Does your Texas Title Commitment Insure Mineral Rights?
As of this year, a rule was passed allowing Texas title insurance companies to insure mineral rights on a residential property. The insurance comes in the form of a blanket policy and certain criteria must be met before issuing the T-19.2 aka Minerals and Surface Damage Endorsement.
Note that this is not an endorsement that will be automatically issued. In order for the owner or lender of the property to be insured, the endorsement will need to be requested directly with the Texas title company insuring the transaction.
There is still some uncertainty as to the pricing of the T-19.2 and if credits such as the R-8 refinance credit, apply, but the Texas Department of Insurance presumably will clear this up in the next few weeks.
For timing’s sake, it will be important to notify your Texas title company if this endorsement is going to be requested as soon as possible. Mineral right researches require more work than a normal title search and, thus, much more time. Some mineral right researches can take weeks depending on issues such as how far back the deed was taken out, were the minerals ever severed from the surface, were there any deaths, were the rights transferred, etc.? And once the research is completed, the information gathered concerning the mineral rights being insured by your Texas title policy will need to be reviewed by the appropriate underwriter or attorney. Only upon their approval will the endorsement be issued.
The point I’m trying to drill into your rock is there will be many steps to obtaining this endorsement and may require time. If you need this endorsement or you think you may need it, request it up front from your Texas title company to save your closing from being prolonged.
This new endorsement may not be a big deal in the Houston area where typically, residential owners do not own the minerals to their property. However, in areas like the Dallas-Forth Worth metroplex, it is quite common for residential owners to still retain the minerals to their property. It is worth taking the time to ask your borrower if they would like this endorsement to show them you are the smartest mortgage specialist in the room.
Note that this is not an endorsement that will be automatically issued. In order for the owner or lender of the property to be insured, the endorsement will need to be requested directly with the Texas title company insuring the transaction.
There is still some uncertainty as to the pricing of the T-19.2 and if credits such as the R-8 refinance credit, apply, but the Texas Department of Insurance presumably will clear this up in the next few weeks.
For timing’s sake, it will be important to notify your Texas title company if this endorsement is going to be requested as soon as possible. Mineral right researches require more work than a normal title search and, thus, much more time. Some mineral right researches can take weeks depending on issues such as how far back the deed was taken out, were the minerals ever severed from the surface, were there any deaths, were the rights transferred, etc.? And once the research is completed, the information gathered concerning the mineral rights being insured by your Texas title policy will need to be reviewed by the appropriate underwriter or attorney. Only upon their approval will the endorsement be issued.
The point I’m trying to drill into your rock is there will be many steps to obtaining this endorsement and may require time. If you need this endorsement or you think you may need it, request it up front from your Texas title company to save your closing from being prolonged.
This new endorsement may not be a big deal in the Houston area where typically, residential owners do not own the minerals to their property. However, in areas like the Dallas-Forth Worth metroplex, it is quite common for residential owners to still retain the minerals to their property. It is worth taking the time to ask your borrower if they would like this endorsement to show them you are the smartest mortgage specialist in the room.
Labels: arlington title company, dallas title company, dfw title company, fort worth title company, mineral rights, Texas title insurance
posted by R. Jason Griffin at
9:43 AM
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