# Texas Title Insurance Forms and Endorsements

## Table of Contents
1. [Overview](#overview)
2. [Basic Manual Rate Policies](#basic-manual-rate-policies)
3. [Policy Jackets](#policy-jackets)
4. [Common Endorsements](#common-endorsements)
5. [Lender-Specific Requirements](#lender-specific-requirements)
6. [Form Selection Guide](#form-selection-guide)

## Overview

Texas title insurance is regulated by the Texas Department of Insurance (TDI). Rates and forms are promulgated—all title insurers use identical forms and charge identical premiums (Basic Premium Rate from the Basic Manual of Rules, Rates, and Forms).

**Key resources**:
- Texas Basic Manual: Official forms and rates
- TDI website: Current bulletins and rule changes
- Form effective dates: Always verify current version

## Basic Manual Rate Policies

### Owner's Policies

| Form | Name | Use |
|------|------|-----|
| **T-1** | Owner Policy of Title Insurance | Standard owner's policy for fee simple ownership |
| **T-1R** | Owner Policy (Residential) | Simplified owner's policy for 1-4 family residential |
| **T-2** | Mortgagee Policy | Lender's policy (see below) |
| **T-7** | Short Form Residential Loan Policy | Simplified lender policy for residential |

### T-1: Owner Policy of Title Insurance

**Covered risks** (Schedule A):
- Title vested other than as stated
- Defect, lien, or encumbrance on title
- Unmarketability of title
- Lack of legal access to and from the land

**Standard exceptions** (Schedule B):
1. Restrictive covenants (if any)
2. Standby fees, taxes, assessments (not yet due and payable)
3. Liens for labor or material (if construction within 90 days)
4. Discrepancies, conflicts, shortages, encroachments (survey matters)
5. Rights of parties in possession

**Conditions**:
- Policy insures as of Policy Date only
- Coverage continues after conveyance to specified successors
- Notice/claim procedures

### T-1R: Residential Owner Policy

Simplified policy for 1-4 family residential, including:
- Same covered risks as T-1
- Plain language format
- Automatic inflation coverage (10% per year, 5 years max)

### Lender's Policies

| Form | Name | Use |
|------|------|-----|
| **T-2** | Mortgagee Policy | Standard lender policy |
| **T-7** | Short Form Residential Loan Policy | Residential lender policy (1-4 family) |
| **T-2R** | Texas Residential Mortgagee Policy | ALTA-style residential lender policy |

### T-2: Mortgagee Policy

**Covered risks**:
- Same as owner's policy, plus:
- Invalidity or unenforceability of the lien
- Priority defects
- Lack of power to convey or create lien
- Mechanic's lien priority issues

**Amount**: Decreases as loan is paid down (unless endorsement purchased)

### T-7: Short Form Residential Loan Policy

- For 1-4 family residential loans
- Incorporates ALTA Loan Policy conditions by reference
- Simpler format than T-2

## Policy Jackets

### Commitment for Title Insurance (T-commit form)

**Schedule A**:
- Effective date and time
- Policy amounts (proposed)
- Proposed insured(s)
- Legal description
- Estate or interest
- Current title vesting

**Schedule B - Section I** (Requirements):
Items to be satisfied before policy will issue

**Schedule B - Section II** (Exceptions):
Exceptions that will appear in policy

**Schedule C**:
- Notice of prior policies
- Construction disclosure
- Survey disclosure
- Arbitration disclosure

**Schedule D**:
- Title company information
- Escrow officer
- Agent/underwriter relationship

### Policy Jacket Structure

**ALTA owner's jackets** (for T-1):
- Covered Risks
- Exclusions from Coverage
- Conditions

**Exclusions from Coverage** (standard):
1. Laws, regulations, ordinances (governmental)
2. Eminent domain (unless notice recorded)
3. Defects known to insured but not disclosed
4. Defects arising after Policy Date (that insured agreed to assume)
5. Creditor's rights
6. Matters relating to special assessments not yet due

## Common Endorsements

### Survey-Related Endorsements

| Form | Name | Purpose |
|------|------|---------|
| **T-19** | Comprehensive | Deletes survey exception; adds survey coverage |
| **T-19.1** | Survey Deletion | Deletes survey exception only |
| **T-19.2** | Minerals and Surface Damage | Protection against surface damage from minerals |
| **T-19.3** | Address | Insures street address |

**T-19 Requirements**:
- Current survey (within 90 days for construction)
- Survey certified to: buyer, lender, title company
- Must show improvements, easements, encroachments

