- February 10, 2011
- All Issuing Offices
- Use of Prior Title Evidence (Starter) for Commercial Transactions
Title insurance agents and title insurers commonly use prior title evidence (starters) or prior searches/title policies or other forms to begin a title search, and then update that search, check applicable names, and verify payment of taxes, assessments, and other applicable charges.
YOU MAY BEGIN YOUR SEARCH AND EXAMINATION WITH ACCEPTABLE PRIOR TITLE EVIDENCE, SUBJECT TO THE CONDITIONS BELOW, UNLESS YOU HAVE REASON TO BELIEVE THAT THE PRIOR TITLE EVIDENCE FROM ANOTHER COMPANY IS INCOMPLETE OR OTHERWISE MAY NOT ACCURATELY REFLECT THE STATE OF TITLE AS OF ITS EFFECTIVE DATE. IF YOU BELIEVE THAT THE PRIOR TITLE EVIDENCE OR SOURCE OF THE INFORMATION MAY BE UNRELIABLE (SUCH AS A FAILED TITLE COMPANY) OR INCOMPLETE, YOU MAY NOT RELY UPON IT AS A STARTER.
Subject to any local regulation or law (such as in Arkansas, Louisiana, North Dakota, Massachusetts, Missouri, Oklahoma, and South Dakota), establishing other search or examination standards or requiring use of a title plant by a licensed title company or abstractor, or requiring an attorney's opinion, you may use prior title evidence as follows:
- You may use a prior Owner's Policy with specific Schedule B title exceptions to begin your search.
- You may use a prior Loan Policy with specific Schedule B title exceptions to begin your search for issuance of a new Loan Policy. If you will issue a new Owner's Policy based on a prior Loan Policy as a starter, you should begin your search one year before the conveyance date to the prior owner or one year prior to the prior Loan Policy, whichever search is longer in time.
- You may use a prior Commitment for Title Insurance from a prior transaction (i.e., for a prior loan or sale, but not the current loan or sale) with specific title exceptions to begin your search, if approved by a senior underwriter as to form of the new commitment. You must examine title from the last insured transaction or vesting of title, whichever is earlier. You should not assume that requirements of the commitment were satisfied, without additional sufficient evidence.
- You may not use a commercial short form (a form not containing specific title exceptions) as a starter for an Owner's or a Loan Policy that will have specific title exceptions.
- You may not use a Foreclosure Policy or Guarantee (such as a Trustee's Sale Guarantee or a Foreclosure Guarantee) as a starter.
- If local statutory and regulatory requirements require a more stringent standard (e.g., longer minimum period for examination) or an additional requirement (e.g., abstract, attorney certification, countersignature), you must comply with that standard or requirement.
- All starter information must be properly obtained in accordance with applicable law.
- If the new policy will exceed your authority to issue without underwriter approval, you must secure overlimits approval to issue and to rely upon the starter from our underwriting personnel.
You should do your regular search of names for parties who are in the chain from the time of commencement of your examination, including those parties shown as vested in title by the starter.
You should do your regular search for taxes, assessments and other charges.
If a significant gap between the current date and the date of the available title records exists in the applicable county, you should also search that approximate gap time behind the date of the starter.
You must (1) secure copies of all instruments referred to in the prior title evidence, (2) secure the instrument vesting title in the current owner, (3) review all such instruments and write your own exceptions in your own words after such review (unless you have a prior Stewart policy).
You may continue to rely upon our previously issued guidelines for searches, for other forms, available in your jurisdiction, such as commercial short form loan policies, foreclosure policies and guarantees, so long as those search requirements comply with local statutory and regulatory requirements. Otherwise, you should secure a reasonable and customary search in the jurisdiction that is satisfactory to determine title and any defects, liens or encumbrances (including restrictions, minerals, and easements, unless an appropriate exception is taken).
You must have possession of a copy of the prior policy in order to use it as a starter and keep that copy in the archival file.
If you have questions relating to this bulletin, please contact Stewart Legal Services or your local underwriting personnel.
For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.
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.
- Bulletins Replaced:
- SLS2010006 This bulletin has been replaced.
- SLS2010028 This bulletin has been replaced.
- Related Bulletins:
- SLS2009004 Use of Starters for Title Search [Revised 3-23-09]
- SLS2009006 Searches, Starters, Subordinations, Satisfactions and Surveys
- Underwriting Manual:
- Exceptions Manual: