The Benefits of Private Rights Endorsements

05/21/2024 05:00 AM Mark Goodman

In this article, we are going to describe the benefits of the private rights endorsements that can be used when underwriting title insurance.

Private Rights Endorsements

These endorsements protect the insured owner against financial loss caused by the enforcement of a private right in a covenant affecting the title at date of policy that (a) results in the invalidity, unenforceability or lack of priority of the lien of the insured mortgage, or (b) causes a loss of the insured's title acquired in satisfaction or partial satisfaction of the indebtedness.

"Private Right" is defined in the endorsement as: (i) a private charge or assessment; (ii) an option to purchase; (iii) a right of first refusal; or (iv) a right of prior approval of a future purchaser or occupant.

The ALTA 9.6.1 endorsement limits the coverage relating to a private charge or assessments to those due and payable at date of policy.

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