Table A Item 20 is a new optional item in the 2026 ALTA/NSPS Land Title Survey Standards. When a client requests it, the surveyor produces a summary table of significant conditions observed during the survey, such as potential encroachments, setback concerns, and access issues. It doesn’t create new findings. It pulls what’s already on the survey and puts it in one place.

The ALTA/NSPS Standards follow a roughly six-year revision cycle. The 2026 edition follows the 2021 edition, and Item 20 is one of the more notable additions in this round.

Why the Industry Needed Table A Item 20

ALTA/NSPS surveys have grown more detailed over time. A single commercial survey can span dozens of sheets covering boundary lines, easements, encroachments, utilities, and access conditions. Every party in a transaction, including the lender, the title insurer, the buyer’s attorney, and the developer, had to review those sheets independently to find what mattered most to them.

That process is slow. It also leaves room for something important to slip through.

The ALTA/NSPS Standards Committee responded to direct industry feedback: surveys didn’t have a built-in way to surface critical findings without a full document review. Commercial transactions typically run on a 30-to-45-day due diligence window. Survey review is just one of several things happening at the same time, so the pressure is real.

Item 20 addresses that directly. The surveyor compiles the most significant observations already identified during the survey into a single table. One document. One pass.

What Goes Into a Table A Item 20 Summary

The summary can include any of the following observed conditions:

• Potential encroachments: structures or improvements that appear to cross property lines or easement boundaries
• Setback concerns: buildings or features that may sit closer to setback lines than zoning allows
• Access issues: questions about whether the property has legal access to a public road
• Other notable physical conditions: anything observed in the field that could affect the use or transfer of the property

The key word is “observed.” The surveyor records what they can see and measure on the ground. The table collects those observations and puts them front and center. It doesn’t interpret them, assign legal meaning to them, or settle ownership questions.

Think of it as a highlight reel pulled from the full survey. Nothing in the summary is new. All of it was already documented.

How Item 20 Supports Due Diligence

The 2026 Standards now include 21 optional Table A items. Item 20 is one of the few that directly addresses how survey findings get communicated to non-surveyor reviewers, which is where much of the value sits.

Each party in a commercial transaction reads a survey through a different lens:

Item 20 doesn’t replace a full survey review. It gives every party a faster starting point, and it reduces the chance that a significant observation gets missed because it appeared on page 18 of a complex drawing set.

What a Surveyor Is Not Doing With Item 20

This is worth being clear about. The 2026 Standards are explicit: surveyors are not providing legal opinions, making ownership determinations, or drawing conclusions about whether an observed condition creates a legal problem.

The surveyor’s role is observation and documentation. Item 20 doesn’t change that.

A practical example: if a surveyor observes a fence that appears to cross the boundary line by four feet, that goes into the summary. Whether that fence creates an encroachment claim, and what to do about it, belongs to the attorney and the title company. The surveyor’s role ends at “here’s what I saw.”

That distinction matters for liability. It also keeps the survey focused on what surveyors are qualified to do.

When to Request Table A Item 20

Item 20 is optional, so it won’t fit every project. It adds the most value when a transaction is complex and multiple parties need to review the same survey.

Good candidates include:

• Commercial acquisitions where several stakeholders are reviewing the survey
• Refinancing transactions where a lender wants to confirm no new physical concerns exist
• Development projects where setbacks, easements, and access issues affect site design
• Properties with multiple buildings or parcels covered by a single survey
• Deals with investors, co-lenders, or joint venture partners, each doing independent review

It’s less useful for straightforward, single-use properties with a small review team. A simple net lease on a small retail pad probably doesn’t need it. A multi-building industrial portfolio almost certainly does.

The added scope is generally modest. Item 20 draws from observations the surveyor already made during the standard survey process. In most cases, it doesn’t require new fieldwork.

If you work in commercial real estate, you have probably seen an ALTA/NSPS Land Title Survey come up during a property deal. These surveys are a key part of buying or selling commercial property, getting title insurance, and doing proper due diligence. In 2026, the ALTA/NSPS standards got an important update. Knowing what changed helps everyone involved in a transaction stay on the same page. This post breaks down the main differences between the 2021 and 2026 versions in clear, simple terms.

Why the ALTA/NSPS Standards Were Updated in 2026

Rules do not stay the same forever, and that is a good thing. The real estate industry changes over time. New tools, new types of deals, and new ways of communicating push professionals to take a fresh look at how they work.

The ALTA/NSPS standards go through a formal review process. Surveyors, title companies, lenders, and attorneys all take part. Together, they look for areas where the old language causes confusion or where clearer guidance would help. The 2026 update is not a full rewrite. It is a careful set of improvements designed to make surveys more consistent and easier to use for everyone.

Think of it like updating a shared rulebook. The goal stays the same, but the instructions get clearer with each revision.

Definitions and Terminology Changes Introduced in the 2026 Standards

Language is one of the most common sources of confusion in any profession. When two people read the same word and come away with different meanings, problems follow. The 2026 standards deal with this by updating key definitions and making the language more precise in places where the 2021 version was not specific enough.

Some words and phrases that used to have loose meanings now carry clearer definitions. This helps surveyors know exactly what a lender or attorney needs when they ask for a specific survey item. It also helps title companies review finished surveys with more confidence.

On top of that, shared terminology cuts down on unnecessary back-and-forth. Instead of stopping to debate what a term means, all parties start from the same understanding. That saves time and reduces the chance of errors during a transaction.

Revisions to Table A Optional Items

Table A is one of the most hands-on parts of an ALTA/NSPS survey request. It is a list of optional items a client can ask the surveyor to include in the survey. Common examples are parking counts, flood zone details, and building setback measurements.

In the 2026 update, some Table A items were changed. Others got clearer explanations so that clients and surveyors read them the same way. A few items may also have been reorganized to make the table easier to read and use.

These changes matter because Table A sets the scope of the survey. When a client picks an item that now has a clearer definition, both the client and the surveyor know what to expect. As a result, there are fewer surprises when the finished survey comes in.

Before ordering a new survey, clients should go over the updated Table A with their surveyor and confirm which items fit their specific deal.

Updated Requirements for Deliverables and Survey Documentation

How a survey gets put together and handed over matters just as much as what it contains. The 2026 standards include updates to the documentation side of ALTA surveys, keeping up with how professional practices and technology have shifted since 2021.

Surveyors may now have updated guidance on certifications. A certification is the formal statement in a survey that confirms it meets the required standards. There may also be clearer direction on records research, which is the process of checking public records to find information about a property.

Digital files are also becoming more important as more deals rely on electronic records. The updated standards help make sure surveys work well in digital systems. Because of this, both surveyors and clients have clearer expectations about file types and how surveys get delivered.

How the 2026 Standards May Affect Commercial Real Estate Transactions

The 2026 updates have real effects on commercial property deals.

First, lenders and title companies may start requiring surveys that follow the 2026 standards for new transactions, even if a property already has a survey done under the 2021 rules. Because of this, buyers and sellers should find out early which version applies to their deal, before any deadlines are set.

Second, some changes may affect how long a survey takes or what it costs. If new documentation steps or Table A revisions add work to the process, timelines and budgets can shift. Talking early with the surveyor, attorney, and title company helps everyone avoid surprises at closing.

Finally, developers and lenders who manage several deals at once should make sure their teams know about the 2026 changes. Staying current helps keep transactions moving without unnecessary holdups.

The 2026 Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys took effect on February 23, 2026. Any survey contracted on or after that date must follow the new rules. Prior versions no longer apply.

This isn’t a reinvention. Most transactions won’t see a meaningful change in scope, cost, or timeline. What did change is how much surveyors must document, how encroachments and access conditions get reported, and who is responsible for gathering which documents.

If you’re a buyer, lender, developer, or attorney working on commercial real estate deals, these updates affect you. Some of the changes are subtle. A few are not.