### Access Endorsements

| Form | Name | Purpose |
|------|------|---------|
| **T-23** | Access | Insures legal access to public road |
| **T-23.1** | Access and Entry | Insures access + right to enter from road |

### Lender Endorsements

| Form | Name | Purpose |
|------|------|---------|
| **T-28** | Mortgage Modification | For loan modifications |
| **T-30** | Waiver of Arbitration | Waives arbitration for lender disputes |
| **T-31** | Supplemental Coverage | Additional lender protections |
| **T-33** | Revolving Credit | For HELOCs and revolving facilities |
| **T-36** | ALTA endorsement coverage | Incorporates specified ALTA endorsements |
| **T-38** | Variable Rate | For adjustable-rate mortgages |
| **T-42** | Negative Amortization | For neg-am loans |

### Condominium/PUD Endorsements

| Form | Name | Purpose |
|------|------|---------|
| **T-17** | Planned Unit Development (Owner) | For PUD transactions |
| **T-17.1** | PUD (Lender) | Lender version |
| **T-24** | Condominium (Owner) | For condo transactions |
| **T-24.1** | Condominium (Lender) | Lender version |

### Other Common Endorsements

| Form | Name | Purpose |
|------|------|---------|
| **T-15** | Non-Imputation (Partial) | Protects buyer from seller's knowledge |
| **T-16** | Non-Imputation (Full) | Broader non-imputation coverage |
| **T-20** | Deletion of Arbitration | Owner's arbitration waiver |
| **T-25** | Same as Survey | For minor description variations |
| **T-34** | Identified Restrictions | Schedules specific restrictions |
| **T-39** | Policy Authentication | For electronic policies |
| **T-43** | Commercial Mortgage Modification | Commercial loan mods |
| **T-44** | First Loss | Commercial first-loss coverage |

## Lender-Specific Requirements

### Standard Lender Package (Residential)

Most residential lenders require:
- T-2 or T-7 policy
- T-19 endorsement (survey coverage)
- T-19.2 endorsement (mineral/surface damage)
- T-30 endorsement (arbitration waiver)
- T-38 endorsement (if variable rate)

### Commercial Lender Package

Typical commercial requirements:
- T-2 policy
- T-19 endorsement
- T-23 or T-23.1 (access)
- T-30 (arbitration waiver)
- T-43 (if modification contemplated)
- T-44 (first loss, if applicable)
- Zoning report or endorsement
- UCC search

### Fannie Mae/Freddie Mac Requirements

For loans to be sold:
- Policy must comply with agency guidelines
- Specific endorsement requirements per loan type
- Survey requirements vary by property type
- MERS endorsement if applicable

### ALTA Policy Requirements

Some national lenders require ALTA-form policies:
- T-36 endorsement incorporates ALTA coverages
- Check specific lender requirements
- May require ALTA 9 (restrictions), ALTA 17 (access), etc.

## Form Selection Guide

### Residential Purchase (1-4 Family)

**Owner**: T-1R
**Lender**: T-7
**Standard endorsements**: T-19, T-19.2, T-30, T-38 (if ARM)

### Residential Refinance

**Lender only**: T-7
**Endorsements**: T-19, T-19.2, T-30, T-28 (if mod), T-38 (if ARM)

### Commercial Purchase

**Owner**: T-1
**Lender**: T-2
**Endorsements**: T-19, T-23, T-30, T-44 (if requested)

### Condominium

**Owner**: T-1R + T-24
**Lender**: T-7 + T-24.1
**Standard endorsements plus condo-specific**

### PUD (Planned Unit Development)

**Owner**: T-1R + T-17
**Lender**: T-7 + T-17.1
**Standard endorsements plus PUD-specific**

### Construction Loan

**Lender**: T-2 with construction disbursement endorsement
**Special requirements**:
- Mechanic's lien coverage
- Pending disbursement endorsements
- Survey updates during construction

## Premium Calculations

### Basic Premium

Calculated from Basic Manual rate schedule based on:
- Policy amount
- Transaction type (sale, refinance, construction)
- Prior policy credits (if refinance within time period)

### Endorsement Premiums

- Fixed fee per endorsement (varies by type)
- Some endorsements included in base premium
- Check current rate schedule

### Simultaneous Issue Discount

When issuing owner's and lender's policies simultaneously:
- Lender's policy premium significantly reduced
- Must close at same time

### Reissue/Refinance Credits

- Credit for prior policy within specified period
- Requires proof of prior policy
- Credit percentage varies by time elapsed