When to Use an ALTA Survey for an Acquisition or New Project
Many different parties can use an ALTA survey for their benefit. Title Insurance companies, attorneys, lenders, and developers are the four professional constituencies that are most likely to use a survey.
Broadly used to evaluate an investment in land, an ALTA survey is an essential tool for the design of the structure to be built on land and to validate the viability of a project from the standpoint of a lender.
Performed by a registered, licensed surveyor, an ALTA survey is prepared according to standards determined by the American Congress of Surveying and Mapping (ACSM) and the American Land Title Association (ALTA).
The borders of a property, and the location of any improvements on that property, which may include structures, utility lines, roads, fences, and the location of any and all easements, are shown in an ALTA survey. The ALTA survey often costs more than other types of surveys because of its exceptionally detailed nature. With that said, it is not mandated for all land purchases. Keep in mind, though, that there are times when paying extra for an ALTA land survey makes sense.
Immediately below, you’ll find details concerning when the use of an ALTA survey is recommended or required.
An ALTA Survey Identifies and Locates the Following
- Fences, buildings, and any other improvements from adjoining properties that overstep the borders of the property being acquired;
- Fences, buildings, and any other improvements situated on the property being acquired, which encroach on adjoining properties;
- Fences, buildings, and any other improvements situated on the property being acquired, which encroach on existing easements (access, utility, etc.) that are also situated on the property being acquired;
- Existing record easements, which may harm the future (re)development or use of the property being acquired;
- Possible easements or claims of easements not divulged in public records but suggested by facts on the ground, which may negatively impact the property being acquired
Related: The Ultimate Guide to ALTA Surveys
ALTA/NSPS Surveys for commercial transactions
An ordinary boundary survey may suffice for a property owner if there is no lender involved in the transaction. However, if a lender and a title company are involved, it is likely they will require an ALTA Survey.
Not only does an ALTA Survey indicate boundaries, but it also divulges survey risks. Title companies will generally require an ALTA Survey prior to issuing coverage to a property owner. Survey risks include encroachments, boundary line disputes, easements, and claims that may not be indicated in a survey of public records.
It is often non-recorded risks that present the greatest potential threat to an acquisition. An ALTA Survey can be an essential tool for an owner and a lender to determine whether to proceed with an acquisition or a loan.
Commercial property lenders use ALTA Surveys to ensure value, correct zoning, and the conformation of any development with the corresponding zoning. Since an ALTA Survey adheres to common standards, it provides an excellent foundation for all parties who are engaged in the due diligence effort for an acquisition or new development.
ALTA Land Surveys for Vacant Land
An ALTA land survey may be recommended when buying vacant land, even if it is not required. This is because the vacant property may never have been surveyed at all. It’s also possible that even if it was surveyed, the survey took place at a time when technology was not as accurate as today’s machinery. This means that encroachment, ownership, or border issues may exist. If these issues remain unknown when the property is purchased, they could pose real problems for the new owner later.
An ALTA land survey provides the purchaser with the explorational research needed to unveil and address these problems before the acquisition of vacant land is made.
Related: ALTA Surveys and Appurtenant Easements
Are you a law firm in need of an ALTA land surveying solution? Millman National Land Services provides results you can count on throughout the country. We invite your inquiries.
Timing for an ALTA Survey
While many lenders will elect to have an owner commission an ALTA Survey prior to funding an acquisition or construction loan, the completed survey is just as important at the end of the project to ensure compliance with applicable zoning laws. Also, having the survey done or revised once a project is complete can ascertain whether there have been any deviations from the engineering or architectural plans.
Bear in mind that an Alta land survey isn’t always necessary, and it is not legally required. It’s important to consider the possible risks versus the cost of due diligence. Generally, the question of how expensive and how detailed a survey you need is answered best after a preliminary title report and after a site inspection.
If you discover that you need to have an ALTA land survey conducted, you will need to file a request as a client for the survey. You must arrange for the client to make the request if you are not the client. Written authorization must be submitted to the accredited surveying company by the person responsible for payment.
It’s vital to remember that unless the insurer expressly authorizes the survey costs, the insurance company is not responsible for them. It must be specified in the request that the client needs an ALTA/ACSM or ALTA/NSPS (National Society of Professional Surveyors survey).
At Millman National Land Services, we provide ALTA Surveys and other services to ensure that owners, lenders, title companies, and attorneys have the confidence that their investments are protected. We invite your inquiries and look forward to serving you with our in-house professional staff.