CLTA Priority of Lease Endorsement Guideline 119.2
Explanation:The CLTA 119.2 Endorsement provides an ALTA lender on the leasehold or the fee with insurance that the lease is valid and currently in existence and that it is shown in the policy according to the order of its priority.
Underwriting Requirements:(1) A search of the records is required in order to determine:
(a) The lease was recorded;
(b) That the lease was properly executed by the record owner;
(c) That the lease created a valid leasehold estate (will require a review of lease);
(d) That the lease is still in existence (no quit claim deed or other termination); and
(e) A statement must be obtained from the lessor and lessee that the lease has not been terminated and that no default currently exists.
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):