Reading a Commitment or Prelim.
You get one after escrow opens when you buy or sell, but what is it? It sets forth the title insurance company’s conditions and requirements to issuance of a policy of title insurance. It’s important because it can reveal adverse matters that can stop your closing. Basically the Commitment /Preliminary Title Report has 3 sections: Schedule A indicates the amount of insurance, the form of the policy, the parties to be insured, and a description of the property. Schedule B includes the Exclusions – a list of the specific title matters relating to the property which will be excluded from coverage (in addition to the “fine print” that appears at the end of the form). The Requirements section lists matters that must be removed, satisfied or otherwise eliminated prior to, or at the time of closing, as a condition to issuance of the policy of title insurance – and the closing. For help on figuring out what the contents of those sections mean, ask SimplySOLD.