How to get the best title coverage for your clients (Part 11) ALTA Endorsements

Following is a brief description of the endorsements more commonly used in residential and commercial transactions.

ALTA Endorsements

a. ALTA 1 - Street Assessments (6-1-87)

The ALTA 1 insures against the possible consequences of a street assessment lien gaining priority over the insured mortgage.

b. ALTA 3 - Zoning & Use (6-1-87) (CLTA 123.1)

The ALTA 3 provides assurances to the insured: (a) that the premises are currently zoned as a particular classification; and (b) specifying the use or uses to which the property can be put.

c. ALTA 3.1 - Zoning, Use & Compliance (6-1-87) (CLTA 123.2)

The ALTA 3.1 provides assurances to the insured: (a) that the premises are currently zoned as a particular classification; (b) specifying the use or uses to which the property can be put; and (c) assuring that the present improvement is permitted by that zoning as to certain matters.

d. ALTA 6 - Variable Rate Mortgage (6-1-87) (CLTA 111.5)

The ALTA 6 provides assurances to the insured lender against loss or damage resulting from the loan being declared invalid or unenforceable or suffering a loss of priority because of the provisions of the mortgage that relate to "changes in the rate of interest".


e. ALTA 6.2 - Variable Rate Mortgage (Negative Amortization) (6-1-87) (CLTA 111.8)

The ALTA 6.2 provides assurances to the insured lender against loss or damage resulting from the loan being declared invalid or unenforceable or suffering a loss of priority because of the provisions of the mortgage that relate to changes in the rate of interest and/or the addition of unpaid interest to the principal balance of the loan.

f. ALTA 8.1 - Environmental Protection (3-27-87) (CLTA 110.9)

Except as shown in Schedule B, the ALTA 8.1, a residential endorsement, insures against a lack of priority of the insured mortgage or deed of trust over a recorded environmental protection lien and unrecorded environmental protection liens provided for by any state statute other than those statutes specifically listed in the endorsement.

g. ALTA 9 - Restrictions, Easements & Minerals (3-27-92) (CLTA 100.2)

The ALTA 9 insures lenders against loss due to certain CC&R violations, violations of set back lines, homeowner's dues, encroachments, improvement removal or related damage from mineral extraction or development, and any right of first refusal.

h. ALTA 13 – Leasehold Owner’s

The ALTA 13 insures the validity of the lessee’s interest in a leasehold estate. The definitions, terms and conditions of the owner’s title insurance policy are modified by endorsement to provide additional protection for a leasehold estate, particularly in the area of calculation of damages.

i. ALTA 13.1 – Leasehold Lender’s

The ALTA 13.1 insures the validity and priority of a lender’s lien upon a leasehold estate. The definitions, terms and conditions of the lender’s title insurance policy are modified by endorsement to provide additional protection for a leasehold lender.

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