Page 100 - ALTA Endorsements Guide

A L T A E N D O R S E M E N T

1-06 to 9.6.1-06 9.7-06 to 17.1-06 17.2-06 to 28.3-06 29-06 to 36.6-06 36.7-06 to 46-06

ALTA ENDORSEMENT 32-06

CONSTRUCTION LOAN

Adopted (2-3-11)

1. Covered Risk 11(a) of this policy is deleted.

2. The insurance [for Construction Loan Advances] added by Section 3 of this endorsement is subject to
the exclusions in Section 4 of this endorsement and the Exclusions from Coverage in the Policy, the
provisions of the Conditions, and the exceptions contained in Schedule B. For the purposes of this
endorsement and each subsequent Disbursement Endorsement:

a. “Date of Coverage”, is [________________________] [Date of Policy] unless the Company sets
a different Date of Coverage by an ALTA 33-06 Disbursement Endorsement issued at the
discretion of the Company.

b. “Construction Loan Advance,” shall mean an advance that constitutes Indebtedness made on or
before Date of Coverage for the purpose of financing in whole or in part the construction of
improvements on the Land.

c. “Mechanic’s Lien,” shall mean any statutory lien or claim of lien, affecting the Title, that arises
from services provided, labor performed, or materials or equipment furnished.

3. The Company insures against loss or damage sustained by the Insured by reason of:

a. The invalidity or unenforceability of the lien of the Insured Mortgage as security for each
Construction Loan Advance made on or before the Date of Coverage;

b. The lack of priority of the lien of the Insured Mortgage as security for each Construction Loan
Advance made on or before the Date of Coverage, over any lien or encumbrance on the Title
recorded in the Public Records and not shown in Schedule B; and

c. The lack of priority of the lien of the Insured Mortgage, as security for each Construction Loan
Advance made on or before the Date of Coverage over any Mechanic’s Lien, if notice of the
Mechanic’s Lien is not filed or recorded in the Public Records, but only to the extent that the
charges for the services, labor, materials or equipment for which the Mechanic’s Lien is claimed
were designated for payment in the documents supporting a Construction Loan Advance
disbursed by or on behalf of the Insured on or before Date of Coverage.

4. This policy does not insure against loss or damage (and the Company will not pay costs, attorneys’
fees or expenses) by reason of any Mechanic’s Lien arising from services, labor, material or
equipment:

a. furnished after Date of Coverage; or

b. not designated for payment in the documents supporting a Construction Loan Advance disbursed
by or on behalf of the Insured on or before Date of Coverage.

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