Understanding Title Commitments: What Every Agent Should Know

Category: For Agents Excerpt: Real estate agents who understand title commitments provide better service to clients. Learn how to read and explain these critical documents.

---

In the fast-paced, high-stakes world of DMV real estate, success hinges on efficiency, expertise, and the ability to anticipate and resolve problems before they derail a closing. For real estate agents serving clients in Washington D.C., Maryland, and Virginia, few documents are as critical—or as frequently misunderstood—as the Title Commitment.

A title commitment is not just a piece of paperwork; it is the promise of clear ownership and the foundation upon which the entire transaction rests. Agents who master the art of understanding title commitments don't just facilitate smoother closings; they become invaluable advocates for their clients, providing superior service and mitigating risk.

At Pruitt Title, a leading woman-owned title insurance company serving the DMV, we believe in empowering our partners. Our team, led by experts like Will Rapuano, works daily with agents across the region to demystify complex title issues. This comprehensive guide will walk you through the structure, purpose, and key components of the title commitment, ensuring you can read, explain, and act upon this essential document with confidence.

---

The Role of the Title Commitment in the DMV Real Estate Process

Before diving into the specifics of understanding title commitments, it’s crucial to define their purpose.

When a property goes under contract, the buyer’s lender (if applicable) and the buyer themselves require assurance that the seller legally owns the property and that no hidden claims or liens will surface after closing. This assurance is provided through title insurance.

The title commitment is essentially a preliminary report—a promise from the title insurer (often underwritten by major companies like First American Title Insurance Company) to issue a final title insurance policy after closing, provided certain requirements are met.

Why Agents Must Be Proficient

For the real estate agent, the title commitment is the central risk assessment tool. It is delivered early in the contract period, offering a limited window—typically 10 to 15 days, depending on the contract—to review, object to, and resolve any issues found.

A failure to properly review the commitment can lead to:

1. Delayed Closings: Unforeseen liens or undisclosed heirs can halt the process entirely.
2. Client Liability: Buyers may inherit problems that could have been resolved pre-closing.
3. Contract Disputes: If the commitment reveals issues that violate contract terms, the transaction may fall apart.

By proactively understanding title commitments, you position yourself as a true professional, safeguarding your client’s investment and reputation.

---

Deconstructing the Document: The Four Schedules

While the exact formatting may vary slightly between states in the DMV (DC, MD, VA), all title commitments adhere to a standard structure, divided into four critical sections, known as Schedules A, B-I, B-II, and C (though sometimes C is incorporated into B-I).

Schedule A: The Foundation of the Transaction

Schedule A is the "who, what, and where" of the commitment. It must be reviewed immediately for accuracy.

Agent Action Item: If Schedule A contains errors regarding names or the legal description, contact Pruitt Title immediately. These are administrative fixes that must be corrected before closing documents can be drafted.

Schedule B-I: Requirements to Be Met

Schedule B-I outlines the specific actions or conditions that must be satisfied before Pruitt Title can issue the final insurance policy. These are the "to-do list" items for the seller, buyer, and closing team.

Common Requirements in Schedule B-I:

1. Execution of Documents: The proper execution and recording of the deed, mortgage/deed of trust, and other closing documents.
2. Payment of Consideration: Proof that the purchase funds have been disbursed.
3. Payment of Liens: Requirements to pay off and obtain releases for existing mortgages, Deeds of Trust, home equity lines of credit (HELOCs), and any judgment liens (e.g., tax liens, child support judgments).
4. Proof of Authority: If the seller is an entity (LLC, corporation, trust), the title company requires documentation proving the signatory has the authority to sell the property.
5. Marital Status: Verification of marital status, often requiring a spouse to sign off on the deed even if they aren't on the title, depending on state law (especially relevant in Maryland and Virginia).

Agent Action Item: Review Schedule B-I with your client and the seller's agent. If a requirement involves obtaining a release (like a payoff for an old mortgage), ensure the seller’s side is actively working to secure the necessary documentation. Delays in obtaining payoffs are a major cause of closing postponements.

Schedule B-II: Exceptions to Coverage

This is arguably the most critical section for the buyer's agent to understand. Schedule B-II lists the matters that the title insurance policy will not cover. These are the risks that the buyer will inherit.

Understanding title commitments hinges on a thorough review of these exceptions. If the buyer accepts an exception, they cannot later file a claim against the title policy for that specific issue.

Standard Exceptions (Often Pre-Printed)

Most commitments include standard exceptions that are common to all policies unless specific steps are taken to remove them.

1. Parties in Possession: Claims by people occupying the property who are not the record owner (e.g., tenants, squatters).
2. Unrecorded Easements: Easements or claims not shown in the public records.
3. Survey Matters: Any issues that an accurate survey would reveal (e.g., encroachments, boundary disputes).
4. Taxes and Assessments Not Yet Due: Future taxes or assessments that have not yet become a lien.

