A title insurer's binding offer to issue a title policy on stated terms, listing what it will insure, what it requires before closing, and what it will not cover.
The longer version
A title commitment is the title insurer's written promise to issue a policy once its stated requirements are met. It is not the policy itself. It describes the policy that will be issued, lists what has to happen before it can be, and lists what the policy will not cover. Everything a lender negotiates about title happens between the commitment and the closing.
It is organized in schedules. Schedule A identifies the proposed insured, the policy amount, the vested owner, and the legal description. Schedule B-I lists the requirements: the documents to be recorded, the payoffs, the releases, and the affidavits the insurer needs. Schedule B-II lists the exceptions, the recorded easements, restrictions, encroachments, and standard survey and rights-of-parties exceptions the policy will exclude.
The lender's work is mostly in B-II. Each exception is read against the survey and the loan's needs, and the question for each one is whether it can be deleted, insured over with an endorsement, or accepted. The standard survey exception usually comes off once a current ALTA survey is delivered. Easements that run under a building do not come off, and they are the ones to read twice.
A commitment is dated, and it is only as current as its effective date. Title is brought down to the closing date before funding, and the marked-up commitment or pro forma policy signed at closing is what the lender actually relies on. Matching that final version against the issued policy weeks later is a post-closing item that gets skipped more often than it should.
In Prodeal
Each Schedule B item can run as its own checklist line with a responsible party, usually the title company or lender's counsel, so exception clearing is visible instead of buried in email.
Common questions
- What is a title commitment in real estate?
- A title insurer's written commitment to issue a policy once listed requirements are met. It shows who holds title, what must be recorded or released before closing, and which recorded matters the policy will exclude. In a commercial loan it is the working document for every title negotiation.
- What is the difference between a title commitment and a title policy?
- The commitment is the promise and the policy is the coverage. The commitment comes first and changes as requirements are met and exceptions are negotiated. The policy is issued after closing and recording, and should match the final marked-up commitment signed at closing.
- Who pays for the title commitment?
- It follows local custom and the contract. In commercial lending the borrower usually pays for the lender's policy, and who pays for the owner's policy is set by the purchase agreement and the practice in that county.
- How long is a title commitment good for?
- For the period stated on the commitment, which varies by underwriter and state. In practice title is brought down to the closing date regardless, so an older commitment is updated rather than relied on.
- What are Schedule B exceptions on a title commitment?
- Schedule B-I lists the requirements to be met before the policy issues. Schedule B-II lists the matters the policy will not cover, such as easements and restrictions. A lender reviews B-II against the survey and decides which exceptions to delete, insure over or accept.
- The commercial loan closing checklistWhat goes on the list and who owns each line.
- The commercial loan closing timelineThe stages and what sets the pace.
- What lenders check in a closing binderFour reviewers, four different reads.
- Due diligence softwareThe request list, the owners and the dates in one place.