and loan processes to move forward unimpeded.

Enhancing Buyer Confidence and Trust

The survey gives homebuyers confidence they know what is included in the purchase:

• Removes doubt regarding property boundaries
• Identifies any encumbrances limiting usage
• Provides insight on drainage and flood risks
• Detects hidden issues lurking off-record
• Reduces chances of unpleasant surprises down the road

Buyers can trust they are making informed decisions with eyes wide open regarding the property’s realities.

Factors to Consider When Hiring a Mortgage Surveyor

Qualifications and Credentials

When selecting a surveyor, first verify their qualifications:

• Licensed – Legally licensed in the state to perform surveys
• Experienced – Background in surveying with mortgage mapping expertise
• Insured – Carries proper liability insurance coverage
• Reputable – No complaints or disciplinary issues on license
• ALTA Certified – Completes special training on ALTA/NSPS standards

Experience and Expertise in Relevant Survey Types

Seek out specialists matching the type of mortgage survey required:

• Boundary Surveys – Versed in boundary law, title transfers, dispute resolution
• Topographic Surveys – Skilled at elevation mapping, contouring, and drainage patterns
• ALTA Surveys – Thoroughly familiar with ALTA/NSPS standards
• Flood Zone Surveys – Knowledgeable on FEMA flood maps and zones
• GPS Surveys – Leverages the latest GPS and robotic survey technology

An experienced surveyor in the niche is needed to provide optimal results.

Reputation and Client Testimonials

Check sources such as industry references, online reviews, testimonials, and referrals:

• Industry experts – Title officers, lenders, attorneys
• Former clients – Buyers, sellers, real estate agents
• Online reviews – Google, Yelp, Angie’s List
• Professional networks – Affiliations, referrals
• Better Business Bureau – Complaints, resolutions, ratings

A longstanding reputation for quality and professionalism is a good indicator.

Cost and Timeframe Considerations

Factor in cost, timing, and resource needs:

• Fixed fee or hourly? – Get clear estimates and price plans
• Turnaround time – How soon can the work be completed?
• Staffing – What personnel will be performing the work?
• Fieldwork conditions – Are factors present that complicate logistics?

Understand all aspects of the scope, budget and logistics required.

Communication and Collaboration Skills

The surveyor should demonstrate:

• Responsiveness – Timely replies to inquiries and access needs
• Clarity – Clear scope documents detailing work and terms
• Experience – History cooperating successfully with lenders, title officers, appraisers, etc.
• Documentation – Keep stakeholders informed with progress updates
• Problem-solving – Work through any issues encountered with notifications

Surveying requires close collaboration between all parties. Ensure your surveyor communicates well.

Common Challenges and Pitfalls in Mortgage Surveys

Inaccurate or Outdated Survey Records

Existing records may have flaws:

• Original monuments missing
• Fences not aligned with plats
• Structures encroaching on lines
• Easements not shown on subdivision maps
• Changes to the terrain over decades

A current survey identifies discrepancies. Reliance on old records can propagate mistakes.

Disputes over Property Boundaries

Adjoining owners may dispute boundary lines:

• Confusion over which markers are authoritative
• Disagreement on easement limits
• Fences not consistent with record boundaries
• Shared driveways without easements
• Tree encroachment from adjacent parcels

Getting aligned in advance prevents conflicts.

Encroachments and Easement Issues

Encroachments found can complicate transactions:

• Houses, decks, or sheds over boundaries
• Utility lines crossing parcel without easement
• Neighbor fences or gardens in the property
• Drainage ditches or channels affecting land
• Unauthorized access paths are worn on property

The surveyor must flag all encroachments for correction.

Environmental Factors

The site may have adverse physical conditions:

• Steep slopes, soil instability, drainage issues
• Wetlands, flood zones, or fire hazards
• Streams, watersheds, shoreline encroachment
• Endangered species habitats
• Contamination from past land use

Environmental risks get disclosed upfront before closing.

Mortgage surveys play a vital role in real estate transactions by establishing detailed facts on the property’s boundaries, improvements, easements, encumbrances, topography and compliance. Surveys bring peace of mind for homebuyers by answering all questions about what the property includes. For lenders, surveys reduce underwriting risks by surfacing any issues early. When selected and performed diligently by qualified professionals, mortgage surveys deliver benefits for all parties involved in securing real estate financing.

Conclusion

In summary, mortgage surveys provide critical insights that benefit all stakeholders in real estate transactions. A current survey establishes clear property boundaries for buyers, discloses any encumbrances, and reveals potential risks before purchase. Lenders gain the detailed information needed to assess property value and make informed underwriting decisions accurately. The survey also meets title insurance requirements for new policies covering the loan. By proactively addressing uncertainties, a mortgage survey facilitates smooth closings and prevents future disputes. Selecting an experienced, reputable surveyor and specifying the appropriate type of survey ensures the investment will pay dividends. A high-quality mortgage survey is essential due diligence when buying, selling, or financing real property in a real estate market with climbing property values.