- June 09, 2004
- All Issuing Offices in New Mexico
- New Rates, Rules and Forms Effective July 1, 2004
The Superintendent of Insurance adopted new rates, forms and rules effective
The variable portion of the rates was reduced 2%. Flat fees (such as endorsements and simultaneous issue rates) were not changed.
The new rate schedule (for original Owner's Policies) is attached as Exhibit 1.
The range of underwriter/agent division of premium was not changed.
ALTA Short Form Loan Policy (Modified) (NM 63) (NMAC 22.214.171.124)
Guidelines for the Short Form Residential Loan Policy (NM 63) are attached as Exhibit 2.
The policy is substantially the same as the ALTA Short Form Loan Policy (2000) and is acceptable to Fannie Mae, Freddie Mac, and Ginnie Mae. Minor changes were made to refer to New Mexico Endorsements and to add water rights (paragraph 7) and arbitration (paragraph 6) exceptions in Schedule B.
You should issue the Short Form Loan Policy on One to Four Family Residential Property, if the lender instructions request or allow the policy. You should issue the Short Form Loan Policy (NM 63) only on a fee, not on a leasehold interest. We place no acreage limits for land that is "One to Four Family Residential Property."
Use of the Short Form Loan Policy (NM 63) will reduce errors. That means you will spend less time correcting policies after closing. Be aware of some of the common errors that still may occur if you use the Short Form Loan Policy (NM 63): (1) amount of insurance less than loan amount; (2) mortgage amount incorrect; (3) insured's name incomplete or incorrect; and, (4) borrower's name does not match mortgage.
The Short Form Loan Policy (NM 63) reduces time and expenses for both you and the lender in preparation and review. We recommend you market it to your lenders: many will want it once they understand it. Lenders commonly requesting or allowing issuance of the Short Form Loan Policy in other states include ABN AMRO, Bank of America, Chase, Countrywide, First Horizon, First Union, Homeside Lending, Principal Residential Mortgage, Travelers, Wachovia, Washington Mutual, Wells Fargo, and World Savings.
The premium for this policy is the same as the rate for the Loan Policy (NM 2). The charges for deletion/amendment of standard exceptions and for endorsements incorporated by box reference also are the same as the charges for coverage to the Loan Policy (NM 2).
Foundation Endorsement (NM 61) (NMAC 126.96.36.199)
Guidelines for the Foundation Endorsement (NM 61) are attached as Exhibit 3.
The Foundation Endorsement (NM 61) insures that a foundation (1) is within the boundary lines of the land, (2) does not violate covenants, conditions and restrictions (such as setback lines) because of its location, and (3) does not encroach into easements. If encroachments into setback lines or easements are shown on the survey, they may be accepted in the endorsement. NMAC 188.8.131.52. The premium for the endorsement is (1) $25 for one-to-four family residential policies, and (2) $50 for commercial policies. NMAC 184.108.40.206.
The Foundation Endorsement (NM 61) may be issued to on a Loan Policy or Construction Loan Policy. It may not be issued on an Owner's Policy.
Assignment of Rents/Leases Endorsement (NM 62) (NMAC 220.127.116.11)
Guidelines for the Assignment of Rents/Leases Endorsement (NM 62) are attached as Exhibit 4.
The Assignment of Rents/Leases Endorsement (NM 62) insures that the Assignment of Rents/Leases was properly executed, and that no prior assignment of the lessor's (landlord's) interest in rents or leases appears in the public records unless excepted in Schedule B. The premium for the endorsement is $100. NMAC 18.104.22.168.
The Assignment of Rents/Leases Endorsement (NM 62) may be issued with a Loan Policy or Leasehold Loan Policy (Loan Policy with Leasehold Endorsement attached). It may not be issued on an Owner's Policy. The endorsement may not be issued with residential property containing four or fewer dwelling units. NMAC 22.214.171.124.
Deletion of Item 8 of Schedule B (NMAC 126.96.36.199)
Standard Exception 8 is "Taxes or assessments which are not shown as existing liens by the public records." This exception may be deleted from the Loan Policy, Leasehold Loan Policy, or Construction Loan Policy, if (1) you perform a tax search and (2) all taxes and assessments will be paid. NMAC 188.8.131.52. Standard Exception 8 may not be deleted from owner's policies. The premium for deletion of this Standard Exception is $25.
Amended NM Form 35 Notice to Proposed Insured (NMAC 184.108.40.206)
The Superintendent amended NM Form 35 Notice to Proposed Insured to disclose that the charge for deleting certain exceptions is $25, instead of $32. The revised form is attached as Exhibit 5.
Rate for Manufactured Housing Endorsement (NMAC 220.127.116.11)
The rate for the Manufactured Housing Endorsement (NM 16) is increased from $25 to $50. NMAC 18.104.22.168.
Rate for Foreclosure Guarantee Policy and Subsequent Owner's Policy (NMAC 22.214.171.124)
The Superintendent reduced the rate for the Foreclosure Guarantee Policy (NM 41) from 80% of the full basic rate to 55% of the full basic rate. If an Owner's Policy is issued following foreclosure, the Owner's Policy may be issued for 55% of the full basic rate. If litigation is terminated by reinstatement of the lien, and a new Owner's Policy is issued to a buyer within one year after issuance of the Foreclosure Guarantee Policy (NM 41), 50% of the premium paid for the Foreclosure Guarantee Policy (NM 41) shall be credited to the new Owner's Policy premium. NMAC 126.96.36.199.
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.
188.8.131.52 PREMIUM RATES FOR ORIGINAL OWNER'S POLICIES: The following schedule of premium rates for original owner's policies shall be in effect from July 1, 2004 until modified by the Superintendent:
|Up to:||Up to:||Up to:|
|For amounts of insurance
|Portion of rate (per thousand)
subject to agent commission
|Additional rate per $1000 to be collected on policy amounts in excess of $10 million (solely for underwriter)||Total
|over $50 to $100||$ 6.10||78-80%||$ 6.10|
|over $100 to $500||$ 4.80||78-80%||$ 4.80|
|over $500 to $2,000||$ 3.77||78-80%||$ 3.77|
|over $2,000 to $5,000||$ 3.03||75%||$ 3.03|
|over $5,000 to $10,000||$ 2.52||70%||$ 2.52|
|over $10,000 to $25,000||$ 2.16||65%||$ 0.25||$ 2.41|
|over $25,000 to $50,000||$ 1.88||60%||$ 0.25||$ 2.13|
|over $50,000||$ 1.50||50%||$ 0.25||$ 1.75|
[6-16-86...4-3-95; A, 5-1-99; 184.108.40.206 NMAC - Rn, 13 NMAC 220.127.116.11 & A, 5-15-00; A, 5-31-00; A,
8-1-00; A, 3-1-02; A, 7-1-03; A, 7-1-04]
- Bulletins Replaced:
- Related Bulletins:
- Underwriting Manual:
- Exceptions Manual: