ALTA Endorsement 32.1 (Construction Loan - Direct Payment) (7-1-21)

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ALTA Endorsement 32.1 (Construction Loan - Direct Payment) (7-1-21)

Form Document
08/16/2021
V 8

ALTA Endorsement 32.1 (Construction Loan - Direct Payment) (7-1-21)

This Endorsement is Issued as Part of Policy Number ______________________

Issued By
Stewart Title Guaranty Company

File No.: ______________________

 Charge: ______________________

1.      Covered Risk 11.a. of this policy is deleted.

2.      The insurance for Construction Loan Advances added by Section 3 of this endorsement is subject to the exclusions in Section 4 of this endorsement and the Exclusions from Coverage in the Policy, the provisions of the Conditions, and the exceptions contained in Schedule B. For the purposes of this endorsement and each subsequent Disbursement Endorsement:

a.      “Construction Loan Advance:” An advance that constitutes Indebtedness made on or before the Date of Coverage for the purpose of financing in whole or in part the construction of improvements on the Land.

b.      “Date of Coverage”:____________________________ unless the Company sets a different Date of Coverage by an ALTA 33 Disbursement Endorsement issued at the discretion of the Company.

c.      “Mechanic’s Lien”: Any statutory lien or claim of lien under State law, affecting the Title, that arises from services provided, labor performed, or materials or equipment furnished.

3.      The Company insures against loss or damage sustained by the Insured by reason of:

a.      The invalidity or unenforceability of the lien of the Insured Mortgage as security for each Construction Loan Advance made on or before the Date of Coverage;

b.      The lack of priority of the lien of the Insured Mortgage as security for each Construction Loan Advance made on or before the Date of Coverage, over any lien or encumbrance on the Title recorded in the Public Records and not shown in Schedule B; and

c.      The lack of priority of the lien of the Insured Mortgage, as security for each Construction Loan Advance made on or before the Date of Coverage over any Mechanic’s Lien, if notice of the Mechanic’s Lien is not filed or recorded in the Public Records, but only to the extent that direct payment to the Mechanic’s Lien claimant for the charges for the services, labor, materials, or equipment for which the Mechanic’s Lien is claimed has been made by the Company or by the Insured with the Company's written approval.

4.      This policy does not insure against loss or damage and the Company will not pay costs, attorneys’ fees, or expenses by reason of any lien or claim of lien arising from services, labor, material, or equipment:

a.      Furnished after the Date of Coverage; or

b.      To the extent that the Mechanic’s Lien claimant was not directly paid by the Company or by the Insured with the Company's written approval.

Date: _____________________

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For issuing guidelines on this form, see Guidelines.