A title commitment in real estate is the title insurance company’s written promise to issue a policy on specific terms once the sale closes and certain conditions are met. It arrives before closing and does three jobs at once: it reports what the title search turned up in the public records, lists what has to be cleared before the policy will issue, and spells out what the policy won’t cover. It is not insurance yet. The actual policy comes after closing, and only if the requirements inside the commitment have been satisfied.
Most commitments in the United States follow the ALTA Commitment for Title Insurance (2021), a standardized form with a set of conditions, a Schedule A, and a Schedule B split into Part I (requirements) and Part II (exceptions). Some states tweak the naming, but the structure is the same.
What Schedule A Tells You
Schedule A is the fact sheet. It shows the commitment’s effective date, the proposed insured parties, the proposed amount of insurance, the type of estate (usually fee simple), the legal description of the property, and the current record owner. The owner’s policy amount typically matches the purchase price; the lender’s policy matches the loan amount.
Read Schedule A against your purchase contract line by line. The legal description should match the property you’re buying. The record owner should match the seller. Errors here delay closings.
The effective date deserves its own look. The title search covers records only through that date, so anything recorded afterward falls outside what the commitment addresses. That window has a name and its own treatment, covered further down.
Schedule B, Part I: What Must Be Cleared
Part I is a to-do list. Until every item is resolved, the title company will not issue the policy. Common requirements include:
- Paying off the seller’s existing mortgage and releasing the lien at or before closing.
- Clearing unpaid tax liens, court judgments, and contractor liens against the property.
- A seller affidavit confirming no unrecorded liens, no unpaid recent construction work, and that the seller is not a foreign person under FIRPTA.
- Formal releases of old easements, deed restrictions, or other clouds on title.
- Proper recording of the new deed and mortgage.
Most Part I items fall on the seller. If the seller cannot clear a required item, the typical purchase contract lets the buyer either terminate the deal or waive the defect and close anyway.
Schedule B, Part II: What the Policy Won’t Cover
Part II lists exceptions. Each one is a risk the title company found and refuses to insure against. If a dispute later arises over something listed here, the policy will not pay.
Exceptions come in two groups. Standard exceptions appear on almost every commitment:
- Unrecorded rights of parties in possession, meaning someone on the property whose claim isn’t in the public records.
- Unrecorded easements, such as a neighbor’s longstanding use of a path that was never documented.
- Survey matters, including encroachments and boundary problems that only a physical survey would catch.
- Unrecorded mechanic’s liens from contractors who haven’t been paid but haven’t yet filed.
- Certain tax and assessment liens that don’t appear in the standard recording system.
Special exceptions are specific to your property. A utility easement across the backyard, a restrictive covenant limiting what you can build, a neighbor’s fence that crosses the line: these come straight from the examiner’s findings in the records for your parcel.
This is the section most buyers skim and later regret. If a covenant blocks a planned addition or an easement sits where you wanted a pool, the policy won’t pay, because the commitment told you about it in advance.
Standard vs. Extended Coverage
A standard policy keeps all five standard exceptions. An extended policy removes most or all of them. The title company will usually require a current survey before deleting the survey exception, and the premium is higher. Those standard exceptions cover some of the most common real-world title problems, so extended coverage, or a specific endorsement addressing a single exception, is worth asking about when something on the list concerns you.
Reviewing the Commitment and Raising Objections
Your purchase contract sets a deadline for objecting to anything in the commitment. Objection periods are often short, sometimes as few as five days from receipt. Miss it and you can waive your right to object, which leaves you accepting the title as-is or walking away.
When you find a problem, send a written title objection letter to the seller or seller’s attorney identifying each item you want resolved. Typical objections include:
- Liens the seller should pay off, including back taxes, old satisfied mortgages that were never released, and judgment liens.
- Easements that interfere with your intended use of the property.
- Restrictive covenants that weren’t disclosed during the sale.
Not every exception can be removed. A utility easement serving active infrastructure, for example, isn’t going anywhere. But many exceptions can be handled through an endorsement, which adds coverage for a specific risk the base policy would otherwise exclude. If the title company won’t delete the exception, it may insure over it with an endorsement for an added fee.
The Gap Period
The gap period is the window between the commitment’s effective date and the moment your deed is recorded. During that window, a lien, judgment, or other claim can land in the public records that the title search didn’t catch, because it hadn’t happened yet.
The risk is real. A seller’s creditor could file a judgment lien after the search. A contractor could file a mechanic’s lien in the same window. Many modern policies include gap coverage; if yours doesn’t, you can request a gap endorsement for a relatively small cost. Ask the title company directly whether claims filed between the commitment date and recording are covered.
Marketable Title vs. Insurable Title
These two terms get used interchangeably and shouldn’t be. A marketable title has a clean chain of ownership with no unresolved defects. An insurable title can still have known defects; the title company has simply agreed to insure against them causing you a loss. The defects remain attached to the property.
Most purchase contracts require the seller to deliver marketable title. If your contract settles for insurable title instead, the seller can leave known defects in place as long as the insurer will cover them. That looks fine today, but when you later sell, the next buyer’s title company may not be willing to insure over the same issues, and you can end up cleaning up what the original seller left behind.
What It All Costs
Title insurance is a one-time premium paid at closing, with no renewal. A lender’s policy typically runs between 0.1% and 1.0% of the purchase price. An owner’s policy averages at least 0.4% of the purchase price. On a $400,000 home, that works out to roughly $400 to $4,000 for the lender’s policy and $1,600 or more for the owner’s policy.
Separate charges for the title search and examination usually appear on the closing disclosure, sometimes bundled with the premium and sometimes itemized. Rates vary by state. Some states regulate premiums, so every company charges the same; others let the market set prices, which makes shopping worthwhile. The Consumer Financial Protection Bureau notes that borrowers who compare providers could save as much as $500 on title services. You have the right to choose your own title company regardless of who your lender or agent recommends.
Two policies can be issued from the same commitment: a lender’s policy covering the lender’s loan balance, and an owner’s policy covering your financial interest. Lenders generally require the lender’s policy. The owner’s policy is optional, but skipping it means you alone bear any title defect that surfaces after closing. Who pays for the owner’s policy varies by region and is often negotiable in the contract; the lender’s policy premium is almost always on the buyer.
From Commitment to Policy
A commitment doesn’t last forever. The ALTA standard form sets a default expiration of six months from the effective date, and individual commitments may be shorter. If closing is delayed past that window, the title company has to update and reissue the commitment, usually with a fresh search for the added time.
Once every Part I requirement is satisfied and the deal closes, the title company issues the policy. The policy reflects the final state of the title after those requirements have been met, but the Part II exceptions carry over. Anything you didn’t negotiate out of the commitment will stay out of the final coverage, which is the whole reason to read Schedule B carefully while there is still time to push back.