The Title Commitment: A Vital Document in Property Transactions


A title commitment is a legally binding agreement between a title insurance company and either the buyer or the lender that outlines the details of a property and its title. This document is a crucial piece of information for anyone involved in a property transaction, as it outlines the terms and conditions behind issuing title insurance for the property.


Breaking Down the Title Commitment


Title commitments typically come in four sections, although the specifics may vary based on the state where the property is located.


Schedule A: Outlines the details of the transaction, including the date and amount, as well as the types of policies that will be issued. It also lists the legal owner of the property, the type of interest the buyer will acquire in the property, and the legal description of the property.


Schedule B: Describes the requirements, exclusions, and exceptions of the title insurance policy. This schedule is especially important for buyers, as it details what is not covered by the title policy, such as specific restrictions or mineral severances.


Schedule C: Lists any requirements that must be met before closing, such as outstanding mortgages, tax liens, and home improvement liens. Both buyers and sellers should pay close attention to this schedule, as it outlines the conditions that must be satisfied to close on the property.


Schedule D: Discloses information about the parties involved in the transaction and their share of the title premiums, including title agents and underwriters.


In conclusion, the title commitment is an essential document for anyone involved in a property transaction. Understanding the different sections and details outlined in the title commitment can help buyers, sellers, and lenders make informed decisions and ensure a smooth and successful transaction.