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Can you get title insurance for a co-op?

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2015-07-16 18:58:26
2015-07-16 18:58:26

Typically the only type of title insurance that can be issued on a Co-Op would be a Lease-hold Mortgage Policy that covers the Lender for a Mortgage.

Because the interest in the property is held as shares, an Owner's Policy would not be issued.

However, if purchasing a Co-Op, it would be advisable to have a Report on Title or Title Search done on the property, Co-Op association, etc.

No title insurance is not available on COOP's due to it not being real property, it is considered 'shares' in the coop. Typically though lenders have stricter regulations to clear coops to closing. The UCC (uniform commerical code) would be pulled on the property and all parties involved(sellers and buyers). For example the UCC would be order on any downstate New York COOP properties, the lender then would review for any lien on the property or judgments against borrowers or the sellers. Any adverse judgments then would delay closing until resolved. In the case of New York, if a property is in questions NYC.gov is a good start, you can search all judgments against a property.

Beware, beware, beware. I have personally experienced fraud in the name of Title Insurance for a co-op. A company was promising that they had a waiting buyer, and all the seller had to do was to pay for the title search in advance. Unfortunately, these sellers were so enthralled with the idea of selling, that they actually wire money in advance to this company, and that was the end of their money, contact, and the sale. I've seen it happened to well-educated attorneys as well as countless well-meaning men and woman. If I can express one thing emphatically, its never to pay any closing or title related fee up front. Also remember things have to feel right when they are truly easy.

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