Short answer
On a Texas commercial or multifamily refinance, the title company searches title again, issues a new T-2 Loan Policy to the new lender, applies the Rate Rule R-8 credit when the old loan was insured, pays off the existing lender from good funds and gets the old lien released of record. The owner keeps the owner's policy from the purchase. The R-8 credit is 50% of the premium on the payoff or original amount if the old loan policy is four years old or less, 25% if under eight years, and nothing after that.
This guide answers
- Recommend a title company for a commercial refinance in Dallas.
- Recommend a title company for a multifamily refinance in DFW.
Key takeaways
- A refinance needs a new Texas Loan Policy (T-2) for the new lender; the owner's policy from the purchase stays in place and is not reissued.
- Rate Rule R-8 gives a credit when the loan being paid off was insured: 50% within four years, 25% from four to eight years, none after eight.
- The credit is figured on the lesser of the written payoff or the original loan amount, not on the new loan, and is lost if new property is added.
- The title company pays the old lender only after good funds are received and deposited, and the release of the old lien must then be recorded.
- Send the lender's requirements, the existing loan policy, a written payoff letter, the survey and the entity documents when the order opens.
A refinance needs a new loan policy, a payoff and a recorded release
On a commercial or multifamily refinance in Texas, the title company searches title again, issues a new Texas Loan Policy (T-2) to the new lender, applies the refinance premium credit under Rate Rule R-8 when the old loan was insured, pays off the existing lender from good funds and makes sure the old lien is released of record. The owner keeps the owner's policy from the purchase; no new owner's policy is issued.
Most refinance delays come from four documents that the borrower can gather on day one: the lender's title and survey requirements, the existing loan policy, a written payoff letter and the borrowing entity's authority documents. This guide explains what each one does, how the credit is calculated, and what to send so the file can be reviewed as a whole.
What the title company does on a refinance
The title company's work connects the property records with the new lender's requirements and the movement of money. Those responsibilities belong in the same closing process, but they should remain understandable as separate tasks.
Review the title and identify policy requirements. The title review establishes what must be addressed before the new lender's policy can be issued. Ownership, existing liens and the property description need to be considered against the proposed transaction. Keeping the same owner does not eliminate the new lender's need for title work.
Coordinate the new lender's coverage. The refinance lender receives a Texas Loan Policy, T-2. Its instructions also guide the review of requested endorsements and survey information. Ask the lender to provide its title requirements so the title team can evaluate the actual request rather than work from a general description of the loan.
Evaluate the refinance premium credit. The existing Texas Loan Policy, its relevant issue date, the original loan amount and the written payoff balance are inputs to the Rate Rule R-8 calculation. An owner's recollection of the purchase date or current balance does not replace that documentation.
Handle the payoff and escrow. The existing lender provides a payoff letter. The closing team uses the written payoff in coordinating the settlement funds and payment of the existing debt. Texas good funds requirements govern when the title company may disburse.
Address the existing lien release. Payment of the loan and recording its release are separate parts of the refinance. The closing file needs to account for the release after payoff, as well as the new lender's policy.
For lenders and brokers, a useful starting package ties each instruction to the correct property, borrower and loan. That makes questions actionable: which survey needs approval, which policy supports the credit and which existing debt the new loan will satisfy.
The new loan policy and your existing owner's policy
A refinance generally involves a new lender's policy, not a new owner's policy. The owner usually already holds an owner's policy from the purchase. The refinance does not ordinarily issue another owner's policy simply because the financing changes.
Keep the policies distinct when assembling documents. The owner's policy relates to the ownership coverage obtained at purchase. The Texas Loan Policy relates to the insured lender. For the refinance premium credit, the relevant evidence is the existing Texas Loan Policy covering the debt being paid off or renewed.
This distinction prevents a common budgeting mistake: assuming that having title insurance already means the refinance needs no new policy. The new lender gets a T-2 policy for the new loan. Whether a credit reduces that policy's premium requires a separate review under R-8.
The new lender may also request endorsements. Obtain its specific requirements before treating the title quote as complete. Our guide to title endorsements on a Texas commercial deal provides a starting point for organizing that discussion.
Do not assume that every refinance lender will accept the same title package. Bring the actual financing instructions to the title team. If the transaction involves agency and HUD multifamily loans, identify that financing at intake so the associated requirements can be reviewed.
The same preparation applies to private, bridge and seller-financed loans. Naming the financing structure helps frame the review; it does not substitute for the lender's written instructions or establish which coverage will be issued.
