Mortgage surveys are different from other types of property surveys in that they are typically requested by lenders or insurance companies rather than homeowners. A mortgage survey is often required when you purchase a home; it’s a way for your mortgage lender to verify that the property they’re lending you money to purchase is as described in legal documents and is suitable as collateral for your mortgage loan. The lender wants to ensure that the property is worth at least as much as you’re borrowing. There are two main types of mortgage surveys; mortgage location surveys and mortgage inspection surveys.
A mortgage location survey is different from a boundary survey and is not used for construction or for boundary determinations. A mortgage location survey is usually requested by your mortgage lender or title insurance company and is intended to provide proof that certain improvements are actually located on the property as described in the legal description. These surveys identify the major buildings on your property such as the house, garage, and sheds or other structures, as well as whether your property encroaches on any neighboring properties or easements. Likewise, these surveys determine whether any neighboring properties encroach on your property.
A mortgage inspection survey is less detailed than a mortgage location survey. Mortgage inspection surveys often simply note which structures are present on the property and where they’re located. These surveys often do not include boundary lines. A mortgage inspection survey is the type of survey your mortgage lender probably ordered when you purchased your home.
Mortgage survey requirements differ from state to state and sometimes depend on the type of improvement you’re planning to make. For instance, your state may require only a mortgage inspection survey, but you may be required to obtain a more-detailed mortgage location survey to satisfy the requirements for obtaining a permit. When you’re seeking a mortgage loan or home equity loan to make such improvements to your property, you should ask your lender what type of survey is being ordered so that you know if you’ll need to order a different type of survey later before making improvements on your property. Mortgage survey costs vary based on your location; it’s best to shop around.