California Real Estate Practice Exam

After moving into a home with a standard policy of title insurance, a buyer discovers that the roof eave is only two feet from the property line, while the zoning requirement is five feet minimum. How much can the buyer collect?

1. nothing

2. price of damages plus cost to repair

3. price of repair minus attorney fees

4. price of the property plus treble damages

The correct answer is: nothing

The buyer can collect nothing because title insurance typically covers defects in the title and issues that may affect ownership rights, such as liens or encumbrances. It does not address zoning issues or violations of local ordinances, such as setback requirements. In this case, the new homeowner is dealing with a zoning compliance issue rather than a title defect. Zoning regulations are enforced by local governments, and homeowners are generally expected to be aware of these regulations upon purchasing a property. Since the title insurance policy does not cover zoning compliance or issues related to property lines, the buyer has no recourse through the title insurance for the encroachment of the roof eave into the setback area. Thus, the correct answer reflects that the buyer cannot collect any compensation for the situation outlined.