Why the 2026 ALTA/NSPS Standards Were Updated

The Five-Year Review Cycle

ALTA/NSPS standards get reviewed every five years. A joint committee of ALTA and NSPS members meets, looks at how the current version is working in practice, and makes changes where the language is unclear or the responsibilities are misaligned.

This cycle has produced updated editions in 1999, 2005, 2011, 2016, 2021, and now 2026.

What Needed Fixing

The 2021 standards worked. But after five years of real transactions, a few problems kept coming up.

Some language was vague enough that surveyors and title professionals interpreted it differently. Responsibility for gathering certain documents wasn’t clearly assigned. And encroachment findings were being communicated inconsistently. One surveyor would flag an issue prominently. Another would tuck it into the drawing with no explanation.

The 2026 revision focused on three things:

1. Cleaner language that leaves less room for interpretation
2. Clearly defined responsibilities between surveyors, title companies, and clients
3. Consistent reporting on encroachments and access conditions

New Documentation and Reporting Requirements Surveyors Must Follow

Surveyors Now Carry More of the Research Load

Under the 2021 standards, clients or title insurers were expected to provide deeds for adjoining properties. That’s no longer the case. Surveyors must now obtain those records on their own, typically through desktop research at local registries.

The title commitment requirement is also now stated directly, not implied. The surveyor must receive a copy of the most recent title commitment, or equivalent title evidence, before completing the survey. This matters because surveys completed without full title information have caused problems at closing. The 2026 standards close that gap.

Discrepancies Must Be Explained on the Survey

When field conditions don’t match what’s in the record, the surveyor must explain why, in writing, on the face of the survey. That applies to:

• Differences between recorded and measured distances
• Reasons a new legal description was prepared
• Limitations on access to the property
• Statements made by landowners or occupants about title or boundary issues
• Any observations that could change how the survey is interpreted

That last item deserves attention. If a property owner says something during fieldwork that touches on a boundary or access question, it now has to go in the survey. That information reaches the title insurer and the buyer. It doesn’t disappear after the field visit.

Easements Need a Full Accounting

Every easement listed in the title commitment must be addressed on the survey. The surveyor must state whether each one is:

• Shown on the survey
• Unable to be located in the field
• A blanket easement with no specific location
• Illegible in the recorded document
• Not applicable to the subject property

If the surveyor finds a recorded easement that isn’t in the title materials, they must notify the title insurer. The insurer decides whether it’s still active and whether it needs to be plotted. The 2026 standards also clarify that easements can end through legal mechanisms other than a recorded release. That’s how title chains work in practice, and the standards now reflect it.

Certifications Can Follow the Loan

Survey certifications can now be extended to a lender’s successors and assigns, when that language is requested. For lenders who sell loans on the secondary market, this removes the need to get corrected certifications after a transfer. It’s a small fix that saves real time.

How Encroachments and Access Issues Are Addressed Under the 2026 Standards

The Old Approach Had a Real Problem

Under previous standards, encroachments lived inside the survey drawing. Finding them meant reading the entire document. On a complex commercial property, that review was slow and easy to get wrong. There was no consistent place to look for red flags.

Table A Item 20: The Encroachment Summary Table

The most significant addition in the 2026 standards is the new optional Table A Item 20. When selected, the surveyor includes a dedicated summary table on the face of the survey. It documents observed physical conditions and potential encroachments, including:

• Encroachments across boundary lines
• Encroachments into easements or rights-of-way
• Encroachments into setback areas
• Third-party use of the property without a recorded easement
• Access between adjoining parcels that depends on common ownership rather than a documented easement

Each entry references its exact location on the survey drawing. Reviewers go straight to the issue. No hunting.

What the Table Does and Doesn’t Do

The table documents physical conditions. It does not express legal opinions or make any determination about ownership. That’s the job of title counsel.

Worth noting: many experienced surveyors had already been including a version of this summary before the 2026 standards took effect. The new requirements formalize the practice and make it consistent across firms.

Changes to Table A Items and Optional Survey Responsibilities

Table A is where buyers, lenders, and developers expand what a survey covers beyond the minimum requirements. The 2026 standards added one new item, renumbered one existing item, and clarified several others.

Item 20 Is New. Item 21 Is the Old Write-In.

The 2021 Table A had 19 numbered items, plus a blank Item 20 for custom additions. That blank has been replaced by the encroachment summary. The write-in option still exists. It’s now Item 21.

Item 20 is already showing up as a standard requirement from most commercial lenders. For complex properties with shared access, tight setbacks, or complicated boundary histories, selecting it adds real value to the survey deliverable.

Other Table A Changes Worth Knowing

Item 11(b) – Private Utility Locates Clients can now coordinate private utility location requests directly instead of routing everything through the surveyor. Useful on properties with layered or underground utility infrastructure.

Item 15 – Remote Sensing and Aerial Methods This item covers survey methods beyond traditional ground-based fieldwork, including photogrammetric mapping, remote sensing, and airborne or mobile laser scanning. Under the 2026 version, the surveyor must confirm with the client that these methods are acceptable before using them. Clients have to agree before traditional field observation gets replaced with remote data collection.

Table A Introduction The introduction now states that some Table A items listed as optional may actually be required by state statute, administrative rule, or local ordinance. Check local requirements. Don’t assume any item is discretionary.

Negotiated Items Any Table A item that was modified or negotiated between the surveyor and client must be explained in the survey. Vague agreements about scope don’t hold up under the 2026 standards.

What Property Owners, Buyers, and Lenders Should Do Differently in 2026

The transaction process itself doesn’t change. But several habits do.

1. Use the Right Version Language From Day One

Put “2026 ALTA/NSPS LAND TITLE SURVEY” in every survey request and engagement letter. Using outdated version language in a contract signed after February 23, 2026 creates a compliance problem that can stall closing.

2. Send the Title Commitment to the Surveyor Early

ALTA surveys are built around the title commitment. When that document is late, the survey is late. Order both at the same time. Don’t wait for the title commitment to be finalized before contacting the surveyor. Under the 2026 standards, it’s a required input, not a nice-to-have.

3. Agree on Table A Before Fieldwork Starts

Review Table A with your surveyor and lender before anyone goes to the site. Gather property documents upfront. Changes after fieldwork cost more time and money. In a tight transaction timeline, a week’s delay can create real problems.

4. Select Item 20 on Every Commercial Deal

For buyers and lenders, this item should be on every commercial acquisition or financing. It puts encroachment and access issues in one readable place. That means faster due diligence and clearer identification of anything that might need a title endorsement, easement documentation, a zoning review, or a price adjustment.

5. Build the New Detail Into Your Timeline

Surveys under the 2026 standards include more explanatory notes, more explicit easement accounting, and more back-and-forth between the surveyor and the title company. That’s by design. A more documented survey means fewer surprises at closing. But it also means the survey process needs more lead time than it used to.

Coordinate early across all parties: surveyor, title company, lender, and legal counsel. The 2026 standards work best when everyone is aligned before fieldwork begins, not after problems show up.

An ALTA/NSPS land title survey is a standardized property survey required for most commercial real estate closings. It maps boundary lines, structures, easements, and encroachments. A licensed surveyor must certify it under the joint standards of the American Land Title Association (ALTA) and the National Society of Professional Surveyors (NSPS). The 2026 edition is the most recent update to rules that have shaped U.S. commercial real estate deals for decades.

What Are the 2026 ALTA/NSPS Survey Standards?

ALTA and NSPS revise the standards on a regular cycle to keep surveys accurate, consistent, and legally sound in every U.S. state. The 2026 update rewrites the surveyor’s certification in clearer legal language, tightens the definitions for Table A optional items, and draws a sharper line between what’s required and what’s optional. That last change is worth noting: less gray area means fewer disagreements after the survey is done.

What every compliant ALTA/NSPS survey must include

•  A precise legal description of the property boundaries

•  Location of all improvements, structures, and easements

•  Evidence of encroachments or rights-of-way

•  Optional Table A items selected by the client

•  A certification signed and sealed by a licensed surveyor

A basic boundary survey won’t satisfy most commercial lenders or title companies. ALTA/NSPS is the only survey standard that’s nationally recognized and enforceable across all 50 states.

