Commonwealth Land Title Insurance Company, NCS

ALTA ENDORSEMENTS - 34 - SAMPLES AND DESCRIPTIONS VARIABLE RATE MORTGAGE – NEGATIVE AMORTIZATION – FORM 6.2 ALTA Endorsement — Form 6.2 is available only for loan policies. The endorsement insures the lender against loss or damage arising from the invalidity or unenforceability of the provisions in the Insured Mortgage which relate to periodic changes in the interest rate. The endorsement also insures the lender against loss of the priority of the mortgage lien if the loss of priority is caused by a change in the interest rate made strictly according to the terms of the Mortgage. In addition, ALTA Endorsement Form 6.2-06 provides insurance as to the validity and priority of the lien of the Insured Mortgage as security for additional principal created by the negative amortization of unpaid interest. Before this endorsement will be approved, the mortgage to be insured will be reviewed to ascertain that, among other matters, the provisions relating to the timing and measure of each possible change in the interest rate are clearly specified in the Mortgage. In some jurisdictions, a “cap” on the principal amount of indebtedness that might become due under the Mortgage must be clearly stated. It is important to note that the law in many states prohibits or greatly impairs the enforcement of negative amortization mortgages. As a result, the issuance of this endorsement may be approved only on a jurisdiction by jurisdiction basis. ALTA Endorsement — Form 6.2 (Variable Rate Mortgage – Negative Amortization – 07/01/2021) Form 6.2 Variable Rate Mortgage – Negative Amortization