By Jeff Lender
Just like homeowners, the owners of commercial properties need protection from title defects. If you own a business location, apartment building with more than 5 units, or any other type of commercial real estate, commercial title insurance can protect you from a range of title defects that may not show up on a title search. A standard title policy can prevent you from incurring financial losses due to:
-Undisclosed or Unknown Heirs
-Conflicting Wills or Claims of Ownership
-Fraud and Forgery in the Title Chain
-Undiscovered Liens
-Clerical Errors
-And more
Of course, a standard title policy can’t cover every type of title defect. Standard policies are designed to cover some of the most common scenarios that affect commercial property owners, but some owners may be at risk from other types of title defects. As a top title company serving New York and communities across the country, World Wide Land Transfer has some information about title insurance endorsements, you may want to consider adding to your standard commercial title policy.
This series of endorsements covers title defects related to zoning issues. In order for a business to operate, the land where it is located must be properly zoned for commercial use and, in some cases, for the specific type of business being operated on it. Even if a business had been operated there previously before you bought the property, you could still run afoul of zoning issues at any time, so this endorsement series can protect you if you receive notice of a zoning violation in the future.
These endorsements affect condominiums, planned unit developments, and manufactured housing units, respectively. Suppose your commercial land already contains one of these structures, or you plan to build them there. In that case, these endorsements can protect you from issues regarding assessments or from manufactured housing units not being considered part of the insured real estate.
Environmental protection liens can be a big problem for certain types of businesses, and they can severely impact the value of a commercial property. An 8 series endorsement can offer protection from losses or damage related to covered environmental liens.
This is one of the most wide-ranging commercial title policy endorsements, making it one that any commercial real estate owner should consider. In fact, it is sometimes referred to as the comprehensive endorsement because of all the coverage it provides.
A 9 series endorsement can protect from restrictive land use covenants, as well as encroachments on the ensured property and encroachments onto neighboring properties. If an encroachment or land use issue is discovered, your 9 series endorsement can cover the cost of resolving it.
Some properties have access issues, which usually means they do not have access to public roads without crossing an adjoining property. In many cases, the access issue is not discovered until a neighboring property builds new structures or a municipality makes changes to surrounding roads, intersections, or sidewalks.
The 17 series of endorsements is designed to cover the expenses associated with resolving access issues so you can continue operating your business no matter what adjoining property owners or municipalities decide to build.
The subject of title insurance endorsements for commercial real estate covers so much ground that it’s difficult to include every possible endorsement in a single blog post. If you are the owner of any property seeking a commercial real estate title company, it’s best to speak with an experienced title agent as soon as possible before a title defect is discovered.
World Wide Land Transfer has been providing title insurance for commercial real estate for more than 20 years, making us highly qualified to recommend policy endorsements that apply to your commercial location. Get in touch with our team today with all your questions about commercial real estate or to inquire about escrow services, title insurance for homeowners, and more.
World Wide Land Transfer is a service-oriented PA title company with offices in Philadelphia, New York, and Washington, D.C. With a record of going above and beyond, we are trusted to close everything from complex commercial transactions to residential refinance and purchase transactions.
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