Why Do Lenders and Title Companies Require an ALTA/NSPS Survey?

Lenders and title companies require ALTA/NSPS surveys because they answer four questions before closing: Where are the boundaries? What’s on the property? What restrictions apply? Who else has rights to it? No other survey format answers all four in a nationally consistent, legally enforceable way.

Each party at the closing table needs the survey for a different reason. Lenders require it as a loan condition. It confirms the property securing the loan is what the borrower says it is. Title companies use it to issue extended coverage policies and remove exceptions a basic title search can’t resolve. Buyers use it to verify exactly what they’re getting before money changes hands.

Skip the survey, or use one that doesn’t meet the standard, and a commercial closing can fall apart. Some don’t get back on track.

Who Relies on ALTA/NSPS Surveys?

Lenders, title companies, and buyers each have dedicated articles in this series covering their specific needs. Two groups that don’t get as much attention:

Real estate attorneys

Attorneys use the survey to check legal descriptions, confirm recorded easements, and catch anything that needs fixing before closing. A certified ALTA/NSPS survey is a legal document. If a boundary or easement dispute goes to court, it holds up.

Developers and architects

Before any construction starts, developers need exact property limits: setbacks, utility locations, and anything that restricts where they can build. The ALTA/NSPS survey has to come first. No design work or permits can move forward without it.

What Are the Key Components of an ALTA/NSPS Survey?

Every ALTA/NSPS survey starts with a mandatory baseline of seven elements. On top of that, clients can request from a list of 19 optional Table A items to fit the specific needs of their transaction.

Mandatory baseline elements (required in every survey)

•  Boundary lines and corners of the property

•  Location of all buildings and structures

•  Visible evidence of easements and rights-of-way

•  Identification of recorded documents affecting the property

•  Evidence of access to a public road or right-of-way

•  Observed encroachments

•  A signed and sealed surveyor’s certificate

Optional Table A items (selected by the client)

Table A has 21 optional items covering things like flood zone classifications, zoning data, parking counts, and utility infrastructure. Your attorney, lender, and title company will decide which ones apply. The 2026 update gives each Table A item a clearer definition, so there’s less room for disagreement over what was ordered versus what got delivered.

How to Prepare for an ALTA/NSPS Survey Under the 2026 Standards

Preparing for an ALTA/NSPS survey comes down to five steps: hire a surveyor who knows the 2026 standards, gather your title and deed documents before you call, confirm Table A items with your team before work starts, check whether an existing survey is still valid, and order early. Most commercial ALTA surveys take two to four weeks.

Step 1 — Hire a surveyor who knows the 2026 standards

Not every licensed surveyor does ALTA/NSPS work. Ask directly whether they know the 2026 update. Commercial surveying takes specific experience. The wrong hire means rework, which means closing delays.

Step 2 — Pull your documents together before you call

Hand your surveyor the current title commitment, deed, and any recorded plats or easement documents. The more complete your package, the faster the survey gets done.

Step 3 — Decide on Table A items before work begins

Get your attorney, lender, and title company to agree on which Table A items are needed before the surveyor starts. Adding items after the work is underway costs more and slows everything down.

Step 4 — Check whether your existing survey is still valid

A survey done under the 2016 or 2021 standards may not pass under 2026 rules. Confirm with your title company before assuming it qualifies. An updated survey is a known cost. A failed closing is not.

Step 5 — Build survey time into your schedule

Most commercial ALTA surveys take two to four weeks. Large or complex sites take longer. Cost typically runs $2,000 to $8,000 or more, depending on acreage and complexity. Ordering early is the easiest way to keep a closing on track.

Frequently Asked Questions About ALTA/NSPS Surveys

How long does an ALTA/NSPS survey take?

Most commercial ALTA/NSPS surveys take two to four weeks. Multi-parcel sites or properties with complex easement networks can take longer. Order as early as possible in the transaction timeline.

What is the difference between a boundary survey and an ALTA/NSPS survey?

A boundary survey marks property lines. It doesn’t cover easements, encroachments, improvements, or the other details lenders and title companies require. An ALTA/NSPS survey covers all of it in a nationally standardized format. For a full comparison, see our dedicated article on what ALTA reveals that standard surveys miss.

Does my existing survey still meet the 2026 standards?

A survey done under the 2021 or earlier standards may not satisfy your lender or title company under 2026 rules. Confirm with your title company before assuming it qualifies.

Who pays for the ALTA/NSPS survey?

In most commercial deals, the buyer pays. That said, it’s negotiable and varies by market. Lenders may require it as a loan condition regardless of who funds it.

An ALTA survey provides a detailed look into a property’s physical and legal reality. When it uncovers an encroachment, buyers, sellers, lenders, and title companies must pause. What happens next determines whether a transaction closes, pauses, or falls apart. 

Understanding Encroachments

An encroachment happens when a structure or improvement crosses a property line without legal authorization.

These issues are rarely visible during a standard title search. An ALTA survey catches them by combining physical boundary measurements with title record analysis.

Transactions face two distinct scenarios:

• Encroachments onto the property: A neighbor’s structure crosses into the land you are buying.
• Encroachments by the property: A structure on the land you are buying extends onto a neighbor’s parcel.

Both scenarios introduce legal risk, require disclosure to lenders and title companies, and demand a resolution before a commercial deal can move forward.

Typical Finds on a Survey Map

• Fences and walls: Older fences frequently straddle true property lines rather than sitting exactly on them.
• Building overhangs: Roof eaves and cornices can project past legal boundaries, especially on older downtown structures.
• Paved surfaces: Driveways and commercial parking lots often creep onto adjacent lots during past expansions.
• Equipment and utilities: HVAC units, generators, and retaining walls are occasionally installed without a prior boundary check.

Why Encroachments Disrupt Due Diligence

A boundary discrepancy is a financial risk that alters the value and marketability of real estate.

Lender Risk

Commercial lenders require ALTA surveys to protect their collateral. If a building they fund sits partially on a neighbor’s land, their security interest is compromised. A hostile neighbor could demand the removal of that structure, lowering the property’s value.

Title Insurance Limitations

Standard title insurance policies exclude matters that a correct survey would reveal. Once an ALTA survey flags an encroachment, the title company lists it as a specific exception. The insurer will not cover losses tied to that issue unless you resolve it or obtain a specific endorsement.

Future Sales

Unresolved issues stay with the land. The next buyer, lender, and title underwriter will encounter the exact same problem. Fixing it now protects long-term resale value.

Can the Transaction Close?

Yes. Many deals close despite survey issues, depending on severity and how the parties respond.

Minor issues—like a fence off by two inches—are often handled with a title policy endorsement. The insurer covers the risk, sometimes for an extra fee, provided the neighbor signs a basic acknowledgment.

Major issues involving permanent buildings require actual structural or legal fixes before a lender releases funds. If a neighbor already disputes the boundary, you must renegotiate the price, extend due diligence, or walk away.

How Title Underwriters Handle the Risk

Once a surveyor notes an intrusion, the title underwriting team reviews the legal risk to decide if the policy can move forward.

The initial title commitment lists the issue as an exception, removing coverage for any claims related to that specific boundary problem. From there, underwriters generally choose one of three paths:

Methods for Resolution

Fixes range from simple paperwork to structural modifications.

Boundary Line Agreements

Both owners sign a written agreement adjusting the line to match physical reality. Recording this document in public land records provides a clean solution for minor mismatches.

Lot Line Adjustments

A formal process that permanently relocates the legal boundary. It requires municipal approval, a new survey, and updated legal descriptions. It takes time but fixes the title cleanly.

Easements

The neighbor grants a recorded easement allowing the structure to remain. Ownership stays the same, but the property gains the legal right to keep the structure there. Title companies routinely insure over issues once a valid easement is recorded.

