Oklahoma Real Estate Practices
- Attorney Involvement
- Cancellation/Commitment Fee
- Certificate of Release (of Mortgage)
- Good Funds Requirements
- Joinder of Spouses
- Mortgage Tax
- Payment Customs
- Policy Countersignatures
- Real Estate Taxes
- Search and Examination Fees
- Search Requirements
- Security Instruments (Deed of Trust vs. Mortgage)
- Standard Exceptions and Requirements
- State-specific Policy Variations
- Title Insurance Form and Filing Regulations
- Transfer Taxes
- Withholding Taxes
- Witness Requirements
Please describe any requirements under applicable state law for attorney, abstractor or other special professional involvement, for example, in the search, examination, opinion of title, signing, closing, disbursement, recording, preparation of documents, and/or policy-issuance.
An opinion of title by an Attorney licensed to practice law in Oklahoma based upon an examination of a duly certified abstract of title prepared by a licensed and bonded Oklahoma Abstractor is required prior to the issuance of a Commitment or Policy of Title Insurance.
Title companies, title agents and attorney agents must be licensed by the Oklahoma Insurance Department. 36 O.S. § 5001 (c); 36 O.S. § 1435.1 et seq; OID Rule 365:20-3-2.
Does your state permit or require a cancellation fee or commitment fee upon cancellation?
Title Insurance rates and fees are not regulated in the State of Oklahoma. A commitment fee or cancellation fee may be charged in Oklahoma.
Certificate of Release (of Mortgage)
If anyone other than the lender (such as a title agent, settlement agent, underwriter or attorney) has the authority to release the security instrument, please describe.
The Oklahoma Legislature passed Senate Bill 443, with an effective date of November 1, 2015, and codified as 36 O.S. Section 5008, which provides for the filing of an Affidavit of Release of Mortgage. Proper notice to the lender, as set forth in the statute, must be given. Please contact a Stewart underwriter for guidance.
Prior to November 1, 2015, no one other than the lender or its assigns is authorized to release a security instrument in Oklahoma.
Standard Release or Satisfaction of Mortgage forms utilized in Oklahoma are referenced below.
Please describe the kinds of deeds that are customary for commercial and residential transactions. Please describe the kinds of deeds that are generally not insurable.
The customary form of conveyance for commercial and residential transactions in Oklahoma is the Warranty Deed. Other forms of conveyances are included in the references below.
Attestation and corporate seals are no longer required on corporate conveyances in Oklahoma.
Deeds not Insurable:
Transfer-on-Death deeds are not insurable due to the fact the interest conveyed does not vest until the death of the grantor and is documented per statute, 58 O.S. §1251 et seq.
Good Funds Requirements
Is there a good funds requirement in your state?
Joinder of Spouses
If a non-title holding spouse is required to join in the execution of a deed or a security instrument, please describe. Any analogous rights, such as those in a civil union or equivalent, should also be addressed.
Joinder of Spouses is required for conveyance or encumbrance of a Homestead Property. 16 O.S. § 4; 31 O.S. § 2. There is a presumption that the requirement for joinder of spouses also applies to a Civil Union, although this topic is not addressed in the Oklahoma Statutes.
Is there a mortgage tax in your state? If yes, is it uniform across the state or does it vary? If it is uniform, please describe.
The current rate for mortgage tax is $ .10 per one hundred dollars of indebtedness for a maturity date of 5 years or longer; plus a mortgage certification fee of $5.00. This tax is uniform across the State. 68 O.S. §1904.
Who customarily pays for:
(a) Owner’s Policy?
(b) Transfer Tax & Recording Fee?
(c) Survey Charges?
(d) Closing/Settlement Fees?
(a) Owner’s/Loan Policy: The Purchaser typically pays for both the Owner’s and Loan Policies.
(b) Transfer Tax and Recording Fees: Paid by the Seller.
(c) Survey Charges: The Seller pays for the Mortgage Inspection report required by the lender, per contract. If the Purchaser requests a “PIN” Survey, he pays for the Survey. Sometimes negotiable.
(d) Closing/Settlement fees: Typically the parties to the transaction each pay 1/2 of the Closing/Settlement fees, however, this practice is negotiable.
