A California homebuyer is choosing between a CLTA standard title insurance policy and an ALTA extended title insurance policy. Which of the following most accurately describes the difference in coverage between the two policies?
Correct Answer
C) The ALTA policy extends coverage beyond recorded defects to include unrecorded liens, survey discrepancies, and rights of parties in possession
The ALTA (American Land Title Association) extended policy provides broader coverage than the CLTA standard policy. While CLTA covers defects appearing in the public record — such as recorded liens, forgery, and incorrect legal descriptions — the ALTA policy extends coverage to off-record risks including unrecorded liens, encroachments, survey discrepancies, and rights of parties in possession. An ALTA policy typically requires a physical inspection or survey of the property to underwrite these additional risks.
Why This Is the Correct Answer
Why the Other Options Are Wrong
Deep Analysis of This Transfer Of Property Question
Background Knowledge for Transfer Of Property
Real World Application in Transfer Of Property
Common Mistakes to Avoid on Transfer Of Property Questions
Related Topics & Key Terms
Key Terms:
Related Concepts
The closing process, also called settlement, is the final step in a real estate transaction where documents are signed, funds are disbursed, and title is officially transferred from the seller to the buyer.
Constructive notice is the legal presumption that a person has knowledge of information that is available through public records or visible inspection of the property, regardless of whether they actually knew about it.
A deed is a written legal document that conveys (transfers) ownership of real property from one party to another. It must be delivered to and accepted by the grantee to be effective.
More Transfer Of Property Questions
Taylor Torres wants to give the buyer the most complete deed protection, promising to defend title against lawful claims arising at any time in the chain of title. Which deed should be used?
In probate of an estate, which of the following is the last to receive payment, if any?
Assume the contract for the sale of real property includes the sale of certain removable items, such as paintings and furniture. Upon delivery of the deed, the seller also should deliver
A man died without a will and with no surviving relatives. His four-acre farm will
When the administrator of an estate sells a parcel:
- → Kevin buys a home in Oakland and takes a CLTA standard coverage owner's policy at closing. Eight months later a contractor who had finished work for the prior owner before the sale records a mechanic's lien against the property. Nothing about that work or the contractor's claim appeared in the public record on the date Kevin's policy was issued. How is Kevin's claim under his policy most likely to be treated?
- → Owner A received a deed to a California property in January 2024 and recorded it that same month. In March 2024 the same grantor deeded the property to Owner B, who paid fair market value, searched no records, and recorded immediately. Under California's race-notice recording statute, which owner prevails?
- → Under California law, what is the consequence when a property buyer fails to file the Preliminary Change of Ownership Report (PCOR) at the time the deed is recorded?
- → Under California law, which of the following must the seller of a single-family residence certify to the buyer in writing when the property is transferred?
- → County records show that Frank owns a property. Chad deeds that property to Melody. Chad’s deed is considered:
- → A California buyer's agent explains the concept of 'split escrow' to her client. In California, what does the term 'split escrow' refer to?
- → All of the following are sufficient to transfer an interest in real estate, except:
- → Alycia deeds property to Bernice for life, and then to Cynthia if Cynthia is living when Bernice dies. While Bernice is alive, what does Cynthia hold?
- → A foreign investor (non-U.S. person) sells a California rental property for $800,000. The property carries a mortgage balance of $700,000. The escrow officer calculates that the combined federal FIRPTA withholding (15%) and California state withholding (3 1/3%) totals about $146,667, which exceeds the seller's net equity of $100,000 after paying off the mortgage. What is the most appropriate course of action?
- → In a deed, the clause that defines the nature of the estate being granted is the:
People Also Study
Buyer Representation Agreement
8% of exam
Property Ownership
10% of exam
Land Use Controls and Regulations
8% of exam
Valuation and Market Analysis
10% of exam
Related Articles
How to Review Real Estate Ownership Transfer Questions Without Losing the Sequence
A topic that feels clear in notes can still fail in practice if recall has not caught up with recognition. If you are searching for review real estate...
Why Real Estate Ownership Review Gets Easier After You Sort Rights by Possession, Use, and Transfer
A topic that feels clear in notes can still fail in practice if recall has not caught up with recognition. If you are searching for real estate ownership...
Why Property Rights Questions Get Easier After You Sort Possession, Use, and Transfer Separately
A topic that feels clear in notes can still fail in practice if recall has not caught up with recognition. If you are searching for property rights...
Previous Question
Under California law, which deed transfers whatever interest the grantor may hold without making any warranties about the quality of title?
Next Question
During a home purchase in Los Angeles, the buyer's agent explains that in California, the seller customarily pays for a specific type of title insurance. Which policy does the seller typically pay for in a California residential transaction?