Physical Removal

Sometimes the simplest solution is moving the obstacle. Tearing down an old fence or moving a utility pad resolves the issue instantly, though this is rarely feasible for primary buildings.

Real-World Scenarios

• The Misplaced Fence: An ALTA survey showed a retail center’s rear fence sat three feet inside the neighboring lot. The seller recorded a boundary agreement with the neighbor. Closing shifted by three weeks, but the deal survived intact.
• The Encroaching Warehouse: A warehouse loading dock extended onto an adjacent industrial parcel. Because the seller owned both lots, they completed a lot line relocation before closing, satisfying the lender’s requirements.
• The Airspace Easement: A historic downtown building’s roof cornice extended 14 inches over the property line. Since removal was impossible, the seller secured an airspace easement from the neighbor, allowing the title company to issue an endorsement.
• The Hostile Neighbor: A buyer discovered an office park’s main driveway sat eight feet inside the neighboring parcel without an easement. The neighbor refused to negotiate or grant access. Lacking legal entry, the buyer canceled the contract.

Common Questions

Who pays to fix the issue?

This is a matter for contract negotiation. Sellers generally must deliver clean title, making resolution their responsibility before closing. Buyers occasionally accept the risk themselves in exchange for a price reduction.

How long do these resolutions take?

An acknowledgment letter or simple agreement takes days. Structural removals, formal lot line adjustments, or disputes with difficult neighbors can drag on for months.

Is an encroachment identical to an easement?

No. An easement is a legal right to use someone else’s land. An encroachment is an unauthorized physical intrusion. You often resolve an encroachment by turning it into an easement.

 In the complex world of commercial real estate, due diligence is a vital step that thoroughly evaluates all aspects of a property before finalizing a transaction. Among the many elements of due diligence, land surveys play a crucial role, particularly when it comes to understanding easements and identifying exceptions in the title commitment. This article delves into the intricacies of these processes, offering a comprehensive guide for commercial real estate professionals. 

The Importance of Due Diligence in Commercial Real Estate

Due diligence in commercial real estate involves a thorough investigation of the property to confirm all facts and uncover any potential issues. This process is essential for buyers to make informed decisions and for sellers to provide transparency. One of the key components of due diligence is the land survey, which provides detailed information about the property’s boundaries, structures, and any encumbrances or benefits associated with it. 

Understanding Land Surveys in Commercial Real Estate

A land survey is a precise measurement and mapping of a property’s dimensions, boundaries, and features. In commercial real estate, surveys are vital. They ensure the property being purchased accurately represents itself and is free from unforeseen issues that could impede its use or reduce its value. 

Types of Land Surveys 

• Boundary Survey: Establishes the exact boundaries of a property. 
• ALTA/NSPS Survey: A comprehensive survey that includes boundary lines, easements, encroachments, and other significant property details, meeting the standards set by the American Land Title Association and the National Society of Professional Surveyors. 
• Topographic Survey: Maps the terrain and features of a property, such as buildings, trees, and waterways. 

Easements: Encumbering and Benefiting Properties 

Easements are legal rights to use another person’s land for a specific purpose. In commercial real estate, understanding easements is crucial as they can either benefit or encumber a property. 

Encumbering Easements

Encumbering easements restrict the use of a property. Common examples include: 

• Utility Easements: Allow utility companies to install and maintain infrastructure such as power lines, water pipes, and sewers. 
• Right-of-Way Easements: Grant others the right to travel across a property, often for access roads or pathways. 

Benefiting Easements

 Benefiting easements provide advantages to a property, such as: 

• Access Easements: Allow property owners to access their land via another person’s property, often used for landlocked parcels. 
• Utility Easements: May benefit a property by providing essential services like water, electricity, and sewage. 

How Easements are Shown by Land Surveys

Land surveys depict easements through various symbols and notations on the survey plat. The surveyor will identify and document: 

• Location and Dimensions: The exact placement and size of the easement area. 
• Purpose: The specific use allowed by the easement. 
• Benefiting and Burdened Properties: The properties that benefit from or are encumbered by the easement. 

Identifying Easements During Due Diligence

 During due diligence, reviewing the land survey for easements is critical. This process involves: 

• Examining the Survey Plat: Carefully analyzing the survey to identify all marked easements.
•  Reviewing Legal Descriptions: Cross-referencing the easements with their legal descriptions to understand their implications fully.
•  Consulting with Experts: Engaging with surveyors, attorneys, and title companies to clarify any uncertainties regarding easements. 

Title Commitment and Exceptions

 A title commitment is a document issued by a title insurance company that outlines the terms under which it will insure the title to a property. It includes a schedule of exceptions, which lists issues that the title insurance policy will not cover. Identifying these exceptions is a critical part of due diligence. 

Understanding Title Commitments

 Title commitments typically consist of three parts: 

• Schedule A: Provides basic information about the property, such as the legal description and current owner. 
• Schedule B-I: Lists requirements that must be satisfied before the title insurance policy is issued. 
• Schedule B-II: Enumerates exceptions to the coverage, which often include easements, liens, and other encumbrances. 

Identifying Exceptions on the Title Commitment

 To identify and address exceptions, follow these steps: 

• Review Schedule B-II: Carefully read through the exceptions listed in Schedule B-II of the title commitment. 
• Compare with Land Survey: Cross-reference the exceptions with the land survey to see how they impact the property. 
• Seek Clarification: Consult with the title company and legal advisors to understand the nature of each exception and its potential implications. 
• Address Issues: Negotiate with the seller to resolve any problematic exceptions, such as removing undisclosed liens or obtaining necessary easements. 

The Process of Addressing Title Exceptions 

 Addressing title exceptions involves: 

• Negotiation: Working with the seller to clear or resolve any exceptions that could affect the property’s value or usability.
•  Legal Actions: In some cases, legal action may be required to remove encumbrances or clarify ambiguous easements. 
• Amendments to the Title Commitment: Once issues are resolved, the title company may issue amendments to the title commitment, reflecting the updated status of exceptions

Conclusion

 Navigating the due diligence process in commercial real estate, especially regarding land surveys and easements, requires meticulous attention to detail and a thorough understanding of legal and technical aspects. By comprehensively reviewing land surveys and title commitments, commercial real estate professionals can identify and address potential issues, ensuring a smooth and successful transaction. 

 FAQs

 What is a land survey in commercial real estate? 

A land survey in commercial real estate is a detailed measurement and mapping of a property’s boundaries, structures, and features, crucial for confirming property details and uncovering potential issues. 

 What are encumbering easements? 

Encumbering easements are legal rights that restrict the use of a property, such as utility easements or right-of-way easements.  

How are easements shown on land surveys? 

Easements are depicted on land surveys through symbols and notations that indicate their location, dimensions, purpose, and the properties they benefit or burden. 

 What is a title commitment? 

A title commitment is a document issued by a title insurance company that outlines the terms for insuring a property’s title, including schedules of requirements and exceptions. 

 How do you address exceptions found in a title commitment? 

Addressing exceptions involves reviewing the title commitment, comparing it with the land survey, seeking clarification from experts, and negotiating with the seller to resolve issues. 

 Why is due diligence important in commercial real estate? 

Due diligence is essential in commercial real estate to verify all property details, uncover potential issues, and ensure informed decision-making before finalizing a transaction. 

1. Use existing mapping Data that is currently available. 
2. Get new mapping data from new drone photography capture missions.
3. Get new mapping data from new drone LiDAR capture missions.

Existing Topographic Mapping

The best option for existing topographic mapping, if it’s available, is existing LiDAR data from the USGS or other local entity. This data is available in most areas of the United States. The data is in point cloud format (LAS files) which can be converted to contour maps. The quality (QL-2) is stated as being able to provide 2-foot contour interval maps, which can be interpolated to 1-foot contours.

This is a perfect solution for being able to do master land planning or lot layouts for a proposed use on your property. There will need to be additional field survey work to add more precise elevations in the areas like for new sanitary sewer lines and street roadway design.