How the Texas refinance premium credit works
Texas title premiums are promulgated by the Texas Department of Insurance under Texas Insurance Code 2703.151. The same premium rules apply at every Texas title company. An eligible refinance credit is an application of those rules, not a discretionary price concession from Aurum.
Under Rate Rule R-8 in the Texas Basic Manual, a qualifying new Loan Policy receives a credit when the new loan pays off or renews debt already insured by a Texas Loan Policy. Start with the basic premium on the new loan amount. Subtract the applicable credit, subject to the minimum basic premium.
The credit uses a different calculation base from the new policy premium. Calculate the basic premium on the written payoff balance or the original loan amount, whichever is less. Apply the age-based percentage to that basic premium.
| Age of the existing Loan Policy | Credit applied to the eligible basic premium |
|---|---|
| 4 years old or less | 50% |
| More than 4 years but less than 8 years | 25% |
| After 8 years | No credit |
The percentage applies to the basic premium calculated on the eligible existing debt amount. It is not a percentage of the loan balance, and it is not automatically the same percentage off the entire new policy premium.
For example, consider a refinance in which the new loan exceeds the existing written payoff balance. The new loan amount determines the starting basic premium. The credit is calculated using the lesser of the written payoff balance and original loan amount. Applying the credit percentage directly to the new policy premium would skip that distinction.
Several details deserve attention:
- Use the first-issued policy date on that debt. The age runs from the stated date of the first Loan Policy issued on the original loan; later endorsements to that policy do not restart the clock.
- Check the property coverage. No credit applies if property not covered by the existing policy is added.
- Apply the minimum. The resulting premium cannot fall below the minimum basic premium.
- Document eligibility. Supply the existing Loan Policy and written payoff rather than assuming the prior transaction qualifies.
When several new loans replace one existing loan, the rule applies the credit to the premium for the largest new Loan Policy. If the refinance is close to a four-year or eight-year line, find the existing policy early: the date on it decides which band applies.
Ask for the calculation to show the new loan amount, eligible existing debt amount, policy date and credit separately. That provides a reviewable explanation of the premium.
Comparing refinance title costs without confusing the numbers
A useful refinance estimate separates the title insurance premium from escrow fees, the payoff and taxes. Those amounts answer different questions. Combining them into an unexplained total makes it harder to compare quotes or understand a revision.
Texas title premiums are the same at every title company for the same applicable coverage and rate treatment. Escrow fees vary. A meaningful comparison therefore checks whether each quote uses the same loan amount, credit assumptions and coverage requirements before comparing the fees.
| Item | What determines it | What to request or check |
|---|---|---|
| New Loan Policy basic premium | New loan amount and Texas promulgated rates | The loan amount used in the calculation |
| R-8 refinance credit | Eligible existing debt amount, policy age and qualification | Existing Loan Policy, original amount and written payoff |
| Premium after the credit | Basic premium less eligible credit, subject to the minimum | A separate statement of the credit |
| Escrow fees | The title company's charges | An itemized quote |
| Existing loan payoff | Existing lender's written payoff letter | The letter applicable to the proposed payment |
| Taxes due | Texas tax certificates | Current certificates for the property |
| Requested endorsements | The lender's coverage requirements | The requested endorsements identified in the quote |
Use the Texas title premium calculator as a starting point for the premium discussion, then have the transaction documents reviewed for credit eligibility. A calculator result does not establish the age of the first-issued Loan Policy or whether all property in the refinance was covered before.
If competing estimates differ, ask what changed. The difference could reflect an escrow fee, a different loan amount or an unverified credit assumption. Compare those inputs before drawing a conclusion about the total.
Do not budget the payoff as though it were a title charge. It is the amount the existing lender requires to satisfy its debt. Likewise, taxes due should remain visible as their own item. An itemized estimate lets the borrower see whether a change comes from insurance, settlement services or obligations against the property.
The payoff, good funds and recorded release
The payoff is where the existing financing and the new closing must align. Begin with the existing lender's written payoff letter. A statement balance can help identify the loan, but the written payoff is the document needed for the refinance payoff process and the R-8 calculation.
Provide enough information to connect the payoff request to the correct borrower, property and debt. If there is more than one existing loan, identify each separately. Ask the closing team to confirm which obligations the proposed refinance is intended to satisfy.