Please describe any statutory or regulatory requirements for countersignatures in order to issue the policy (for example, residency requirements).
Title Commitments, Policies and Endorsements shall be countersigned by some person, partnership, corporation or agency actively engaged in the real estate title business and maintaining an office in the state, who is a duly appointed agent of a title insurance company holding a valid license and authorized to do business in the state. 36 O.S. §5001(C).
Real Estate Taxes
Please describe the general tax year, due dates, and delinquency dates, including lien dates and payment cycle.
Real Estate Taxes/Ad Valorem Taxes become due November 1st; taxes can be paid in one or two installments. If paid in two installments, the first payment is due on or before December 31st and the second payment is due on or before March 31st. Ad Valorem Taxes are delinquent if not paid on or before the first day of January.
Ad Valorem Taxes, together with any interest, penalty and costs, which become a lien on real property, are deemed released and extinguished upon the expiration of 7 years after the date upon which they became due.
Search and Examination Fees
Is it permissible and/or customary to charge a separate search and/or examination fee, and under what circumstances? If your jurisdiction is all-inclusive, please state that.
The Seller customarily pays for the abstracting and examination fees. These fees must be charged as a separate fee on the HUD. All-Inclusive fees are prohibited by statute.
Is there a minimum period of time for a title search required: (a) by state law, (b) pursuant to marketable record title acts, or (c) by any other applicable title examination standards (e.g., state bar association)? Please respond to each category. If a minimum search period exists for any category, please state it.
Oklahoma law requires that the period of time for the search of title is from the inception of title (Statehood). All abstract/title plants in Oklahoma must consist of a set of records in which an entry has been made of all documents or matters which legally impart constructive notice of matters affecting title to real property, which are filed or recorded in the offices of the county clerk and the court clerk for which such abstract/title plant is maintained. 1 O.S. § 21.
Abstracting relating to court proceedings under the Simplification of Land Titles Act, 16 O.S. §62(b), (c) & (d), when instruments have been entered or recorded for 10 years or more, may be limited as provided in the statute. Oklahoma Title Standard No. 29.1, 29.6.
The Marketable Record Title Act, 16 O.S. §§ 71 – 80 is remedial in character and can be relied upon as a cure or remedy for such imperfections as fall within its scope. Oklahoma Title Standard No. 30.1, 30.13.
Security Instruments (Deed of Trust vs. Mortgage)
Please describe the customary and permissible form(s) of security instruments used in your state.
Who can be listed as the trustee on the Deed of Trust (e.g., residency and/or natural person requirements, etc.)? Can an underwriter or title agent be designated as the trustee, and, if so, is it customary?
The customary security instrument utilized in Oklahoma is the Mortgage. Every Deed of Trust on real property, intended as a security instrument, shall be subject to all statutory provisions and laws relating to mortgages. There is no provision in the Oklahoma statutes which address who may be designated as trustee under a Deed of Trust. Oklahoma statutes provide for a Mortgage with a Power of Sale. The statutes provide for non-judicial foreclosure of a Mortgage with a Power of Sale. However, this mortgage alternative is not commonly used.
46 O.S. § 40 et seq.
No suit, action or proceeding to foreclose or otherwise enforce the remedies in any mortgage, contract for deed or deed of trust shall be had or maintained after the expiration of 7 years from the date of the last maturing obligation secured by such mortgage, contract for deed or deed of trust becomes due as set out therein. 46 O.S. § 301(B).
Standard Exceptions and Requirements
Please identify the standard exceptions and requirements that are customarily used in your state.
Defects, liens, encumbrances, adverse claims or other matters, if any, created, first appearing in the public records or attaching subsequent to the Effective Date hereof but prior to the date the proposed Insured acquires for value of record the estate or interest or mortgage thereon covered by this Commitment.
Rights or claims of parties in possession not recorded in the Public Records.
Easements or claims of easements not recorded in the Public Records.
Encroachments, overlaps, boundary line disputes, or other matters which would be disclosed by an accurate survey or inspection of the Land.