When we use this existing available mapping, we always include taking check shots on the ground in various areas in order to field check the LiDAR data. Overall, this method is a very reasonable solution at a fairly economical price.

It should be noted that there are SOME areas in the US that don’t meet this QL-2 quality level. The whole US is mapped with the NED 10 (10 meter spacing) which will only produce a 1-3 meters (3-10 feet) contour map, at best.

Collecting New Photographic Image Data

This option involves flying over the property, likely with a drone, that has a high precision camera for collecting overlapping images. 

In areas that do not have a lot of trees, photographic images are the best solution. These photographs can be processed to create a couple of different mapping options. The first is an orthometric photo (also called an orthophoto) which takes out the distortion from the photographs and gives you a flat map-like image of the property. 

The contours are created from a process called photogrammetry. Ground shots spacing with this method is in the range of a 10-30 feet grid. This involves setting ground control points that are used in the photographic processing phase. These ground control points are set by the surveyor.

This photogrammetry process will produce a very good 1-foot contour mapping file. Contours are accurate to plus or minus half the contour interval. Spot elevation shots are accurate to within a quarter of the contour interval. Again, this isn’t the best option to use for vegetated areas.

Collecting New LiDAR Sensor Data for Topographic Mapping

For wooded property, the LiDAR sensor is needed. This allows us to get points from the ground beneath the tree canopies. LiDAR ground shot spacing is in the 1-foot grid range. Obviously this cost some more because of the added expense of the different sensor. The price has been coming down over the last few years though. Of course if you need precise elevations, this is the best option. 

As an engineer, I would still say that a surveyor should take some field measurements where a sanitary sewer main is to be located before doing the design. And to ensure that the roadway design is precise, and that the earthwork grading calculations are accurate, the roads should be also surveyed conventionally.

It should be noted that even with LiDAR sensors, the ground surface in the wooded areas are not as precise as the ground surface in cleared areas. But because of the very small grid spacing again these surface models are very precise.

Accuracy Terms

NED – National Elevation Dataset – refers to NED 3 (highest resolution of approx 1-3 meters), NED 10 (10 m), NED 30 (30 m), and NED 60 (60 m). These datasets use the GeoTIFF format and the UTM or NAD 83 spatial reference. See the National Map for more information and availability. The NED is managed by the USGS.

3DEP – 3D Elevation Program – A term that includes private and public partners that fund the acquisition of elevation data. This is also managed by the USGS.

Topographic Data Quality Levels – 3DEP LiDAR Base Specifications

AI Prompt: How does the accuracy of NED 10 compare to LiDAR Quality Level 2 (QL2) data?

LiDAR Quality Level 2 (QL2) data typically has a significantly higher vertical accuracy compared to the NED 10-meter dataset. Here are some key comparisons:

1. Vertical Accuracy:
   • NED 10-Meter Dataset: Generally ranges from 1 to 3 meters.
   • LiDAR QL2 Data: Vertical accuracy is typically around 10 centimeters (0.1 meters) or better.
2. Resolution:
   • NED 10-Meter Dataset: Has a spatial resolution of 10 meters, meaning the elevation data points are spaced 10 meters apart.
   • LiDAR QL2 Data: Has a much finer spatial resolution, often with point spacings of around 0.7 to 1 meter or even finer, depending on the specific survey.
3. Data Source:
   • NED 10-Meter Dataset: Derived from various sources including photogrammetry, existing topographic maps, and some LiDAR data.
   • LiDAR QL2 Data: Specifically acquired using LiDAR technology, which provides high-density point clouds and highly detailed surface models.
4. Applications:
   • NED 10-Meter Dataset: Suitable for regional-scale studies and applications where very high precision is not critical.
   • LiDAR QL2 Data: Ideal for detailed topographic mapping, flood modeling, vegetation analysis, infrastructure planning, and other applications requiring high precision and detail.

In summary, LiDAR QL2 data provides a much higher level of vertical accuracy and resolution compared to the NED 10-meter dataset, making it preferable for applications requiring detailed and precise elevation information.

Are you purchasing a new property? Or perhaps you are planning to construct a building on a plot of land? In either case, it is crucial to understand the importance of land title surveys. These surveys are an essential part of any real estate transaction, providing crucial information about the property boundaries and ownership rights.

In this article, we will delve into everything you need to know about land title surveys. We will explore why these surveys are necessary, what they entail, and how they can protect your interests as a buyer or property owner. Whether you are a first-time buyer or an experienced investor, understanding the ins and outs of land title surveys will give you peace of mind and help ensure a smooth and secure transaction.

Join us as we uncover the importance of land title surveys and how they play a vital role in the real estate industry. By the end of this article, you will have a comprehensive understanding of why these surveys are vital for every property buyer and owner.

What is a land title survey?

A land title survey, also known as a boundary survey, is a detailed examination and mapping of a property’s boundaries. It is conducted by a professional land surveyor who specializes in determining property lines and accurately identifying the dimensions and features of a piece of land.

The purpose of a land title survey is to establish the legal boundaries of a property and determine any encroachments or discrepancies that may exist. This survey provides an accurate depiction of the property’s size, shape, and location, which is crucial for various reasons, including property ownership, development, and construction.

Land title surveys typically involve research into historical documents, such as deeds and plats, to gather information about the property’s boundaries. The surveyor then physically measures the property using advanced equipment, such as GPS technology and total stations, to map out the boundaries and identify any potential issues.

A land title survey is a comprehensive process that requires expertise and precision, ensuring that the property lines are accurately depicted on the survey map. It is an essential step in any real estate transaction, as it provides a clear understanding of the property’s boundaries and ownership rights.

The role of land title surveys in real estate transactions

Land title surveys play a crucial role in real estate transactions, providing vital information to both buyers and sellers. For buyers, a land title survey helps ensure that the property they are purchasing aligns with their expectations and any representations made by the seller.

By conducting a land title survey, buyers can verify the property’s boundaries and confirm that there are no encroachments or boundary disputes that could affect their use and enjoyment of the land. This survey also provides valuable insights into the property’s topography, easements, and other physical features that may impact future development plans.

For sellers, a land title survey can help avoid potential legal issues and disputes. By having a professional survey conducted before listing the property, sellers can identify and address any boundary discrepancies or encroachments, ensuring a smooth and transparent transaction.

Additionally, a land title survey can be beneficial for lenders who require an accurate representation of the property’s boundaries and value before approving a loan. This survey provides valuable information that lenders can use to assess the property’s marketability and determine the loan amount.

In summary, land title surveys are essential in real estate transactions as they provide clarity and transparency regarding property boundaries, helping buyers, sellers, and lenders make informed decisions.

The importance of accurate land boundaries

Accurate land boundaries are of utmost importance in any property transaction. They define the legal limits of a property and help establish the rights and responsibilities of the owner. Without accurate boundaries, disputes can arise, leading to costly legal battles and potential loss of property rights.

Land title surveys ensure that the property boundaries are accurately depicted on the survey map, providing a clear understanding of the property’s limits. This information is crucial for property owners, as it helps them determine what they legally own and where their rights end.

Accurate land boundaries also help prevent encroachments, which occur when a structure or improvement, such as a fence or building, extends beyond the property’s boundaries and onto a neighboring property. Encroachments can lead to conflicts with neighbors and potential legal actions, which can be avoided by conducting a land title survey.

Moreover, accurate land boundaries can impact property values. Buyers are often willing to pay a premium for properties with well-defined boundaries, as it provides certainty and security regarding the property’s size and ownership. On the other hand, properties with ambiguous or disputed boundaries may face challenges in the market and may be subject to price negotiations or even potential buyers backing out of the transaction.

In summary, accurate land boundaries are essential for property owners as they define ownership rights, prevent conflicts with neighbors, and can impact property values. A land title survey is the key to ensuring accurate boundaries and protecting your interests as a property owner.

Common issues discovered through land title surveys

Land title surveys can uncover a variety of issues that may not be immediately evident to the naked eye. These issues can have significant implications for property owners and potential buyers. Let’s explore some of the common issues that can be discovered through land title surveys.

