Underwriting Manual: TX


Correction Deeds And Deeds of Trust

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V 1

See also Section 3.73 of Virtual Underwriter for details as to Correction Instruments.

Underwriting Manual Subtopic

In General

V 1

A correction deed, correction mortgage, or reformation deed is an instrument executed by the former grantor of an instrument that contains a certain defect or deficiency, or by said grantor's heirs, representatives, or assigns for the purpose of correcting or amending a mistake or defect contained in the instrument.

The location of the error or defect to be corrected may be either within the body of the instrument itself or in its acknowledgment. The nature of the error may consist of matters that:

  • Do not allow the instrument, though recorded, to impart constructive notice.
  • Do not properly define the property or the interest being conveyed.
  • May produce doubt or confusion as to the time of execution or the names of the parties.

The title examiner must be aware that the scope of utilization of a correction deed, correction mortgage, or reformation deed is extremely limited.

Any subsequent deed or mortgage under the guise of being a correction or reformation deed or mortgage, cannot purport to make a substantial change in the name of the grantee, change the size of the premises, alter the term or quality of the estate conveyed, or add a restriction or a condition. In no manner may the grantor, through the correction deed, correction mortgage, or reformation deed, intend to vacate, supersede, or replace the former instrument.

For any substantial change in the instrument to be effective, recorded evidence of the consent of the grantee is necessary.  The best evidence of the consent is the initials of the parties or a resigned document.

Usually, in the event of a mutual mistake in regard to the legal description of the property, and if the parties agree to its correction, it is practical for the grantee in the defective instrument to execute a new conveyance.

If you are asked to update a policy by virtue of a corrective deed or mortgage, you must check title to date, and if there are intervening equities or liens, show them as exceptions in Schedule B or dispose of them prior to issuance.  Remember, under the instructions for the T-3 endorsement, only changes are to be made to correct a set of facts existing at the policy date.  For any other reason, contact a Texas Underwriter.