Title Insurance Rate/Rule Changes Go Into Effect

April 8, 2018, the Sixth Revision of the TIRSA Title Insurance Rate Manual for New York State went into effect.

This sixth revision is intended to clarify and better organize the rules as well as update some rules, mostly for commercial transactions.

1] The following sections have been eliminated:

• Section 17-Mortgage Assumption
• Section 20-Bulk Fee, Leasehold
• Section 21- “Limited Liability” Mortgage Coverage
• Section 22- Affirmative Covenant Insurance

2] Part I-Definitions and Rules

• Section 1 (New) - Definitions have been added to clarify particular terms used within the rules and consolidate these terms into one place.
• Section 11 (New) - Mortgages insured upon acquisition of property when an Owner’s Policy covering ALL of the mortgage property is NOT simultaneously issued.
  This covers both purchase loans and construction loans issued at the time of land acquisition. It provides for unreduced rates.
• Section 15 (New) - Collateral Mortgages
  Provides for the issuance of simultaneous Loan Policies covering different properties securing a single indebtedness.
• Section 27 - Endorsements
  Formerly Section 25, adds the New York City Development Rights Endorsement and a New Increase in Amount of Insurance Endorsement to the list of Special Risk Endorsements.
  The base charge for endorsements not listed as Special Risk Endorsements changes from $25.00 to $50.00.
• Section 2 - Rules
  Formerly Section 1, the new subsection 2(k) regarding survey exceptions expressly permits elimination of changes since the date of the survey for commercial properties.
• Section 3 - Zones
  Formerly Section 2, rate Zones remain the same as do the basic rates in each Zone. This section now clarifies which searches are included in the Zone 2 premium.
• Section 5 - Minimum Insurance: Owner’s Policy-Additional Insurance
  Includes a provision of an Increase in Amount of Insurance Endorsement allowing for the amount of insurance in a then-existing Owner's Policy to be increased without changing the date of policy. The rate charged is the applicable build-up rate at the date of issuance of the endorsement.
• Section 9 - Construction Mortgage Insurance
  This reworks former Section 12 with changes in the details regarding modifications to permanent loans and simultaneous issuance with an Owner’s Policy. The section retains the $200.00 charge for each continuation (advancement report) beyond five, while clarifying that additional continuations shall be charged for additional tax lot searches if the tax lot is subdivided in the course of construction. Provision is also made for reduced rate modification to a permanent loan at a reduced rate for certain no consideration transfers.
• Section 12 - Refinance and Subordinate Mortgage
  Incorporates former Section14 and is expanded to include construction mortgages.
• Section 13 - Mortgage Modification
  Formerly Section 16, this provides that the mortgage modification rate can be applied even if the mortgage is more than ten years old. This brings the modification rate in line with the refinance rate.
• Section 17 - Owners Policy to Foreclosing Lender
  Formerly Section 15, this deletes the five-year limit on the age of the loan policy in order to qualify for the discounted “mortgage foreclosure” rate.
• Section 18 - Entity Purchase and Non-Imputation
  Formerly Section 30, this section provides for the issuance of an Owner’s Policy in the context of non-imputation and has been completely revised with the addition of ALTA forms of non-imputation endorsement, one for a full equity transfer and one for a partial equity transfer.
• Section 19 - Mezzanine Financing Insurance
  Formerly Section 35, this allows for more flexibility in the minimum amount of insurance in an Owner’s Policy that is being issued simultaneously with a mezzanine endorsement. The Owner’s Policy may be issued in the amount of the mezzanine loan even if the loan amount is less than full value of the property.

Title insurance rates used by Vanguard Research & Title Services, Inc. are based on the "Title Insurance Rate Manual for New York State" as provided by the Title Insurance Rate Service Association, Inc. (TIRSA)

The Sixth Revision of the manual became effective April 8, 2018 and is available for download here.