Agent Action Item (Removing Standard Exceptions): In the DMV, it is common practice to try and remove or modify these standard exceptions, particularly the survey exception. This usually requires the buyer to obtain a current survey or affidavit. Discuss with Pruitt Title which exceptions can be negotiated off the final policy.

Specific Exceptions (The Red Flags)

These exceptions are unique to the property being searched and are the result of the title examiner’s work. They represent recorded documents that affect the use or ownership of the land.

• Covenants, Conditions, and Restrictions (CC&Rs): Documents recorded by the original developer governing how the property can be used (e.g., height limitations, restrictions on fences, HOA rules).
• Existing Easements: Rights granted to others to use the property for a specific purpose (e.g., utility companies running lines, shared driveways).
• Prior Mortgages or Liens: If a lien is listed here, it means the title company has not yet received confirmation that it will be paid off at closing. This is a massive red flag and must be addressed immediately.
• Mechanic's Liens: Claims filed by contractors who were not paid for work on the property.

Practical Example (DMV Context): Imagine a property in Arlington, VA, where the commitment lists an easement for the County Water Authority running directly under the backyard. If the buyer plans to build a large deck, this easement could restrict or prevent construction. The agent must flag this exception and ensure the buyer understands the limitation before closing.

---

The Critical Review Period: Agent Responsibilities

Once you receive the title commitment from Pruitt Title, the clock starts ticking. Your contract likely specifies a short period for title review and objection.

1. The 3-Way Cross-Check

Effective understanding title commitments requires comparison against three documents:

1. The Sales Contract: Ensure the names, price, and property address match Schedule A.
2. The Deed (if available): Compare the legal description on the commitment to the deed provided by the seller.
3. The Survey/Plat (if available): Compare easements and boundary lines listed in Schedule B-II against the physical survey.

2. Identifying and Communicating "Curable" vs. "Incurable" Defects

When a title defect is found, it falls into one of two categories:

As the agent, your role is to present these issues clearly to your client. For incurable defects, the buyer must decide if the risk or limitation is acceptable.

3. The Importance of Payoff Letters

One of the most common closing delays in the DMV involves securing accurate and timely payoff letters.

Will Rapuano, a title expert at Pruitt Title, stresses the importance of proactive communication: "The moment the commitment reveals an existing lien—whether it's a first mortgage, a HELOC, or a judgment—the seller's agent must instruct their client to contact the lender immediately. We need official, dated payoff statements to ensure the closing funds clear the debt. Relying on old statements or verbal estimates is a recipe for disaster."

If Schedule B-I requires the payoff of a lien, ensure the seller's agent confirms they have ordered the payoff letter well in advance of closing.

---

Establishing Authority: Pruitt Title in the DMV Market

In the complex regulatory environment of D.C., Maryland, and Virginia, having a title partner who specializes in regional nuances is non-negotiable.

State-Specific Title Considerations

While the core structure of the title commitment is standard, the legal requirements for clearing title vary significantly:

• Maryland: Known for its complex property tax and assessment structures, requiring meticulous attention to municipal liens.
• Virginia: Uses Deeds of Trust instead of mortgages, and state law dictates specific requirements for spousal rights and homestead exemptions.
• Washington D.C.: Often involves leasehold estates and unique historical preservation covenants that must be clearly disclosed in the commitment.

Pruitt Title’s expertise, backed by reliable underwriters like First American Title Insurance Company, ensures that these regional differences are handled correctly, protecting your client regardless of whether they are buying a rowhouse in Georgetown, a suburban home in Fairfax, or a waterfront property in Annapolis.

What Pruitt Title Does Differently

We don't just process paperwork; we provide solutions. When you partner with Pruitt Title, you gain access to a dedicated team focused on proactive problem-solving:

• Early Detection: Our examiners work quickly to deliver the commitment so you have maximum time for review.
• Clear Communication: We translate complex legal jargon into actionable insights for you and your clients.
• Lien Resolution: We actively work with lenders, attorneys, and county recorders to clear difficult liens and resolve defects listed in Schedule B-I.

---

Conclusion: Mastering the Commitment for Client Success

Understanding title commitments transforms a real estate agent from a transaction facilitator into a trusted advisor. By diligently reviewing Schedules A, B-I, and B-II, you gain the power to identify risks, negotiate resolutions, and ensure your client receives the clear, marketable title they paid for.

In the competitive DMV market, expertise is your greatest asset. Let Pruitt Title be your partner in achieving seamless, successful closings. We are committed to providing the clarity and support necessary to navigate the complexities of title insurance, ensuring that every transaction you handle is secure and efficient.

---

Ready to Partner with the DMV’s Title Experts?

Don't leave your clients' most significant investment to chance. Whether you need a detailed explanation of a complex easement in Northern Virginia or swift resolution of a lien in D.C., the team at Pruitt Title is here to help.

Contact Pruitt Title today to discuss your next closing or to schedule a complimentary training session on understanding title commitments for your brokerage.

Pruitt Title: Clear Title. Confident Closing.