Any lien, or right to a lien, for services, labor, material or equipment, heretofore or hereafter furnished, imposed by law and not recorded in the Public Records.
Taxes or assessments which are not recorded as existing liens in the Public Records.
Minerals of whatsoever kind, subsurface and surface substances, including but not limited to coal, lignite, oil, gas, uranium, clay, rock, sand and gravel in, on, under and that may be produced from the Land, together with all rights, privileges, and immunities relating thereto, whether or not appearing in the Public Records or listed in Schedule B. The Company makes no representation as to the present ownership of any such interests. There may be leases, grants, exceptions or reservations of interests that are not listed.
Show that restrictions or restrictive covenants have not been violated.
Payment to or for the account of the grantors or mortgagors of the full consideration for the estate or interest, mortgage or lien to be issued.
Furnish proof of payment of all bills for labor and material furnished or to be furnished in connection with improvements erected or to be erected.
Determine by gap check that no adverse documents, transactions, or other matters, affecting title, or as against insured owner(s) have been filed subsequent to the effective date of this commitment to the actual date of closing.
Obtain an affidavit of the Seller (Borrower) that said Seller or Borrower is not a foreign person as that term is defined in Section 1445 of the Internal Revenue Code of 1954 as amended (the Code), and the applicable regulations. If a foreign person, then compliance is required with the Code, its rules and regulations pertaining thereto.
Obtain an affidavit and indemnity from the Seller (Borrower) as to debts, liens and possession.
Have a certified survey performed by a registered land surveyor or civil engineer certifying that said survey was made on the ground of the subject property, that the same is correct and that there are no discrepancies, conflicts, shortages in area, boundary line conflicts, encroachments, overlapping of improvements, easements, or rights of way as shown herein, and that said property has access to and from a dedicated highway.
Joinder of Spouses is required for conveyance or encumbrance of homestead property. Marital status must be recited both in the body of the instrument and in the acknowledgement.
Corporate execution requires the signature of the President, Vice President, Chairman or Vice-Chairman of the Board of Directors.
A corporate instrument executed in another state may be accepted if it is executed either by the proper officers under Oklahoma law or by the proper officers under the laws of the state where the instrument was executed. 16 O.S. § 53, 93; Oklahoma Title Standard No. 12.2.
Attestation and corporate seal are no longer required in Oklahoma.
State-specific Policy Variations
If there are state-specific changes to the provisions in the ALTA policies (e.g., Arbitration, Minerals), please describe.
“Taxes for the year ______, the amount of which is not ascertainable or payable.”
“Statutory Section Line Road Easements in favor of the State of Oklahoma, where applicable.”
Title Insurance Form and Filing Regulations
Please describe the form and/or rate filing requirements, if any, related to policies and endorsements. Please describe any applicable rating bureau.
Title insurance rates are not filed or promulgated in Oklahoma.
Title insurance policy forms and endorsements are not filed or promulgated in Oklahoma. Stewart Title Guaranty Company prescribes the use of the standard ALTA Policy Forms and Endorsements for use in Oklahoma.
Is there a transfer tax in your state? If yes, is it uniform across the state or does it vary? If it is uniform, please describe.
The current rate for deed transfer tax (documentary stamps) is $1.50 per thousand dollars of consideration (Sales Price). Round sales price up to the next thousand.
Is usury coverage available?
Usury coverage is available in Oklahoma, by issuance of ALTA Endorsement 27-06 (Usury) (10-16-08), and requires approval of a Stewart Underwriter. Add exception at the end of the provision to “except to any claim that the rate of interest exceeds 45% per annum.” 14A O.S. §3-605; 14A O.S.
§5-107. The parties to a loan, other than a consumer loan, may agree for payment of any loan finance charge not in excess of the 45% rate specified in Section 5-107.
What are your state’s requirements, if any, with regard to withholding proceeds from a sale, similar to but not including FIRPTA?
There is no statutory provision for withholding proceeds from a sale on transactions similar to FIRPTA.
Are witnesses required on a deed or security instrument? If so, please describe.
No witnesses are required on a Deed or Security Instrument, with the exception of an instrument executed by one who is unable to sign his/her name; i.e., execution by mark. 16 O.S. §34.