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.
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Under California law, which deed transfers whatever interest the grantor may hold without making any warranties about the quality of title?
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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?