Title Commitment Guide for Solar Developers & Installers
Title Commitments are a necessity to secure loans for a solar project. SolRiver Capital wants developers and installers to understand why a Title Commitment is needed during the diligence process for you to secure an investment from us and what we typically require for it before you engage a title insurance firm. In this guide on Title Commitments, we discuss:
- What a Title Commitment is;
- Why SolRiver requires it from the developer and when it is needed;
- The scope SolRiver requires; and
- Who can provide the service.
What is a Title Commitment?
A Title Commitment is a document stating that a title insurance company will issue title insurance if the conditions of the commitment are satisfied. The Title Commitment details the title insurance coverage of the project site subject to any exceptions, based on the ALTA survey and a thorough review of the relevant title documents. The subsequent title insurance policy functions to protect a solar project from revenue loss in the event there are any exceptions to the title of the site that is covered by the policy. Title Commitments and insurance policies attempt to eliminate any risk involved in the land portion of the transaction by essentially certifying the land title.
Why is a Title Commitment needed and when do you need it by?
Most lending banks will not issue project developers a loan without an acceptable title insurance policy in place. The diligence process behind receiving a Title Commitment assures the lender that the project site title has been thoroughly examined and the title insurance policy will protect the project from any claims on title that may arise later on. If there are any encumbrances listed on the Title Commitment, a Subordination, Nondisturbance, and Attornment Agreement (“SNDA”) must be executed to a certain title prior to NTP. The Title Commitment must be dated no more than six (6) months prior to NTP and Title Insurance must be secured prior to receiving a loan.
What is the required scope for a Title Commitment?
The current scope we require is detailed in the Title Policy Endorsement Guidelines.
Who can help prepare a Title Commitment?
Stewart Title: https://www.stewart.com/en.html
Chicago Title Insurance Company: https://www.ctic.com/
SolRiver Capital is a solar investment fund dedicated to financing development, construction, and acquisition of small and mid-size utility-scale projects across the US.
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