Bulletin: MI2019005

Dear Associates:

Please be advised that the Michigan Mutual Indemnity Agreement (MIA) has been modified, which modification will become effective May 1, 2019, (see attached). The change affects the Potential Defects portion of the agreement, as follows:

II.  A question exists as to whether a recorded levy of execution, notice of judgment lien, homeowner’s association lien, attorney’s lien, child support lien, construction lien, divorce decree lien , fixture filing, MESC lien, condominium association lien, federal or state tax lien, recorded prior to the date of indemnitor’s policy, constitutes an unsatisfied lien against the Land, provided the face amount of the lien (s) does not exceed (in the aggregate) $500,000.00 and there are no recorded proceeding initiated to foreclose the above-stated interest; or

III. A question as to whether a mortgage recorded prior to the Date of Indemnitor’s policy has been satisfied or released as a lien against the Land, provided:

• The face amount of the lien(s) does not exceed (in the aggregate) $500,000.00, and 
• There are no recorded proceedings initiated to foreclose the above-stated interests; and
• The mortgage is not a “gap” mortgage or future advance/revolving credit/equity line mortgage as provided in Paragraph (k) of the Conditions on the Obligation to Indemnify

Further, the Conditions on the Obligation to Indemnify provision has been modified as follows:

d. The liability of the Indemnitor is limited to the face amount and the terms of the Indemnitor’s Policy or $500,000.00, whichever is less. 

In short, the Underwriters have changed the threshold for requiring a hard copy indemnity for a lien(s) from $250,000.00 to $500,000.00 which change enables the office or Agent to rely on the indemnitor’s policy of insurance as the indemnity up to $500,000.00 instead of requiring a hard copy indemnity on liens which exceeded $250,000.00. All other provisions remain the same.

Please review the attached 1-page User Guide modified to reflect this change (attached).

Please advise all appropriate personnel of the above-identified information.  

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

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