What Schedule B of a Title Commitment Lists, and Which Exceptions Have to Be Cleared

A title commitment is the title company's written promise to issue a title insurance policy, on stated conditions. It is not a report on your home's condition and it is not an appraisal. It is a statement of what the public record says about ownership of your parcel, and what the insurer will and will not cover once the transaction closes.

The document is usually organized into Schedule A and Schedule B. Schedule A is the factual summary: who is insured, the dollar amount of coverage, the current vested owner, and the legal description of the land.

Schedule B is where the conditions live. It is the part that generates questions, because it is where the title company tells you what has to happen before the policy issues and what the policy will refuse to insure against.

Part I is a to-do list. These are the items the title company requires before it will issue the policy, and in a refinance they are the items that genuinely have to be cleared before funding.

Typical requirements include payoff and release of the existing mortgage, satisfaction of recorded judgment liens or tax liens, execution and recording of the new deed of trust, resolution of a name discrepancy in the chain of title, and documentation showing that a trust or LLC holding title has authority to sign. If a prior loan was paid off but the release was never recorded, that shows up here too, and it is more common than people expect.

Most Part I items are handled by the title company and the closing agent as routine work. The ones that slow a file down are usually the ones that need something from you: a trust certification, a corrected legal name, or a payoff statement from a small lender that is slow to respond.

Part II lists what the title policy will not cover. These are called exceptions, and the important thing to understand is that an exception is not automatically a defect. It is simply a matter of record that the insurer is declining to insure against.

Many exceptions are permanent features of the land and will never be removed. Recorded easements for utilities, drainage, or shared access. Subdivision covenants, conditions, and restrictions. Mineral or water rights reserved by a prior owner or by the state. Setback lines shown on the recorded plat. These stay on the policy for the life of the property, and a lender will fund over them without comment.

A smaller category of exceptions does matter. An unreleased lien, an unresolved boundary or encroachment issue, a recorded lis pendens signaling active litigation, or an easement that runs directly through the footprint of the house can each cause a lender to require action. In practice, the test is whether the item threatens the lender's lien position or the marketability of the property.

Start by separating Part I from Part II, because they carry different weight. Anything in Part I is a condition of closing by definition. Anything in Part II is being disclosed rather than required, and most of it is background noise attached to the dirt.

Then look at dates and dollar amounts in Part II. A recorded document from decades ago describing a utility corridor is very different from a mechanic's lien filed last spring. Judgment liens, tax liens, HOA assessment liens, and anything with a name close to yours deserve a direct question to the title officer.

If you own the property in a trust or an entity, expect extra requirements around signing authority. That is standard, not a sign that something is wrong. On a cash-out refinance in particular, the lender wants clean confirmation that the person signing has the authority to encumber the property.

The title commitment is typically ordered early, and the first version often contains items that get cleared quietly before anyone mentions them to you. Reviewing it when it arrives, rather than at signing, is the single practical thing that shortens a file.

If something on the list surprises you, say so early. An old release that was never recorded, a name spelled differently on a prior deed, or a lien belonging to someone with a similar name all take time to correct through the county recorder, and that time is easier to absorb three weeks out than three days out.

The questions worth raising with your title officer are simple: which of these are requirements, which are exceptions, and which exceptions is my lender going to ask you to remove. You can read more about how a refinance file comes together on our loan overview page.