Title Commitment
A title company's promise to issue a title insurance policy, listing the property's current ownership, the requirements to clear title, and any exceptions (liens, easements, restrictions) before closing.
A title commitment (or commitment for title insurance) is the document a title company issues before closing that spells out the terms under which it will issue a title insurance policy. It's the investor's and lender's roadmap to a clean closing — it reveals exactly what's wrong with the title and what must be fixed to get a clear policy.
The three schedules
Most commitments are organized into schedules:
- Schedule A — the basics: the proposed insured (you and your lender), the policy amount, the current legal owner, and the legal description.
- Schedule B-I (Requirements) — what must happen before the policy issues: pay off existing mortgages and liens, record the new deed of trust, obtain releases, satisfy taxes.
- Schedule B-II (Exceptions) — what the policy will not cover: recorded easements, restrictions, mineral rights, and standard exceptions. These are the items you accept or negotiate.
Why it matters in investor lending
Before a lender funds a DSCR, hard money, or fix-and-flip loan, it must confirm the property has marketable title and that its new lien will sit in the agreed lien position (usually first lien). The commitment is how that's verified. Hidden liens, an open mortgage, unpaid taxes, or a clouded chain of title can delay or kill a closing — the commitment surfaces them in time to cure.
A worked example
Investor under contract on a flip.
Title commitment reveals:
Schedule B-I: existing $90k mortgage must be paid off
+ a $4,200 mechanic's lien from a prior contractor
Schedule B-II: a utility easement along the rear lot line
Action: payoff + lien release ordered before closing;
easement reviewed and accepted (doesn't affect the rehab).
Clearing the requirements lets the deal close with the lender in first position.
How it's used in investor lending
Read the commitment carefully and early — Schedule B-II exceptions are easy to skim past but can affect value, use, or your exit. Order it as soon as you're under contract so there's time to cure title defects before your rate lock expires. A clean commitment is a precondition to funding; the actual title insurance policy issues at or after closing once the requirements are met.
This is general information, not legal advice.
Frequently asked questions
What's the difference between a title commitment and title insurance?
A title commitment is the title company's pre-closing promise to insure, listing the requirements to clear title and the exceptions it won't cover. Title insurance is the actual policy, issued at or after closing once those requirements are satisfied. The commitment is the roadmap; the policy is the protection.
What should I look for on a title commitment?
Focus on Schedule B-I (requirements you must satisfy, like paying off existing liens) and Schedule B-II (exceptions the policy won't cover, like easements and restrictions). Confirm the legal description and ownership in Schedule A, and make sure nothing in the exceptions harms your intended use, value, or exit strategy.
When should I order the title commitment?
As soon as you're under contract. Title defects — open mortgages, unpaid taxes, mechanic's liens, or chain-of-title problems — take time to cure. Ordering early gives you room to clear requirements before your rate lock expires and the loan needs to fund.