Q. How do we document that an owner has waived owners title insurance coverage?
Answer: Use the attached form.
(for your convenience you can get this and other forms by going to the “Resources” tab and click on “Forms”
NJSA 46:10A-3 provides
Whenever in connection with the making of a real estate purchase money mortgage loan upon a 1, 2, 3 or 4 family dwelling house for a term exceeding 2 years, the mortgagee requires the issuance of a mortgagee policy of title insurance, the company issuing the policy of title insurance shall prior to the disbursement of the mortgage funds cause the mortgagor to be advised in writing of the fact that a mortgagee title insurance policy is to be issued, the name or names of the insured under said policy, and of the face amount of such policy. Such notice shall also advise the mortgagor of his right and opportunity to obtain title insurance in his own favor if the same has not already been ordered or obtained.
It is wise to apply this to both residential and commercial transactions despite the language of the statute.
While the attached form does not address the opportunity to consult with an attorney, where the buyer is not represented by counsel, it is advisable to include a statement to that effect on the form. The following may be useful: “I have been advised that I should consult an attorney of my choosing in connection with my decision to decline owners title insurance and have chosen not to do so.”
As always, feel free to address any questions to a member of our staff.