There are several advantages to being a cash buyer that simplify the process of purchasing a piece of real estate. However, there are additional issues that cash buyers need to be aware that can impact the purchase of property. One of those issues is the importance of a mortgage survey or plot plan.
You may be wondering what a plot plan is, do you really need one and is there an additional cost for a plot plan? The simple answer to these questions are that a plot plan is an engineering diagram or drawing of the estimated boundaries of the property. The plan is created by a Professional Land Surveyor. The plan will indicate the precise location of any major structures on a particular property, including any houses, porches, sheds and in some case driveways and access points. It will also show the approximate shape of a lot as well and the approximate location of structures as they relate to boundary line setbacks.
In some cases where there are multiple lots, the plan may also show the location of each particular lot in relation to the other.
The information disclosed by the plan is important, especially when there may be encroachments, missing lots, or the lots or the property description is not what YOU think it is. A title exam conducted as part of the closing will reveal the owners of the property and any encumbrances or defects that may be of record. A title exam does not show the location of any of the buildings or structures on located on the land.
A conventional bank or mortgage lender will always require a Mortgage Survey as a condition to lending any money on property. A cash purchaser is not required to obtain a plot plan as a condition of the purchase, even though it is highly recommended. The bottom line is that a plot plan may reveal additional information about a property you may not know about. Having a plot plan conducted as part of your due diligence process can save you thousands of dollars by disclosing critical issues before you close.
The cost of a residential mortgage survey is around $150.00, depending on the size of the lot and structures located on the lot.
If you are paying cash for a real estate purchase, contact our office and we can guide you through the process and answer any questions you may have.