Author: Roger Therien

State: California

Form:		CLTA Form 101.8	Date: January 1, 1993

Subject:	Provides Lender whose loan is given for the sole or primary purpose of financing “site” improvement costs coverage concerning mechanic's liens which may arise from those improvements. It is designed for issuance with a CLTA Policy.

Requirements for Issuance:

1.	Obtain approval from an advisory title officer, branch counsel or the Underwriting Department prior to issuance of this Endorsement.

	Supervisory personnel are to obtain an inspection to confirm that there is no work in progress involving “site” improvements.

	“Site” improvements are defined to include demolishing or removal of existing improvements, trees or other vegetation; drilling test holes or grading, filling or otherwise improving the land or any adjacent street, highway or sidewalk; constructing or installing sewers, other public utilities; constructing areas, vaults, cellars or rooms under sidewalks for making improvements. [see Cal. Civil Code Section 3102]; and

Supervisory personnel are also to confirm in writing that the loan proceeds have been placed in the control of the lender under a binding agreement with the borrower which provides that such proceeds are to be applied to the payment of the site improvements and the borrower will not receive any proceeds until such payments have been made or the time for recording liens has expired and no claims have been recorded. [see Cal. Civil Code Section 3137]; and

If inspection discloses work in progress or requirement in paragraph #2 is not met, require Lender to obtain and record a Payment Bond. [see Cal. Civil Code Section 3139]

Preparation Instructions:

A.	Insert paragraph where insured mortgage is found in the Policy; and

B.	Delete “of Part II” and change Schedule B to Schedule A if issuing this Endorsement with an ALTA Policy.