One should look at the jacket cover, which contains, among other things, the basic coverage provisions, also known as Covered Title Risks to determine what is covered in a commercial policy. The following coverages are included in both the Commercial Loan and the Commercial Owner policies:
- Title defects
- Liens or encumbrances on title
- Unmarketability of title
- Lack of a right of access
The Lender policy; however, contains additional coverage provisions including:
- The invalidity or unenforceability of a mortgage
- The priority of any lien or encumbrance over the mortgage
- The invalidity or unenforceability of any prior assignment of the mortgage
- A defect in the title or the lien of the insured mortgage caused by forgery, fraud, undue influence, duress, incompetency, incapacity, or impersonation
- A defect in the title or the lien of the insured mortgage caused by any document not properly registered in the public records
- The invalidity of any document upon which the title is based because the document was not properly executed, witnessed, sealed, notarized, delivered or registered
- Lack of priority of the lien of the insured mortgage as to each and every advance of proceeds of the loan secured by the insured mortgage over any statutory lien for services, labor, or material arising from construction of an improvement or work related to the land when the improvement or work is either:
- contracted for or commenced on or before the policy date; or
- contracted for, commenced or continued after the policy date if the construction is financed, in whole or in part, by proceeds of the loan secured by the insured mortgage that the insured has advanced or is obligated to advance on the policy date.
Schedule B sets out Stewart Title’s exceptions (i.e. what is not covered by a commercial policy) and, also contains any custom underwriting related to the transaction.
For more information about our specialized commercial endorsements, or to learn more about how to trade mortgages on the world market with some degree of standardization please see our commercial title insurance brochure or contact us directly.
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