CLTA Form 122.1B-06 (11-04-11) Construction Loan Advance-Subsequent Disbursement

CLTA Form 122.1B-06 (11-04-11)                      Construction Loan Advance-Subsequent Disbursement

ALTA – Lender                                                                               2006 ALTA Loan Policy

 

ENDORSEMENT

Attached to Policy No.

Issued by

BLANK TITLE INSURANCE COMPANY

 

            Based upon the representation of the Insured that the Insured has made an advance in the sum of $                              (the “Advance”), [for a cumulative total Advance of                    ]  which is a  portion  of the Indebtedness, the Company hereby (a) increases the Mechanics’ Lien Coverage Liability Limit (defined in paragraph _____ of Schedule B) by the amount of the Advance,  to a total Mechanics’ Lien Coverage Liability Limit  of $                         , and (b) extends the Mechanics’ Lien Coverage Cut-Off Date (defined in paragraph              of Schedule B) to                                

The Company also insures against loss or damage sustained or incurred by the Insured by reason of:

1.         Any lien, encumbrance or other matter affecting the Title and recorded in the Public Records subsequent to Date of Policy, to the date of this endorsement, except:

2.         Any subsisting tax or assessment lien which is prior to the lien of the Insured Mortgage, as of the date of issuance of this endorsement, except:

3.         Title being vested as of the date of issuance of this Endorsement other than as shown in Schedule A according to the Public Records;

4.         The failure of the Advance to be secured by the Insured Mortgage;

5.         Lack of priority of the lien of the Insured Mortgage with respect to the Advance over any lien, encumbrance or other matter affecting the Title and recorded in the Public Records subsequent to Date of Policy and as of the date of issuance of this Endorsement, except:

6.         Lack of priority of the lien of the Insured Mortgage over any statutory lien for services, labor or material arising out of the work of improvement under construction or completed, but only to the extent that such lien is for services provided, labor performed or materials furnished prior to ________________________.

            This endorsement is issued as part of the policy.  Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance.  To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls.  Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

 

                                                                                BLANK TITLE INSURANCE COMPANY

Dated:                                                                   By                                                                   

                                                                                                            CLTA 122.1B-06 (11-04-11)

                                                                                                                                ALTA - Lender

 

[NOTE: Add to the preliminary report or title commitment and loan policy of title insurance a separate Schedule B exception re Mechanics’ Lien Coverage Cut-Off Date Definition and Pending Disbursement for subsequent advances]

 

CLTA Form 122.1B-06:  Information Page –  Schedule B Exception re Mechanics’ Lien Coverage Cut-Off Date Definition and Pending Disbursement  must be added to Preliminary Report or Title Commitment and Loan Policy  prior to issuance of  CLTA 122.1B-06:

 

Notwithstanding the Amount of Insurance stated in Schedule A, the liability of the Company under the policy (the “Mechanics’ Lien Coverage Liability Limit”) for loss or damage by reason of the lack of priority of the lien of the Insured Mortgage upon the Title over any statutory lien for services, labor or material is limited as of the Date of Policy to $                             , being the amount of the Indebtedness actually disbursed at Date of Policy.  The Mechanics’ Lien Coverage Liability Limit may only be increased and the Mechanics’ Lien Coverage Cut-Off Date may only be brought forward by the Company’s issuance of its CLTA Form 122.1B-06 Endorsement which expressly (a) increases the Mechanics’ Lien Coverage Liability Limit (to the aggregate amount represented by the Insured as actually paid and disbursed by the Insured at the date of the 122.1B-06 Endorsement) and (b) brings forward the Mechanics’ Lien Coverage Cut-Off Date. 

No guidelines are available for this form at this time.