Estimated reading time: 2 minutes
We understand that keeping you informed is an essential part of the closing process. A title commitment is an important document that contains information specific to your transaction. So, let’s go over title commitment basics! This is an important document. We’ve outlined the basic sections of a title commitment below.
Basic 1: Schedule A- Who’s Involved and What it Costs
This section contains the “Who, What, Where and How Much” details of the transaction and is a very basic component of a title commitment. Here, Schedule A sets forth the effective date, the names of the current property owner (seller) and proposed insured (buyer), the legal description of the property, the amount of insurance (sales price), and the name of the lender and loan amount if applicable and available.
Basic 2: Schedule B-I: What Needs Done Before the Sale
Next, Section B-I is the requirements section of a title commitment. Requirements are your to-do list of a title commitment. Be sure to clear up and satisfy items in this list. They must be taken care of before a new policy is issued. Examples include: requiring the approval of a bankruptcy trustee, requiring other persons – such as an heir or former spouse – to execute closing documents, or requiring the release of various types of liens.
Basic 3: Schedule B-II: Items Not Covered
Now, on to the last section of our title commitment basics lesson. Section B-II lists the exceptions of the title commitment, and notifies the buyer and/or lender of exceptions from coverage. Some examples include restrictive covenants, mineral or water rights, or utility easements. Keep in mind, these exceptions from coverage will not be insured on the title policy.
Questions? Contact us about title commitments and other title insurance needs!
Delivering exceptional service is another essential part of the closing process. If you have any questions concerning the details of your commitment or transaction, please contact us.