Reading a Title Commitment: The Schedules in Order

A title commitment is an offer to issue a policy on stated terms. Read in order, its schedules answer three questions: what is being insured and for whom, what must happen before the policy will issue, and what the insurer will not cover. Nearly every unpleasant surprise at closing was visible in one of them.

Schedule A — the basics, checked carefully

Effective date, the policy or policies to be issued and their amounts, the estate or interest, the current vested owner, and the legal description.

• Does the vested owner exactly match the seller on the purchase contract? Marital status, trusts, deceased co-owners and entity name changes all surface here.

• Is the estate what the buyer thinks they are getting — fee simple, or leasehold?

• Does the legal description match the contract, the survey and the tax parcel?

• Is the policy amount adequate — for the owner's policy, the purchase price; for the loan policy, the loan amount?

• How old is the effective date? It will need updating before closing.

Requirements — what must be done

These are the conditions of issuance, and they are the closing to-do list: payoff and release of existing mortgages, satisfaction of judgment liens, execution and recording of the deed, evidence of authority for entity sellers, probate documentation, and payment of premiums and taxes.

Work through them early. Requirements involving third parties — a lienholder who is slow to issue a payoff, a probate court, a lender that no longer exists and whose successor must be traced — set the real timeline, and none of them move faster because the closing date is near.

An exception the insurer lists is a risk they have declined. If it matters to the buyer, it has to be resolved before closing, not after.

Exceptions — what is not covered

Standard exceptions cover things like rights of parties in possession, unrecorded easements, mechanics' liens and boundary matters — many of which can be removed by a satisfactory survey and appropriate affidavits. Specific exceptions are the ones to read in full:

• Recorded easements — and where on the parcel they run.

• Covenants, conditions and restrictions, including any HOA regime.

• Mineral, timber or water rights previously severed.

• Leases, options and rights of first refusal.

• Encroachments and setback issues shown by survey.

Get the underlying documents

The commitment gives recording references, not content. Order the actual instruments for every specific exception. A restriction summarised in one line can prohibit exactly what the buyer intends to do, and that is not discoverable from the reference alone.

Match it against the buyer's plans

The review is only complete when the exceptions have been compared with what the buyer intends: an extension, a fence, a home business, a subdivision, access for a vehicle. Title work is technically correct and practically useless if nobody asked what the buyer is going to do with the property.

Consider the endorsements

Where a risk cannot be removed, endorsements may provide coverage for specific concerns — survey, access, zoning, contiguity, restrictions. Availability and cost vary by state and insurer, and they need requesting before the policy issues rather than after.

This is a general orientation, not legal advice. Title practice, standard exceptions, available endorsements and whether an attorney must be involved all vary by state; work from the actual commitment and with counsel licensed where the property sits.