Bulletin: SC2012001

Date:
April 27, 2012
To:
All South Carolina Issuing Offices
RE:
New or Revised Forms Filed in South Carolina

Dear Associates:    

Recently, new or revised ALTA Forms were filed with the Department of Insurance for South Carolina. These forms have been approved by the Department as of April 13, 2012, for use in South Carolina effective immediately. You may find the new and revised forms and Guidelines for issuance thereof online at www.vuwriter.com. The following will outline the policies and endorsements that have been approved: 

ALTA Homeowner’s Policy of Title Insurance (02/03/10) 

The ALTA Homeowner’s Policy of Title Insurance (02/03/10) is designed to incorporate the changes of the 2006 Owner’s Policy and improve the title insurance coverage given to the insured. The only changes in the 2010 policy include: 

-The expansion of the Continuation of Coverage provision by adding provision b.5 to the policy.  

-The inclusion of a creditor’s rights exclusion (No. 7) that is consistent with the Covered Risks. 

-The new definition for Estate Planning Entity was added to the definition section.  

ALTA Expanded Coverage Residential Loan Policy for a One-to-Four Family Residence (7/26/10)
ALTA Short Form Expanded Coverage Residential Loan Policy (7/26/10) 

The ALTA Expanded Coverage Residential Loan Policy for a One-to-Four Family Residence (7/27/10) is designed to incorporated the changes of the 2006 Loan Policy and improve the title insurance coverage given to the insured. The only changes in the policy include: 

-The inclusion of a creditor’s rights exclusion (No. 9) that is consistent with the Covered Risks. 

-The change in Section 8(a)(iii) language to be more consistent to the existing ALTA Loan Policy of 6/17/06.  

New Endorsements 

The American Land Title Association has adopted new endorsements which are to be used with the 2006 policy forms currently in use. These endorsements which have been approved for use in South Carolina by the Department of Insurance are as follows:

ALTA Endorsement 11.1-06 Mortgage Modification with Subordination. This endorsement is designed for issuance when an intervening lien is subordinated by agreement to the insured mortgage in connection with the modification of the insured mortgage. This form is similar to the ALTA Endorsement 11-06 which is already available in South Carolina.

ALTA Endorsement 29-06 Interest Rate Swap Endorsement-Direct Obligation. This new endorsement insures the validity, priority, and enforceability of the lien of the Insured Mortgage as security for the repayment of the Swap Obligation. This endorsement will only be issued for Commercial transactions.

ALTA Endorsement 29.1-06 Interest Rate Swap Endorsement-Additional Interest. This new endorsement insures the validity, priority, and enforceability of the lien of the Insured Mortgage as security for the repayment of the Swap Obligation that is considered additional interest. This endorsement will only be issued for Commercial transactions.

ALTA Endorsement 29.2-06 (Interest Rate Swap Endorsement - Direct Obligation - Defined Amount) (08-01-11). This endorsement insures against loss or damage, not to exceed the Additional Amount of Insurance, by reason of the invalidity, unenforceability or lack of priority of the lien of the Insured Mortgage as security for the repayment of the Swap Obligation at Date of Endorsement. 

ALTA Endorsement 29.3-06 (Interest Rate Swap Endorsement - Additional Interest - Defined Amount (08-01-11).  This endorsement insures against loss or damage, not to exceed the Additional Amount of Insurance, by reason of the invalidity, unenforceability or lack of priority of the lien of the Insured Mortgage as security for the repayment of the Additional Interest at Date of Endorsement.

ALTA Endorsement 30-06 One To Four Family Shared Appreciation Mortgage. This new endorsement may be used in connection with loan workouts or other finance transactions where the mortgage could secure payment of a portion of the appreciation in value of the land. The endorsement is designed for issuance on mortgages covering one-to-four family residences. 

ALTA Endorsement 31-06 (Severable Improvements) Adopted 02-03-11. This new endorsement insures against covered loss with respect to property affixed to the land that does not constitute real property. This endorsement applies to commercial properties and insures not only specified loss resulting in the reduction in value of the insured's interest in any Severable Improvement, but also stated cost actually incurred in connection with the removal of any Severable Improvement.

ALTA Endorsement 32-06 (Construction Loan - Loss of Priority) Adopted 02-03-11. This new endorsement provides stated insurance with respect to the validity or priority of the lien of the Insured Mortgage as security for each Construction Loan Advance made on or before the Date of Coverage.

ALTA Endorsement 32.1-06 (Construction Loan - Loss of Priority - Direct Payment) Adopted 02-03-11. This new endorsement provides stated insurance with respect to the validity or priority of the lien of the Insured Mortgage as security for each Construction Loan Advance made on or before the Date of Coverage.

ALTA Endorsement 33-06 (Disbursement) Adopted 02-03-11. This new endorsement provides for a change to the Date of Coverage, but not the Date of Policy. This endorsement does not serve to change the dates on any endorsements and/or extended coverage.

