Guaranty Clause in Preliminary Report

Need of Guaranty clause in preliminary report

When a property is being sold or bought the guaranty of the title of the property s to be taken by someone. When the preliminary report is submitted regarding the investigation carried out by the insurer. This investigation is made by checking all the public records in association with the land or the property. This will include the records of the times when the property was not into any known hands as well as the most recent records.

The use of this preliminary report is to make sure that the buyer is not cheated upon b the seller in any way. The main problem that may be faced by the buyer is that of title defect or the property being in mortgaged against any other loan or if there is a lien against the property.

The preliminary investigation is for the benefit of the buyer who must not suffer losses due to any defects in the title which may lead to a problem for the buyer and also a case of double loss. Firstly the loss of money that the buyer will sustain due to the loss of the property secondly the buyer will have fight the court case in which there is a lot of money that is involved. This is to be avoided at all costs and if there is an insurer involved it is always better to investigate the history of the property to ensure a hassle free ownership to the buyer.

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Guaranty clause in preliminary report.

_________ Title Insurance Company of _________ here certifies to the applicant it has examined the title to land, namely: _________, and finds title in _________[e.g., seller], subject only to the following estates, liens, defects and questions which, together with any others which may be found in continuing the search, are to be excepted in the guaranty which it will issue in the above amount when the title is properly closed and satisfactorily reported, unless documentary evidence of their removal be submitted which shall be satisfactory to this company:

1. Statutory and municipal requirements relating to land and buildings.

2. Liability, if any, to mechanics’ liens for work done or materials supplied, if any.

3. Rights of tenants and occupants, if any.
Mortgages
4. _________
Easements
5. _________
Restrictions
6. _________
Tax Search
7. ORDERED Yes _________ No _________

Such municipal liens as may attach subsequent to date of above-described tax search.
Unconfirmed
8. ORDERED Yes _________ No _________
Assessment

Search

Inspection and Survey
9. Such objection to title, if any, as may result from facts which a survey and inspection would disclose to be advised.