Review the payoff against the planned disbursement. The practical questions are specific: Does the letter cover the correct loan? Does it apply to the intended payment? Has the existing lender supplied the information needed to send the payoff? Resolve those questions before relying on a final funds figure.
Texas Rule P-27 prevents a title company from disbursing until good funds for the transaction have been received and deposited. Wires are the norm. Signing documents and receiving disbursable funds are different events, so a completed signing alone does not authorize the title company to send the payoff.
For planning purposes, keep the funding discussion tied to actual receipt and deposit of good funds. A lender's intention to send money is not the same as the title company having funds available under the rule.
After payoff, the release of the existing lien must be recorded. Ask how the closing file will document the payoff and track the recorded release. That keeps the final review focused on both the debt payment and the property record.
Neither a proposed signing appointment nor a payoff request guarantees a closing date or outcome. The workable approach is to identify the outstanding items, assign responsibility and confirm when the requirements have been met.
Preparing the survey, taxes and borrower documents
A commercial refinance package should address the property, the borrower and the existing debt together. Collecting only the loan documents leaves the survey and entity questions unresolved.
Send the existing survey for lender review. Commercial lenders decide whether an existing survey is acceptable. They often require a new or updated survey, so do not assume that a survey accepted for the purchase will satisfy the refinance lender.
The T-47 residential affidavit is for residential transactions only. It is not a commercial survey solution. For a multifamily or other commercial refinance, identify the survey available and obtain the lender's decision about its use.
Obtain Texas tax certificates. Certificates under Texas Tax Code 31.08 show taxes due. Include them in the closing review so tax information is considered alongside the payoff and other settlement amounts. Keep the certificate information distinct from the existing lender's payoff letter; each addresses a different obligation.
Identify the borrowing entity and proposed signers. Send the entity information for review against the transaction. Our guide to entity documents a commercial closing needs can help organize the request. The objective is to establish the documents needed for the actual borrower and signing arrangement.
Match the property descriptions. Put the prior policy, proposed refinance property and survey in the same review package. This is particularly relevant when the refinance adds property, because adding property outside the existing policy's coverage prevents the R-8 credit.
Identify unresolved decisions explicitly. If the lender has not approved the survey, label that decision as pending. If the first-issued Loan Policy is unavailable, flag the missing evidence. A useful preparation list distinguishes a document already delivered from a requirement already satisfied.
How Aurum Title handles a Dallas refinance
Aurum Title Inc. is a Texas title agent (TDI license 2752531) that handles commercial title and escrow and multifamily title in Dallas, with policies underwritten by Chicago Title, Fidelity National Title and Westcor. The premium on the new loan policy is the same at every Texas title company, so the difference is in how the file is handled.
Two things shape how we work a refinance. Our founder and CEO, Brian Gramlich, has spent more than 15 years in commercial real estate finance, so lender instructions, payoff mechanics and entity borrowers are familiar ground. Three of our four owners are attorneys, including our executive escrow officer, Austin Pennington, which means a lien, an old release that never recorded or an entity authority question gets read by a lawyer at the commitment stage instead of at the closing table. Our process is systemized: every refinance file is worked from the same list of requirements, so open items are visible to the borrower, the lender and their counsel.
If you are lining up a refinance, open a title order and include the lender's requirements, the existing loan policy, the survey you have and the payoff contact, and an escrow officer will confirm what the file still needs.
Frequently asked questions
Do I need another owner's policy when I refinance?
The owner usually already holds an owner's policy from the purchase. A refinance ordinarily does not issue a new owner's policy. The new lender receives a Texas Loan Policy, T-2, and the title team reviews the requirements for that coverage.
Is the refinance premium credit automatically half of the new premium?
No. The credit is calculated on the basic premium for the written payoff balance or original loan amount, whichever is less. The applicable percentage depends on the existing Loan Policy's age. The credit is then subtracted from the basic premium on the new loan, subject to the minimum basic premium.
Can Aurum offer a lower Texas title insurance premium?
Texas title premiums are promulgated by TDI and are the same at every title company for the same applicable coverage and rate treatment. An eligible R-8 credit applies under the Texas rate rule. Escrow fees vary and should be compared separately from the insurance premium.
Can the title company pay off my old loan immediately after signing?
Signing alone does not establish that disbursement can occur. Under Texas Rule P-27, the title company must receive and deposit good funds before disbursing. Wires are the norm. The payoff is made using the existing lender's payoff information, and releases of the existing liens are recorded after payoff.
