6 ways to make a title commitment work for you

1. 6 Ways to Make a Title Commitment Work for You Normally, a title commitment is time- sensitive. You may have just a few days to review the document and consult with your loan officer, attorney, or realtor, if necessary.

2. Know what you’re looking for. A title commitment is categorized into five different portions. Who is being insured, the amount of insurance, what is being insured, what is required to insure the title, and what is not insured. The parties being insured may include you as the buyer and your lender. The amount of insurance should cover your mortgage loan amount and the property owner’s sales price. Separate Schedule A title commitment is broken down further into two subsections. Schedule A is what has been submitted to the title company by the escrow officer, containing the commitment date, buyer and seller information, property price, and loan amount. You’ll find the exceptions in Schedule B, including the Covenants, Conditions, and Restrictions (CC&Rs) that we’ll explain more about below. Schedule B is the part of the title commitment that you’ll really want to read.

3. Take a look at the exceptions. Yes, even with a title guarantee, there are always exceptions to the rule. Like rights of parties in possession, boundary issues, encroachments, easements not shown in public records, and more. You can cover your bases and remove some “standard exceptions” by purchasing Owner’s Extended Coverage (OEC) along with your policy. Tacher says buyers will normally see exceptions to the policy listed as easements from utility companies, as well as rights of use. Take another look at the conditions. If you’re buying a condo or a home in a subdivision, you may find their CC&Rs lumped into your title commitment by the title company. Give these conditions a thorough read and make sure they’re something you can live with. Examples of title commitment conditions include satisfying a mortgage at closing and providing an affidavit and warranty deed for a house. Your mortgage lender will fund your loan once loan approval, escrow, and title conditions are met.

4. Check the numbers This is the part where you may want to take a closer look at the fine print. Title insurance is intended to cover the home buyer and is paid for by the seller. So, most costs listed in the title commitment should be charged to the seller, with the exception of the additional American Plan Title Association (ALTA) policy that the buyer is responsible for purchasing. You can expect to pay $100 to $200 for the ALTA policy. Plus the price of any endorsements added to the title insurance.

5. Get it all in writing. Here’s the good news: If you’re happy with your title commitment, there’s nothing else for you to do. But if you have concerns or would like to request changes, these need to be presented in writing to your realtor right away to pass along to the seller. The seller will also have a specified amount of time to respond (found in your contract) before the title commitment can be finalized. As Tacher explains, this is a buyer’s chance to raise any issues that may or may not affect the clear and marketable title to the property they’re buying. Image Source:https://artesiantitle.com/ Article Source: houseloanblog.net

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