A covenant of further assurance is a legal document that allows a homeowner to transfer their interest in real property to another party. It gives the new owner the right to take over the homeowner’s existing loan if he or she chooses to do so. To learn more about a covenant of further assurance, contact MacGregor Abstract.
A covenant of further assurance can be used for a variety of reasons, including:
Switching lenders. If you decide to switch lenders, the new lender will require you to put an additional lien on your property as security for the new loan. A covenant of further assurance is an easy way to do this.
Moving out of state. If you’re moving out of state and want to sell your home, but don’t want your current lender involved in the sale process, a covenant of further assurance can help ensure that there are no issues with your mortgage once you’ve moved away from New York State.
How Does It Work?
A covenant of further assurance is similar in many ways to a traditional mortgage or deed of trust — except that it gives someone else (not just the borrower) rights regarding ownership or use of real estate in exchange for money or other consideration given by that person or entity. The covenant holder does not have any direct rights or interest in real estate itself; instead.
In New York, a covenant of further assurance is a contract between two parties. A covenant of further assurance is different from a mortgage or deed of trust in that it allows a lender to take over the property if the borrower defaults on the loan. For example, if you have a mortgage on your home and you stop paying your mortgage payments, the bank can foreclose on your house. However, if you have a covenant of further assurance, they can take over the property even if you do not default on your payments.
In New York, there are several types of covenants that can be used as part of an agreement between two parties. These include:
Covenant for title insurance (COFI) – This type of covenant protects against any defects in title where the borrower does not own clear title to the property. It also protects against any defects in title where there are multiple owners listed on the deed and only one owner has paid off their portion of the debt. This type of covenant also protects against defects in title where only one owner has paid off their portion of the debt but they have failed to record their interest with the county clerk’s office so that other people cannot record their interest in that property as well.
A covenant of further assurance is a promise by a seller to correct any defects in the property that were not disclosed in the original agreement. This is most often seen when the seller has been asked to make repairs to the property before closing on the sale.
The covenant of further assurance is different from a warranty deed. A warranty deed is used when a seller or buyer is purchasing a property as their primary residence. In this case, the seller promises to fix any issues with the property before closing on the sale. A covenant of further assurance is used when both parties are not living in the home and are buying or selling it as an investment.
There are several reasons why you might need to use an attorney for your New York real estate transactions:
You want someone who knows all about local laws and regulations regarding buying and selling real estate, including covenants of further assurance (CFA).
You want representation that can translate all legal documents into plain English so you fully understand what they mean.
You want someone who knows how to get you through all stages of your transaction from start to finish without any unnecessary delays or complications.