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A matter of land | Survey scams? Why all those reports when purchasing or selling a property

Published:Monday | September 19, 2016 | 12:00 AM
Craig Francis

Good day readers. Last week, I responded to a question from a reader about the different surveys needed to be completed when buying or selling a house or lot?

The response left one reader annoyed and he shared an email with me which I will respond to today in an attempt to give him a clearer understanding of the necessity of the various reports.

Good day Mr Francis,

This (number of reports that one has to do when buying or selling a property) is all to frustrate people, mainly poor people. It is called scamming. This is also the reason why Jamaica has such great land problem. It's scamming by the professionals, the lending agencies and the State.



Good day, D.H.,

I am sorry that you feel that the reports required by the lending agencies are unnecessary, a means of scamming and to frustrate the buyers, sellers or just anyone trying to conduct land or property transactions.

I surmise that it's from an unpleasant experience that you have formed such negative impressions of the process.

However, D.H., the process is not one to frustrate or to scam, but one to protect all the parties involved and to ensure that everything is in order for the sale or purchase of the property.

When one is about to purchase a property, the purchaser and the institution that will be using the property as the security for a loan will need to know the actual value of the property.

This value has to be determined by a licensed valuator and will instruct the lenders as to how much they can lend to the purchaser towards acquiring the property.

If a vendor wants to sell a house for $10 million and when the valuation is done, it actually values $8 million, then the lending agency, without a valuation done, would have been exposed to a possible $2 million loss on that property.

If the borrower goes into default and the property is to be sold, the value would be less than the loan amount, and the lender loses. It's also useful for the purchaser so that he/she does not overpay for a property.




The requirement for the surveyor's report is also very critical. Persons going to purchase a car take along their mechanic to do 10-point inspection to ensure that the vehicle is in good condition before purchase.

Well, the commissioned land surveyor assesses the property through a field survey and prepares a report giving an assessment of the property.

This report speaks to the 'health' of the property. It indemnifies the lender from things such as breaches, encroachments and the wrong property altogether.

The surveyor's identification report will instruct all if there is a breach to any restrictive covenants that may run with the property.

It identifies if there is an encroachment on the property or by the property on an adjoining property. The report also verifies whether or not the property being purchased is the same as shown to the purchaser by the vendor or realtor.

I hope this explanation makes it clearer to you why these reports are necessary when purchasing or selling a property and dispel the notion that this is a scam.

Until next time, traverse well.

- Craig Francis is a commissioned land surveyor and managing director of Precision Surveying Services Ltd. He can be contacted for questions or queries at or Precision Surveying Services.