[The following is the text of a LAWPRO alert sent October 7, 2014. This post mirrors the alert, but includes samples of the new exemption clauses we have seen in claims files.]
LAWPRO has become aware of a new exception to coverage in certain title insurance policies which could expose real estate practitioners to claims from their private lender clients.
The issue has recently arisen in connection with private residential mortgage transactions, and in particular where the lender and borrower are separately represented, as required, because the loan is more than $50,000. This is the basic scenario: After the lender’s . . . [more]