title-commitment

Title Commitment and Policy

Drafts an ALTA-standard Title Commitment identifying state of title, requirements for policy issuance, and exceptions to coverage.

Prerequisites

Collect before drafting:

• Property — legal description, APN, county, state
• Transaction — purchase price or loan amount, policy type (Owner's/Loan/Leasehold), closing date
• Vesting — current owner(s) of record with recording reference
• Title search — all encumbrances, liens, easements, CC&Rs, judgments from examination
• Parties — proposed insured(s), full legal names with entity designations
• Encumbrances — mortgages, deeds of trust, tax status, assessments to address at closing

Document Structure

Header

• Title: "COMMITMENT FOR TITLE INSURANCE"
• Issuing company: full legal name, jurisdiction-licensed
• Commitment number: [YEAR]-[OFFICE CODE]-[SEQ]
• Effective date: date through which title search was conducted

Schedule A — Transaction Details

Draft in order:

1. Policy type — ALTA Owner's (2006), Loan, or Leasehold; specify form version
2. Policy amount — purchase price (owner's) or loan amount (lender's); format $X,XXX,XXX.00
3. Proposed insured — full legal names with entity designations; specify ownership percentages if multiple
4. Current vesting — owner(s) per most recent deed with recording reference (instrument number or book/page)
5. Legal description — verbatim from deed or survey; jurisdiction-appropriate format (metes and bounds, lot/block, government survey); include plat references; separate multiple parcels

Schedule B, Part I — Requirements

List all conditions for policy issuance in closing-timeline order:

1. Premium and fees payment
2. Purchase price / loan funding confirmation via settlement statement
3. Conveyance instrument — deed executed, acknowledged, recorded
4. Existing lien releases — payoff statements + recorded satisfactions for all non-surviving mortgages, DOTs, judgment liens, tax liens
5. Owner's affidavit — possession, mechanic's liens, unrecorded interests, recent improvements
6. Entity authority — good standing, resolutions, incumbency certificates (if entity parties)
7. Survey — current ALTA/NSPS if needed to remove standard survey exception
8. Gap coverage — gap indemnity or bring-down search if effective-to-closing gap exists

Distinguish requirements due before, at, and after closing.

Schedule B, Part II — Exceptions

Open with: policy will not insure against loss from the following unless removed or modified prior to closing.

Standard exceptions (removable by endorsement — note applicable ALTA endorsement form number):

• Rights/claims of parties in possession not in public records
• Easements not shown by public records
• Encroachments, boundary issues discoverable by survey/inspection
• Mechanic's/materialmen's liens not yet of record
• Taxes/assessments not yet shown as liens

Specific exceptions — each must include full detail:

Type	Required Detail
Real property taxes	Current year status; prior year confirmation
CC&Rs	Recording reference; subdivision/HOA designation
Easements	Holder, purpose, location, recording ref; appurtenant vs. servient
Surviving mortgages/DOTs	Lender, original principal, recording ref, estimated balance
Judgments/liens	Creditor, amount, recording ref; property vs. owner's interest
Lis pendens	Case number, court, nature of action
Special assessments/CDD	Authority, purpose, amount, payment status
Mineral/subsurface rights	Scope of severance, recording reference

Pitfalls and Checks

• Every recorded-document reference needs jurisdiction-appropriate locator info (instrument number OR book/page OR official record number)
• Maintain exact consistency in party names, legal descriptions, and recording references throughout
• If assuming existing financing, except the surviving lien in Part II — do not list it as a requirement to release
• Do not draft endorsements inline; reference applicable ALTA endorsement form numbers only
• Spell out months in dates; use $X,XXX,XXX.00 for dollar amounts
• Mark any unverifiable citation or statutory reference as [VERIFY]