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Title Insurance Before Mortgage Commitment

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Joe1050

Junior Member
I am a Licensed Mortgage Banker with 40 years in the business. Recently, Lenders are requesting a Title Insurance Policy before they will issue
a commitment​
. The problem with that is most New Jersey attorneys will not order title until they have a mortgage commitment. I agree with this, but how do I show any legal prededent to these lenders who insist they need this in order to render a credit decision. Also, the title company is not too happy to get a cancelation if the loan is not approved.
New JerseyWhat is the name of your state (only U.S. law)?
 


nextwife

Senior Member
That is going to be a problem. In states like WI. the loan policy is merely a piggy back policy issued simultaneously with the Owner's Policy, and the state bar approved purchase contract customarily requires the SELLER to pay for and order (contract provided that it is seller's choice of provider)the owners policy, and that it be provided within 15 days prior to CLOSING. The loans policy is merely a simultaneously issued policy, normally by the same provider.

Have you provided a copy of the purchase contract, highlighting the title provisions and inquired WHO will reimburse the title provider if the loan is denied? Or are they demanding the title companies do this for them for FREE?
 

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