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Unformatted text preview: nterest in due property. 2. 3. 4. Forgery. Impersonation or lack of capacity of a party to a transaction. For example, transaction with a minor. Defective delivery of a recorded grant deed. Under standard policy, the title company does not make a physical inspection of the property and therefore excludes the following: It does not protect against unrecorded easements and liens, encroachments or rights of parties in possession. Changes in land use dictated by zoning ordinances. Mining claims and water rights. 12-20 Licensing School for Appraisal, CPA, Contractors, Insurance, Real Estate, Notary, Nurse, Food Handlers, Tax and Securities 12: QUALIFYING THE PROPERTY
EXTENDED POLICY (ALTA)
Other risks can be ascertained by an on-site inspection of the property and a survey. Extended coverage is established and normally required by lenders. If the owner wants additional perils covered, extended coverage or a special endorsement can be added to cover these risks. An ALTA extended coverage lender's policy includes standard coverage provisions plus: Incorrect survey of property boundary lines or size of lot. Violations of recorded covenants, conditions, and restrictions. Encroachments of improvements onto existing easements. Any unrecorded easement rights disclosed by inspection. The rights of other parties, possessory or otherwise, disclosed by inspection. Unrecorded leases of tenants occupying the land. Unrecorded assessments as disclosed by public works activity in the area and inspection of tax office records (if work is in progress). Unrecorded claims resulting from work performed or materials provided for recent improvement of the land. The extended coverage policy is commonly referred to as an ALTA (American Land Title Association) policy. The ALTA policy, which includes a competent survey or physical inspection, is usually required by California and out-of-state lenders who are not able to make a personal, physical inspection of the property. The borrower pays for this policy. No policy will protect against defects known to the insured or against government regulations concerning occupancy and use (zoning). ALTA-R Dynasty School (www.dynastySchool.com) 12-21 REAL ESTATE FINANCE
The ALTA-R policy is recommended by title companies, for one-to-four ow...
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This note was uploaded on 12/30/2010 for the course SOC 101 taught by Professor Zhung during the Spring '10 term at Punjab Engineering College.
- Spring '10