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What this task is

This task collects the preliminary title report (or equivalent title commitment) for the subject property on the loan. The report outlines:
  • Current vested owners,
  • All recorded liens, mortgages, and encumbrances, and
  • Any easements, restrictions, or title exceptions relevant to the property.
This document is the foundation for evaluating whether the lender can obtain the required lien position and whether there are title-related issues that must be cleared before closing.

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When this task is required

This task is required when:
  • A subject property has been identified for the loan, and
  • A title insurance provider has not yet issued or provided a preliminary report, or the existing documentation is incomplete or outdated.
It applies broadly across:
  • Purchase transactions, where title must move from seller to borrower.
  • Refinance transactions, where the lender must confirm the existing liens and ownership prior to issuing new financing.

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Why this task is required

Lenders must ensure:
  • The borrower (or other approved parties) will hold clear and insurable title to the property.
  • The lender’s loan will be recorded in the intended lien position (usually first-lien).
  • There are no unresolved title defects or undisclosed liens that could:
    • Impair marketability,
    • Increase risk of loss, or
    • Violate investor or insurer requirements.
The preliminary title report helps underwriters and closing teams:
  • Identify existing mortgages, judgments, tax liens, or other encumbrances that must be paid or otherwise addressed.
  • Understand easements or restrictions that could affect property value or use.
  • Confirm that vesting and legal description match the information in the loan file and closing documents.
Without a thorough title review, the lender cannot be confident that it will receive the protection and priority required to fund the loan.

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Documents needed to resolve this task

To satisfy this task, provide:
  • A preliminary title report or title commitment for the subject property:
    • Issued by a licensed title insurance company or its agent.
    • Showing legal description, current ownership, all recorded liens, encumbrances, easements, and exceptions.
  • If available, any supporting documents or prior policies that clarify complex title histories or prior corrective actions.
These materials allow the lender and title/closing partners to clear any issues and ensure that final closing documents reflect accurate vesting and lien position.