ALTA Endorsement 34-06 (Identified Risk Coverage) (08-01-11).  This endorsement insures against loss or damage sustained by the Insured by reason of: (a.) A final order or decree enforcing the Identified Risk in favor of an adverse party; or (b.) The release of a prospective purchaser or lessee of the Title or lender on the Title from the obligation to purchase, lease, or lend as a result of the Identified Risk, but only if (i.) there is a contractual condition requiring the delivery of marketable title, and (ii.) neither the Company nor any other title insurance company is willing to insure over the Identified Risk with the same conditions as in this endorsement.

REVISED FORMS

Additionally, new versions of the ALTA endorsements have been filed to aid in the understanding and interpreting of the 2006 polices as follows:

  • ALTA Endorsement 3.1-06 Zoning-Completed Structure
  • ALTA Endorsement 4-06 Condominium
  • ALTA Endorsement 5-06 Planned Unit Development
  • ALTA Endorsement 10-06 Assignment 
  • ALTA Endorsement 10.1-06 Assignment and Date Down 
  • ALTA Endorsement 13-06  Leasehold-Owner's 
  • ALTA Endorsement 13.1-06 Leasehold-Loan 
  • ALTA Endorsement 14-06 Future Advance-Priority 
  • ALTA Endorsement 14-06 Future Advance-Priority without MML 
  • ALTA Endorsement 14.1-06 Future Advance-Knowledge 
  • ALTA Endorsement 14.1-06 Future Advance-Knowledge without MML 
  • ALTA Endorsement 14.2-06 Future Advance-Letter of Credit 
  • ALTA Endorsement 14.2-06 Future Advance-Letter of Credit without MML 
  • ALTA Endorsement 14.3-06 Future Advance-Reverse Mortgage 
  • ALTA Endorsement 14.3-06 Future Advance-Reverse Mortgage without MML
  • ALTA Endorsement 28-06 Easement-Damage or Enforced Removal 

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
ALTA Endorsement 10-06 (Assignment) Revised 02/03/10
 
ALTA Endorsement 10.1-06 (Assignment and Date Down) Revised 02/03/10 Technical Correction 08-01-16
 
ALTA Endorsement 11.1-06 (Mortgage Modification with Subordination) (10/22/09)
 
ALTA Endorsement 13-06 (Leasehold - Owner's) Revised 04-02-12
 
ALTA Endorsement 13.1-06 (Leasehold - Loan) Revised 04-02-12
 
ALTA Endorsement 14-06 (Future Advance - Priority) Revised 02-03-11
 
ALTA Endorsement 14-06 (Future Advance-Priority) (without MML) 02-03-11
 
ALTA Endorsement 14.1-06 (Future Advance - Knowledge) Revised 2-3-11
 
ALTA Endorsement 14.1-06 (Future Advance-Knowledge) (without MML) 02-03-11
 
ALTA Endorsement 14.2-06 (Future Advance - Letter of Credit) Revised 02-03-11
 
ALTA Endorsement 14.2-06 (Future Advance-Letter of Credit) (without MML) 02-03-11
 
ALTA Endorsement 14.3-06 (Future Advance - Reverse Mortgage) Revised 02-03-11
 
ALTA Endorsement 14.3-06 (Future Advance-Reverse Mortgage) (without MML) 02-03-11
 
ALTA Endorsement 28-06 (Easement - Damage or Enforced Removal) Revised 02/03/10
 
ALTA Endorsement 29-06 (Interest Rate Swap Endorsement - Direct Obligation) (02-03-10) Technical Corrections (04-02-14; 08-01-16)
 
ALTA Endorsement 29.2-06 (Interest Rate Swap Endorsement - Direct Obligation - Defined Amount) (08-01-11) Technical Corrections (04-02-14)(08-01-16)
 
ALTA Endorsement 29.3-06 (Interest Rate Swap Endorsement - Additional Interest - Defined Amount) (08-01-11) Technical Corrections (04-02-14; 08-01-16)
 
ALTA Endorsement 3.1-06 (Zoning-Completed Structure) Revised 10/22/09
 
ALTA Endorsement 30-06 (Shared Appreciation Mortgage) (7-26-10)
 
ALTA Endorsement 31-06 (Severable Improvements) Adopted 02-03-11
 
ALTA Endorsement 32-06 (Construction Loan - Loss of Priority) Adopted 02-03-11
 
ALTA Endorsement 32.1-06 (Construction Loan - Loss of Priority - Direct Payment) Adopted 02-03-11
 
ALTA Endorsement 33-06 (Disbursement) Adopted 02-03-11
 
ALTA Endorsement 34-06 (Identified Risk Coverage) (08-01-11)
 
ALTA Endorsement 4-06 (Condominium - Assessments Priority) Revised 02-03-10 Technical Correction 12-01-16
 
ALTA Endorsement 5-06 (Planned Unit Development - Assessments Priority) Revised 02-03-10 Technical Correction 12-01-16, 12-01-17