Long Form Loan Policy - Full Search Required (AC Nov 2024)
Only a full search, covering a minimum of 40 years, provides the full scope of possible title defects, potential claims, recorded liens, easements, and other title matters needed for the Long Form Policy. The policy must cite all unique title exceptions, conditions, and restrictions. A full search is conducted for purchase transactions per usual and either the Long Form Policy or short form policy can be issued if the property and insured qualify for the short form policy. Generally, refinance transactions only require a two-owner search, but really, it depends. If the intention is to issue a short form policy with a short search, not all properties or borrowers qualify for such and a Long search for a Long Form Policy is required.
The type of transaction has bearing on what type of policy to issue, AND that ties us to the type of search necessary to issue a Long Form Policy.
While all exceptions on Schedule B-I must be listed on the Long Form Policy, this is not required on the short form. For example, a short form policy can only be issued on 1-4 family residences and condominiums. A short form cannot be used on loans for construction nor for a loan on raw land. It cannot be used on commercial properties. These types of transactions often involve nonstandard provisions and require a full search. This leads us to the Long Form Policy, which requires all specific exceptions and may be issued to any insured party and property.
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Please contact underwriting counsels at VAUnderwriting@OldRepublicTitle.com for specific questions regarding the Old Republic policies or forms.