1. Boundary Disputes: Land title surveys can reveal boundary discrepancies or encroachments, which can lead to disputes between neighboring property owners. These disputes may require legal intervention to resolve and can be costly and time-consuming.
2. Easements: An easement is a legal right to use a portion of another person’s property for a specific purpose. Land title surveys can identify existing easements, such as utility lines or rights of way, which may limit the property owner’s full use and control of the land.
3. Zoning Restrictions: Land title surveys can help determine if a property is subject to any zoning restrictions or regulations. Zoning restrictions can affect how the property can be used and developed, which is crucial information for potential buyers or investors.
4.  Encroachments: As mentioned earlier, land title surveys can identify encroachments, which occur when a structure or improvement extends beyond the property boundaries. Encroachments can lead to legal disputes and potential loss of property rights.
5. Flood Zones: Land title surveys can identify if a property is located within a designated flood zone. This information is crucial for property owners and buyers, as it may affect insurance requirements and potential risks associated with flooding.

These are just a few examples of the issues that land title surveys can uncover. By conducting a thorough survey, property owners and buyers can address these issues proactively and make informed decisions regarding the property.

The process of conducting a land title survey

The process of conducting a land title survey involves several steps to ensure accuracy and completeness. Let’s take a closer look at the typical steps involved in a land title survey.

1. Research: The surveyor begins by researching historical documents, such as deeds, plats, and previous surveys, to gather information about the property’s boundaries and any potential encumbrances or easements. This research helps establish the starting point for the survey.
2. Fieldwork: Once the necessary research is complete, the surveyor visits the property to physically measure and map out the boundaries. Advanced equipment, such as GPS technology and total stations, is used to accurately measure distances and angles.
3.   Boundary Markers: As part of the fieldwork, the surveyor may place boundary markers at key points along the property lines. These markers serve as a visual representation of the boundaries and can help prevent future disputes or encroachments.
4.  Data Analysis: After the fieldwork is complete, the surveyor analyzes the collected data to create an accurate survey map. This map includes detailed information about the property’s boundaries, dimensions, and any relevant features or encumbrances.
5. Report Preparation: The surveyor prepares a comprehensive report that summarizes the findings of the land title survey. This report typically includes the survey map, a legal description of the property, and any relevant notes or observations made during the survey.
6. Delivery and Review: The final step is the delivery of the survey report to the client, whether it be a buyer, seller, or lender. The client reviews the report to ensure that it aligns with their expectations and any representations made during the transaction.

It is important to note that the process may vary slightly depending on the specific requirements of the survey and the jurisdiction in which it is conducted. However, the overall objective remains the same: to provide an accurate depiction of the property’s boundaries and relevant information for the parties involved.

How land title surveys protect property owners

Land title surveys provide crucial protection for property owners by offering a clear understanding of their property boundaries and ownership rights. Let’s explore some of the ways in which land title surveys protect property owners.

1. Boundary Clarity: Land title surveys establish the legal boundaries of a property, providing property owners with a clear understanding of what they own. This clarity helps prevent encroachments and boundary disputes, protecting the property owner’s rights and ensuring peaceful enjoyment of the land.
2. Encroachment Identification: Land title surveys can identify any encroachments or boundary discrepancies that may exist. By uncovering these issues, property owners can take appropriate action to rectify the situation, such as negotiating with neighboring property owners or seeking legal remedies.
3. Legal Compliance: Land title surveys ensure that the property is in compliance with applicable zoning regulations and restrictions. This compliance is crucial for property owners, as it helps prevent potential fines, penalties, or legal actions resulting from non-compliance.
4. Property Value: Accurate land boundaries, as determined by land title surveys, can positively impact property values. Buyers are often willing to pay a premium for properties with well-defined boundaries, as it provides certainty and security regarding the property’s size and ownership.
5.  Development Planning: Land title surveys provide valuable information for property owners who plan to develop or build on their land. The survey maps and accompanying reports help property owners understand the property’s topography, easements, and other physical features that may impact their development plans.

In summary, land title surveys protect property owners by establishing clear boundaries, identifying encroachments, ensuring legal compliance, impacting property values, and aiding in development planning. These surveys provide valuable information that helps property owners make informed decisions and protect their interests.

The impact of land title surveys on property values

Land title surveys can have a significant impact on property values. Accurate land boundaries, as determined by these surveys, play a crucial role in determining the value of a property. Let’s explore the various ways in which land title surveys can impact property values.

1. Certainty and Security: Properties with accurate land boundaries provide certainty and security for buyers, which can increase the perceived value of the property. Buyers are more willing to pay a premium for properties that have well-defined boundaries, as it eliminates any ambiguity or potential disputes regarding ownership.
2.  Avoidance of Legal Issues: By conducting a land title survey, property owners can identify and address any boundary discrepancies or encroachments before listing the property. This proactive approach helps avoid potential legal issues and disputes that may arise during the transaction, thereby preserving the property’s value.
3. Marketability: Properties with accurate land boundaries are generally more marketable than those with unclear or disputed boundaries. Buyers are often attracted to properties that have well-defined boundaries, as it provides peace of mind and confidence in their investment.
4.  Development Potential: Land title surveys provide valuable information for property owners who plan to develop or build on their land. The survey maps and accompanying reports help property owners understand the property’s topography, easements, and other physical features that may impact their development plans. This knowledge can significantly impact the property’s value, as it allows for informed decision-making regarding development potential.
5.  Lender Confidence: Lenders often require accurate land boundaries and values before approving a loan. A land title survey provides the necessary information for lenders to assess the property’s marketability and determine the loan amount. This confidence from lenders can positively impact property values and facilitate smoother transactions.

In summary, land title surveys can have a positive impact on property values by providing certainty, avoiding legal issues, increasing marketability, unlocking development potential, and instilling confidence in lenders. These surveys are an essential tool for property owners and buyers alike, ensuring accurate valuations and protecting investment interests.

Hiring a professional land surveyor for your land title survey

When it comes to land title surveys, it is crucial to hire a professional land surveyor with the necessary expertise and credentials. A professional surveyor will ensure that the survey is conducted accurately and in accordance with industry standards and legal requirements.

Here are some important factors to consider when hiring a professional land surveyor for your land title survey:

1. Experience and Expertise: Look for a surveyor with extensive experience in conducting land title surveys. Their expertise and knowledge will ensure that the survey is conducted accurately and efficiently.
2. Licensing and Certification: Check if the surveyor is licensed and certified by the appropriate regulatory body in your jurisdiction. This ensures that they have met the necessary qualifications and adhere to professional standards.
3. Reputation and References: Research the surveyor’s reputation in the industry and ask for references from previous clients. This will give you insights into their professionalism, reliability, and the quality of their work.
4. Insurance Coverage: Ensure that the surveyor carries professional liability insurance to protect both parties in case of errors or omissions during the survey process.
5.  Cost and Timeline: Obtain quotes from multiple surveyors and compare their costs and timelines. However, keep in mind that the lowest price may not always guarantee the best quality. It is important to strike a balance between cost and quality when selecting a surveyor.

By hiring a professional land surveyor, you can have confidence in the accuracy and reliability of your land title survey. Their expertise and attention to detail will help ensure a smooth and secure real estate transaction.

Conclusion: The significance of land title surveys in property ownership and development

In conclusion, land title surveys are crucial for property buyers and owners as they provide accurate information about property boundaries and ownership rights. These surveys play a vital role in real estate transactions, ensuring transparency, preventing disputes, and protecting property values.

Accurate land boundaries are of utmost importance as they define ownership rights, prevent conflicts with neighbors, and impact property values. Land title surveys uncover common issues such as boundary disputes, easements, zoning restrictions, encroachments, and flood zones, allowing property owners to address these issues proactively.

Keith Maxwell Is a licensed surveyor in multiple states and has completed numerous title surveys for both residential and commercial properties.

