This update is compliments of an area lender.
More and more title companies are adding boundary coverage (also called survey deletion) to the closing statement. This charge is assessed to your buyers. In the title work they are sending to you and your buyers after title is opened some title companies are stating in the preliminary title work it will be added unless you call and cancel it. Boundary coverage is an endorsement to the Owners Title Policy (which seller pays for but the boundary coverage is a buyer cost) which guarantees the boundary lines of the survey. This coverage costs approximately 5% of the Owners Title Policy.
If the property your buyer is purchasing is in a platted subdivision where the plat and boundary lines are recorded at the courthouse they may or may not want this coverage. If it is acreage where the legal description is field notes or metes and bounds they may want it.
I am not saying they should or should not have it – the decision is totally up to the buyers. Just note that if the preliminary title work states they will have boundary coverage they will be charged for it unless you notify the title company otherwise. Check with the individual title companies to see if they are automatically charging it and you can let your buyer make the decision. If you want it deleted it is best to have it done up front rather than getting to the table and having to stall the closing to have the HUD changed and amounts recalculated (especially during busy times)!!!
Questions? Call me at 866-276-8200 toll-free
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