Bulletin: TX000054

Dear Associates:

Rule P-2b ("Residential Refinance, Affidavit in Lieu of Updated Survey") requires us to accept a prior survey on refinances on residential real property. The rule says that we must accept the survey for the mortgagee policy if (1) the survey is no more than 7 years old, (2) the survey was performed for the borrower's purchase or financing of the land, and (3) the borrower executes the required affidavit. Residential real property is land with one-to-four family improvements on a platted lot, on five acres or less, or on 200 acres or less owned by individuals and used for agricultural production. On other transactions, Rule P-2a states that we must receive a "current survey," although that term is not defined by the Rule but simply suggests "still accurate or correct."

Company Policy on Residential Refinances

If you issue a commitment on an apparent refinance of residential real property, add the following note in Schedule C of the Commitment: "When amending the "area and boundary" exception in the mortgagee policy, the Company may rely upon a copy of a prior survey and affidavit by the borrower on residential real property if the borrower executes an acceptable affidavit. The Company may except to matters shown on the survey or the affidavit."

We are willing to rely upon a copy of a prior survey of any date (even over 7 years old) to amend the area and boundary exception on the mortgagee policy on a refinance of residential real property if you secure the attached affidavit from the borrower.

Company Policy on Giving Area and Boundary Coverage on Owner or Mortgagee Policy on Other One-To-Family Residential Land not Exceeding 25 Acres.

We will accept the affidavit and prior survey in order to amend the "area and boundary exception" on other one-to-four family residential land not exceeding 25 acres on either an owner policy (if the 15% premium is paid) or a mortgagee policy, based on a copy of a prior survey of any date. Based on the affidavit and language of P-2, we believe that the survey of any date (even over 7 years old) will constitute a "current survey" in those transactions. You may rely upon such survey and affidavit to provide the area and boundary coverage on :

• A Residential Owner Policy (T-1R), if the affidavit is signed by the seller
  
  
• A Mortgagee Policy (T-2) insuring a purchase money mortgage, if the affidavit is signed by the seller
  
  
• A Mortgagee Policy (T-2) insuring a Home Equity Mortgage, Reverse or other Mortgage not covered by the Refinance Rule, if the affidavit is signed by the borrower.

Company Policy on Giving Area and Boundary Coverage on Mortgagee Policy on Any Other Land (e.g. Commercial, Agricultural, Apartments) if Mortgagee Policy Does Not Exceed $5,000,000.

We will accept the affidavit and prior survey in order to amend the "area and boundary exception" on the Mortgagee Policy not exceeding $5,000,000 on any type of land. Based on the affidavit by the seller (if there is a current sale) or borrower (if there is no current sale) and language of P-2, we believe that the survey of any date (even over 7 years old) will constitute a "current survey" in those transactions.

Company Policy on Giving Area and Boundary Coverage on Owner Policy (T-1) on Any Platted Land (e.g. Commercial, Agricultural, Apartments) if Owner Policy Does Not Exceed $5,000,000.

We will accept the affidavit and prior survey in order to amend the "area and boundary exception" on the Owner Policy (T-1) not exceeding $5,000,000 on any type of platted land if the 15% premium is paid. Based on the affidavit by the seller and language of P-2, we believe that the survey of any date (even over 7 years old) will constitute a "current survey" in those transactions.

Please call our underwriters if your transaction does not comply with this guideline.

Do not rely upon this procedure if you believe that the survey is inaccurate or the affidavit is not true (such as where you know of subsequent improvements to the land).

If the size of your transaction exceeds your limits under your underwriting agreement, you must still secure your normal Overlimits Approval.