Introducing the ALTA Title Commitment for Title Insurance, a game-changer for home buyers and lenders alike. In this article, we dive deep into the benefits and intricacies of this essential safeguard in the real estate realm. With a focus on transparency and protection, the ALTA Commitment delivers peace of mind and reassurance throughout the transaction process.

No longer will buyers have to worry about hidden liens or ownership disputes haunting their property dreams. Thanks to the comprehensive coverage provided by ALTA Commitment for Title Insurance. Lenders can rest easy knowing that their investment is protected against unforeseen claims or defects in the title.

We explore the advantages of the ALTA Commitment, including coverage for restrictions, encroachments, and easements. This commitment ensures that buyers and lenders can proceed with confidence. Discover why it has become an invaluable asset in the real estate industry. Whether you’re a first-time buyer or a seasoned investor, this article is a must-read to fully understand and unlock the benefits of this essential protection.

What is the ALTA Commitment?

When it comes to purchasing a property, having a clear and marketable title is crucial. The ALTA Commitment for Title Insurance is a document that outlines the terms and conditions of the title insurance policy. It is issued by a title company after conducting a thorough title search and examination.

The Alta Commitment provides a detailed summary of the property’s ownership history, any existing liens or encumbrances, and any exceptions or exclusions to coverage. This commitment serves as a guarantee that the title is free from defects, except for those specifically listed. It offers protection to both the buyer and the lender in case any issues arise after the transaction is complete.

The Alta Commitment is a vital component in the real estate transaction process, ensuring that buyers and lenders have a clear understanding of the property’s title condition and the coverage provided by the title insurance policy. It offers peace of mind by mitigating the risks associated with potential title defects.

Benefits of the ALTA Commitment

The ALTA Title Commitment (American Land Title Association) plays a crucial role in commercial real estate transactions. Let’s explore its benefits:

1.      Title Verification: The ALTA Title Commitment provides a detailed report on the property’s title history. It verifies ownership, liens, encumbrances, and any other claims against the property. This ensures that the buyer receives a clear and marketable title.

2.      Risk Mitigation: By identifying potential title issues early in the process, the commitment allows parties to address them before closing. This reduces the risk of legal disputes and unexpected surprises after the transaction.

3.      Legal Protection: The commitment serves as a legal document that outlines the conditions under which the title insurance policy will be issued. It provides protection to both the buyer and the lender.

4.      Cost-Efficiency: Obtaining the ALTA Title Commitment is cost-effective compared to purchasing title insurance without it. It streamlines the underwriting process and minimizes redundant searches.

5.      Confidence for Lenders: Lenders rely on the commitment to assess the property’s title quality. A clear title ensures that the lender’s investment is secure.

6.      Disclosure of Exceptions: The commitment lists any exceptions or defects found during the title search. Buyers can review these and decide whether to proceed with the sale.

In summary, the ALTA Title Commitment enhances transparency, reduces risks, and provides peace of mind during commercial real estate transactions.

Understanding the components of the ALTA Commitment

To grasp the benefits and implications of the Alta Commitment, it’s essential to understand its various components. Let’s take a closer look at each component and its significance in the title insurance process. An ALTA Title Commitment typically consists of three main components:

1.      Schedule A: This section provides essential details about the transaction, including the proposed policy amount of insurance, the name of the proposed insured, and the effective commitment date.

2.      Schedule B-I (Requirements): Here, you’ll find a list of conditions that must be met before the title insurance policy can be issued. These requirements ensure that the title is clear and insurable. For example, it may include items like paying off existing liens, resolving outstanding judgments, or correcting legal descriptions.

3.      Schedule B-II (Exceptions and Exclusions): This part outlines any exceptions to coverage. It specifies matters that will not be covered by the title insurance policy. Common exceptions include existing easements, encroachments, or restrictive covenants. Additionally, it may highlight any discriminatory covenants that are unenforceable under applicable law.

Remember that the ALTA Title Commitment serves as an offer to issue one or more title insurance policies, and its content is based solely on contract terms. It is not an abstract of title, legal opinion, or representation of the status of title.

The importance of a thorough title search

A thorough title search is a vital step in the Alta Commitment process. It involves examining public records to verify the property’s ownership history, identify any existing liens or encumbrances, and ensure that the title is free from defects.

A comprehensive title search is crucial because it uncovers any potential issues that may affect the property’s marketability. This includes outstanding mortgages, unpaid taxes, judgments, or other claims against the property. By conducting a thorough title search, buyers and lenders can make informed decisions and understand the risks associated with the property.

The Alta Commitment relies heavily on the accuracy and completeness of the title search. It serves as the foundation for issuing the commitment and subsequently the title insurance policy. Therefore, it is essential to engage a reputable title company with experienced professionals who can conduct a thorough and meticulous title search.

How the ALTA Commitment protects buyers and lenders

The Alta Commitment plays a crucial role in protecting both buyers and lenders from potential title defects and claims. Let’s explore how this commitment offers security and peace of mind to all parties involved in a real estate transaction:

• Clear Title Assurance:
  1. The Title Commitment outlines any existing liens, encumbrances, or defects related to the property. By addressing these issues upfront, it ensures that the title is clear and marketable.
  1. Buyers can proceed with confidence, knowing that the property they are purchasing has a clean title.
• Risk Mitigation:
  1. The commitment identifies potential risks and requirements (Schedule B-I) that must be resolved before closing. This proactive approach minimizes surprises during the transaction.
  1. Sellers can address outstanding issues, reducing the likelihood of post-closing disputes.
• Title Insurance Protection:
  1. Upon closing, the Title Commitment serves as the basis for issuing title insurance policies (such as Owner’s Title Insurance and Lender’s Title Insurance).
  1. These policies protect buyers and lenders against financial losses due to title defects, fraud, or undisclosed claims.
  1. Knowing that they have insurance coverage provides peace of mind to both buyers and lenders.
• Legal Clarity:
  1. The commitment clarifies legal descriptions, ownership rights, and any restrictions (Schedule B-II).
  1. Parties can make informed decisions based on accurate information, avoiding legal complications down the line.
• Facilitating Smooth Transactions:
  1. By addressing title-related matters early, the commitment streamlines the closing process.
  1. Real estate professionals, buyers, and sellers can focus on other aspects of the transaction, knowing that title issues are being resolved.

In summary, the Title Commitment acts as a roadmap, guiding all parties toward a successful and secure real estate transaction. It fosters transparency, reduces uncertainty, and ensures a smoother closing experience.

Common misconceptions about title insurance

Despite its importance and benefits, there are several common misconceptions surrounding title insurance. Let’s debunk some of these misconceptions to ensure a clear understanding of the role and significance of title insurance:

1. Title Insurance Is A Waste Of Money:
   1. Many buyers mistakenly believe that title insurance is unnecessary because they’ve already invested time and money in a title search. However, even the most thorough search can miss potential risks.
   1. Title insurance provides crucial protection against unforeseen issues that may arise after closing. It covers matters like fraudulent transfers, undisclosed heirs, and other hidden defects.
   1. In 2019, the industry paid out over $544 million in claims, emphasizing its importance.
2. I Don’t Need Title Insurance For A New Property Or Lot:
   1. Even for new construction homes or vacant lots, title insurance remains essential. The land may have changed hands multiple times before your purchase.
   1. Title insurance ensures that you have a clear and marketable title, regardless of the property’s history.
3. Title Insurance Offers Only Minimal Protection:
   1. Contrary to this myth, title insurance provides robust protection. It covers various risks, including undiscovered liens, encroachments, and legal defects.
   1. Without title insurance, you could face financial losses due to unforeseen title issues.
4. Paying All Cash Eliminates the Need for Title Insurance:
   1. Even if you’re paying cash for a property, title insurance is crucial. It protects your ownership rights and ensures a clear title.
   1. Cash buyers are not exempt from potential title-related problems.
5. Homeowner’s Insurance and Title Insurance Are the Same:
   1. These two types of insurance serve different purposes. Homeowner’s insurance covers property damage and liability, while title insurance focuses on title-related risks.
   1. Title insurance protects your investment in the property’s title, providing peace of mind.
6. Home Buyers Do Not Get to Choose the Title Company:
   1. Buyers often assume they have no say in selecting the title company. However, you have the right to choose the title agency that handles your transaction.
   1. Research and choose a reputable title company to ensure a smooth closing process.

