CLTA Assurances Concerning Negative Covenants in a Lease Endorsement Guideline 124.3
Explanation:This Endorsement provides the lessee, under a leasehold policy, or lender on a leasehold loan policy, with assurances that the lessor's negative covenants (acts not to be done on the property owned by the lessor which is contiguous to the leased land except for intervening public streets, alleys or sidewalks) are binding upon the lessor, certain successive owners and certain successive mortgagees while in possession of the burdened contiguous real property described in the lease.
Underwriting Requirements:(1) This endorsement is often requested when insuring shopping center developments.
(2) This endorsement may be issued when all of the following requirements are met:
(a) The land to be affected by the negative covenants must be specifically described in the lease.
(b) The negative covenants contained within the lease must run with the land and bind successive lessors.
(c) A complete search of the burdened property must be made.
(3) Approval to issue this endorsement must be obtained from the appropriate Stewart Title Guaranty underwriting personnel.
(4) When negative and affirmative covenants are to be insured, use CLTA 124.3 and CLTA 124.2 Endorsements.
The underwriting guidelines contained herein have been provided for general reference. The facts, circumstances, and location of the subject property should be considered when determining the issuance of the requested form or endorsement. Please note that all of the forms and endorsements included in this system may not be available in all states. Accordingly, please contact the appropriate Stewart Title Guaranty Company underwriting personnel in order to determine availability.
Compliance with the underwriting guidelines contained herein in no way obligates Stewart Title Guaranty Company to issue any form or endorsement.
This guideline applies to the following form(s):