Buying property in New Mexico (insurance, lawyer, deed)

[Vinegaroon]

If you are going to buy property in NM, and especially if it is in rural areas up north, my advice to you is to make sure you have title insurance that covers any and all easements, disputes over property lines, etc. Make sure you pay extra if you have to so that it covers unrecorded easements and the like. The title company will usually try to list easements not of public record as an exception. Don't accept that unless you are dead sure that your chain of title, plats, surveys, etc. are in perfect order. This is going to protect you in the long run should your neighbor start claiming an easement across your property, or the local acequia claims it has ancient ditch rights across your land. They might win, but at least the title company will have to pay your legal fees, which could easily amount anywhere from $10K to $30K.

In addition, if someone says they have water rights, you need to have a water lawyer verify the rights. This might be more expensive than you wish, but if you want to make sure you have valid water rights, don't rely on the seller.

[GregW]

Excellent advice anywhere and moreso when water is involved.

[chilegal]

Great advice. And this could go for any part of the country.

[sjbasin]

Originally Posted by Vinegaroon

If you are going to buy property in NM, and especially if it is in rural areas up north, my advice to you is to make sure you have title insurance that covers any and all easements, disputes over property lines, etc. Make sure you pay extra if you have to so that it covers unrecorded easements and the like. The title company will usually try to list easements not of public record as an exception. Don't accept that unless you are dead sure that your chain of title, plats, surveys, etc. are in perfect order. This is going to protect you in the long run should your neighbor start claiming an easement across your property, or the local acequia claims it has ancient ditch rights across your land. They might win, but at least the title company will have to pay your legal fees, which could easily amount anywhere from $10K to $30K.

In addition, if someone says they have water rights, you need to have a water lawyer verify the rights. This might be more expensive than you wish, but if you want to make sure you have valid water rights, don't rely on the seller.

If there a question or a dispute or an exception you don't like, you have to resolve it before you purchase the property. Title insurance does not provide protection for the items listed above that are unrecorded. You can't simply "pay extra" to insure something unknown, it doesn't work that way.

If you want a higher level of protection in buying property, have an ALTA survey done on the property. Most people are satisfied with simple boundary surveys, or in the case of subdivided property a site improvement report. These may not reveal things that the more expensive and thorough ALTA survey will.

Disclosure: I'm a licenced Realtor, not a lawyer.

[Vinegaroon]

In most cases a title insurance company will delete the exception for easements not of public record. You might have to pay a higher premium, or it may be free. Get this done though, unless you are in the city, and then this is not much of a concern.

In addition, many sellers these days will try to pass a Special Warranty Deed off on you instead of a Warranty Deed. My advice is not to accept this. Demand a Warranty Deed, or don't buy.