This is a guest post from Title Source. Title Source is one of the largest providers of title insurance, property valuations and settlement services in the nation.
A title endorsement is an addition or limitation of coverage that is attached to a title insurance policy. Endorsements provide coverage that tailors the policy to fit the needs of the insured for a specific transaction.
Are Title Endorsements Required?
Most mortgage companies require endorsements on a Lender’s Title Insurance Policy. Although a borrower can request endorsements to provide additional protections beyond the standard coverage, endorsements on an Owner’s Title Insurance Policy are uncommon. (To learn more about lender’s and owner’s title insurance policies, click here!)
How Are Endorsements Regulated?
The American Land Title Association (ALTA) is the authority that regulates and sets guidelines for the different types of endorsements. There are other associations that regulate guidelines for endorsements for specific states. Those include Title Insurance Rate Service Association (TIRSA) in New York, Title Insurance Rating Bureau of Pennsylvania (TIRBOP), and the California Land Title Association (CLTA).
What Are the Most Common Title Endorsements?
There are nearly 100 different title endorsements, and more than one can be applied depending on loan type, property type, property location and other variables. Below are some of the most common endorsements:
· Alta Form 4 – Condominium
· Alta Form 5 -Planned Unit Development
· Alta Form 6 – Adjustable Rate Mortgages and Negative Amortization Loans
· Alta Form 7 – Manufactured Housing
· Alta Form 8 – Environmental Protection
· Alta Form 9 – Restrictions, Encroachments, Minerals
· Alta Form 14.2 – Stand-Alone Second Mortgage and Future Advance
· Alta Form 14.3 – Reverse Mortgages
How Much Does a Title Endorsement Cost?
The costs of endorsements depend on the underwriter and the state. Endorsements are a one-time fee and most range between $25 -$75.
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