Carlos enters into a contract to purchase a condominium in Brooklyn. The contract states that Carlos will receive 'insurable title' rather than 'marketable title.' At closing, the title company discovers a minor lien that would prevent them from issuing a standard title insurance policy. Under New York law, can Carlos refuse to close?
Correct Answer
C) No, because insurable title only requires that title insurance can be obtained at standard rates
In New York, 'insurable title' is a lower standard than 'marketable title.' Insurable title means the title company will issue a policy at standard rates, even if minor defects exist that would be covered by the policy. The seller only needs to provide title that a reputable title company will insure at regular rates.
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Previous Question
Jennifer contracts to purchase a house in Albany from Steven for $400,000. The contract includes a clause requiring Jennifer to obtain homeowner's insurance before closing. Three days before closing, Jennifer's insurance application is denied due to the property's proximity to a flood zone. Steven refuses to extend the closing or modify the contract. Under New York law, what is the most likely result?
Next Question
Sarah, a licensed real estate salesperson in New York, is representing a buyer who asks her to explain the legal implications of a specific clause in the purchase contract. The buyer wants to know if the clause will protect him from liability in case of a title defect. What should Sarah do?