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  • Blue Pointe Title

How to Get Commercial Title Insurance

Updated: Nov 8, 2023


a woman going through papers that are clipped together at her desk

Investing in commercial real estate requires a lot of due diligence. Digging through mounds of paperwork is necessary just to confirm that there is a clear owner — and that the owner matches the seller.


While commercial real estate transactions may be quite a bit more complex than those involving residential property, they still follow many of the same general steps, including the title search.


And when it comes to title insurance, there is no exception. Investors in commercial property want to make sure they are buying real estate that is free of any title issues or encumbrances before the sale is final.

What is Title Insurance?

Title insurance protects against things that happen before the property changes hands. As the title search tries to uncover issues, sometimes things slip through. So, as a means to protect against loss, a policy may be purchased to cover the new owner and another to cover the lender. Keep in mind that this covers old title issues — any new title issues will not be covered.


Commercial title insurance is an insurance policy that protects the new owner or lender against any financial losses that result from the commercial property’s title defects, such as:


  • Erroneously recorded public records

  • Erroneous property surveys

  • Encroachments

  • Liens or judgments attached to the title

  • Title fraud or forgery

  • Bankruptcies or pending litigation


Should any of these things, or the like, appear after you become the rightful title holder, then your title insurance policy would protect you by compensating you up to the property’s purchase price. A lender would be compensated enough to cover the remaining principal of the mortgage.


How To Get Commercial Title Insurance

You know the benefits of commercial title insurance, but how do you get it?


Working with your local title company is the easiest way to secure a title insurance policy. Title agents will do an in-depth title search to make sure the title is clear or will work to have any title issues cleared as a condition of the closing. A title commitment will be issued stating the details of the search results.


At that time a title insurance policy will be offered. The policy will be presented to you by your title company, but it will usually be backed by one of the four main title insurance underwriters throughout the United States.


Commercial Title Insurance: Things to Know

Most investors who are new to commercial title insurance have a few questions. Below are a few additional tidbits that can help you with your purchase of commercial title insurance so that your interest is protected.


  • Commercial title insurance is not usually required, but due to the complex nature of these transactions, it is highly recommended.

  • Lenders will almost always require you to purchase a lender’s title policy. Note that this will not protect you as the owner.

  • Each policy is paid for at the closing with no future premium payments needing to be made.

  • Your commercial title insurance policy will protect you as long as you have an interest in the property.


If you are thinking about saving money by forgoing commercial title insurance, you may want to reconsider. Although not everyone will deal with claims against their property, it only takes one to have a devastating impact.


Learn More About Commercial Title Insurance

Still have questions about commercial title insurance? Ready to purchase commercial property and need commercial title insurance? The title experts at Blue Pointe Title Agency can help.


Contact us today at 517-258-1511.

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