Remember, title insurance safeguards your property rights and offers valuable protection, even if you never need to use it directly. It’s an essential part of any real estate transaction.

How to obtain the ALTA Commitment

Obtaining the Alta Commitment for Title Insurance is a straightforward process that involves several key steps. Let’s outline the general process of obtaining this commitment to provide a clear understanding of what to expect. Let’s walk through the general process of obtaining an ALTA Title Commitment for title insurance:

1. Opening the Order:
   1. The process begins when a real estate transaction is initiated. Typically, this occurs when a buyer enters into a purchase agreement with the seller.
   1. The title company or title agent receives the order to provide title services.
2. Title Search and Examination:
   1. The title company conducts a thorough search of public records related to the property. This search aims to identify any liens, encumbrances, or other issues that may affect the title.
   1. The title examiner reviews the search results and assesses the property’s title history.
3. Issuance of the Title Commitment:
   1. Based on the title examination, the title company prepares the ALTA Title Commitment.
   1. The commitment consists of three main sections: Schedule A, Schedule B-I (Requirements), and Schedule B-II (Exceptions and Exclusions), as discussed above.
   1. It outlines the proposed policy amount, effective date, and any requirements or exceptions.
4. Review and Resolution:
   1. The buyer, seller, and their respective attorneys review the commitment.
   1. If there are any issues or discrepancies, they work together to address them. For example, the seller may need to clear a specific lien or provide additional documentation.
5. Closing and Policy Issuance:
   1. Once all requirements are met, the closing takes place. The buyer receives the title insurance policy.
   1. The commitment serves as the basis for issuing the final title insurance policy, which protects the buyer’s ownership rights.
6. Peace of Mind:
   1. The ALTA Title Commitment offers security and peace of mind to all parties involved.
   1. Buyers can proceed confidently, knowing that potential title issues have been identified and addressed.

Remember that the title commitment is not an abstract of title or a legal opinion. It represents the title company’s offer to issue one or more title insurance policies based on the contract terms.

The role of the title company in the ALTA Commitment process

The title company plays a crucial role in the Alta Commitment process. Their expertise and attention to detail are essential in conducting a thorough title search, issuing the commitment, and providing reliable title insurance services. Let’s explore the specific roles and responsibilities of the title company in the Alta Commitment process:

1.     Title Search and Examination:

• The title company initiates a comprehensive title search by examining public records related to the property. This meticulous process involves researching deeds, mortgages, liens, judgments, and other relevant documents.
• Responsibilities:
  • Research: The title examiner meticulously reviews historical records to trace the property’s ownership history.
  • Verification: They verify the legal description, ownership rights, and any encumbrances or restrictions.
  • Identify Issues: The title company identifies potential title defects, such as outstanding liens, unresolved disputes, or undisclosed claims.

2.     ALTA Title Commitment Preparation:

• Based on the title examination, the title company prepares the ALTA Title Commitment. This commitment serves as an offer to issue title insurance policies.
• Responsibilities:
  • Schedule A: The title company outlines essential details, including the proposed policy amount, effective date, and the name of the proposed insured (usually the buyer).
  • Schedule B-I (Requirements): They list conditions that must be met before issuing the policy. These requirements ensure a clear and insurable title.
  • Schedule B-II (Exceptions and Exclusions): The title company specifies any exceptions to coverage, such as existing easements or restrictive covenants.

3.     Communication and Collaboration:

• The title company collaborates with various parties involved in the transaction:
  • Buyer and Seller: They communicate any issues found during the title search and work together to address them.
  • Lenders: The title company coordinates with lenders to ensure their interests are protected.
  • Attorneys: Legal professionals review the commitment and assist in resolving any discrepancies.

4.     Risk Assessment and Mitigation:

• The title company assesses risks associated with the property’s title. They provide valuable insights to buyers, sellers, and lenders.
• Responsibilities:
  • Risk Disclosure: The title company discloses potential risks, allowing parties to make informed decisions.
  • Resolution: If there are title defects, the title company helps resolve them before closing.

5.     Closing Process:

• During closing, the title company facilitates the transfer of ownership. They ensure all requirements are met.
• Responsibilities:
  • Document Preparation: The title company prepares necessary documents, including the deed and settlement statement.
  • Funds Handling: They handle funds, ensuring proper disbursement to sellers, lenders, and other parties.
  • Title Policy Issuance: Upon closing, the title company issues the final title insurance policy.

6.     Title Insurance Services:

• The title company provides reliable title insurance coverage:
  • Owner’s Title Insurance: Protects the buyer’s ownership rights against covered risks.
  • Lender’s Title Insurance: Safeguards the lender’s interest in the property.
• Responsibilities:
  • Underwriting: The title company underwrites the policies, assessing risks and determining coverage.
  • Claims Handling: If title issues arise later, the company handles claims and defends the insured parties.

7.     Post-Closing Support:

• Even after closing, the title company remains available for assistance. They address any post-closing concerns.
• Responsibilities:
  • Policy Maintenance: The title company ensures policy records are accurate and up-to-date.
  • Resolution of Issues: If unexpected title issues surface, they guide parties through resolution.

In summary, the title company acts as a critical intermediary, ensuring a smooth and secure real estate transaction. Their expertise, attention to detail, and commitment to transparency benefit all parties involved.

Conclusion: The value of the ALTA Commitment for property owners and lenders

The Alta Commitment for Title Insurance offers immense value to both property owners and lenders. For property owners, it provides the peace of mind and assurance that their investment is protected against any unforeseen claims or defects in the title. This protection extends beyond the closing date, offering long-term security for the property.

For lenders, the Alta Commitment acts as a safeguard for their investment. Lenders can rest easy knowing that their loan is backed by comprehensive coverage, reducing the risk of financial loss due to title defects. This protection allows lenders to confidently provide financing for real estate transactions, contributing to a more robust and secure lending environment.

In conclusion, the Alta Commitment for Title Insurance is a vital tool in the real estate industry. It offers comprehensive coverage for restrictions, encroachments, easements, and ownership disputes, ensuring that buyers and lenders can proceed with confidence. By understanding and unlocking the benefits of the Alta Commitment, both buyers and lenders can enjoy peace of mind and reassurance throughout the transaction process.

Hey, real estate professionals! Did you know that ALTA surveys are the “gold standard” when it comes to understanding a commercial property’s boundaries, improvements, and potential issues? Here’s a quick rundown of the ALTA survey essentials that every industry expert should know:

Boundary lines: ALTA surveys provide a clear-cut definition of the property’s boundaries, helping to prevent future disputes and encroachments with neighboring properties.

Easements & rights-of-way: From utility lines to shared driveways, these surveys reveal any easements or restrictions affecting your commercial property.

Improvements: ALTA surveys map out all improvements on the property, such as buildings, parking lots, and fences, giving you a complete picture of the site.

Zoning & land use: Discover the zoning classification of your property and how it impacts development possibilities.

Utilities: Stay informed about public and private utilities on or near your property, ensuring seamless access to essential services.

Flood zones: ALTA surveys help identify if your property lies within a flood zone, which can have significant implications for insurance and development.

Topography: Get detailed topographic data to make informed site planning and development decisions.

Title exceptions: Address any title exceptions listed in title commitments or preliminary title reports, such as encroachments, easements, or liens.

In short, ALTA surveys are invaluable tools for real estate professionals, buyers, sellers, and lenders alike. By providing a comprehensive and detailed analysis of a commercial property, you can make informed decisions, minimize risk, and maximize your investment’s potential.

Feel free to share your ALTA survey experiences or ask questions. Give us a call today at (800) 798-9540!