Real Estate Tip: ALTA 34-06 – The Endorsement That Saves The Day


Real Estate Tip: ALTA 34-06 – The Endorsement That Saves The Day

Buyers and developers who are focused on negotiating terms of transactions, projecting future income and meeting deadlines, can often ignore real estate title issues until a defect in a title threatens to derail a closing. Timing is everything and defects have a way of surfacing when the closing date is in sight and delay is not an option.

A frequent response to a sudden title defect is to get affirmative coverage from the title insurance company, which can take many forms and provide different coverages. Negotiating transaction-specific coverage is always a possibility, as is selecting one of the American Land Title Association’s endorsement forms. The all-purpose endorsement, ALTA 34-06, can start the affirmative coverage discussion regardless of the specific type of title defect that has surfaced.

The ALTA 34-06 endorsement will recite the title defect and:

  • Indemnify the buyer if the defect results in a final judgment against the buyer
  • Make the buyer whole if a future buyer or lender refuses to buy or lend because they cannot get similar title insurance coverage for a new purchase or loan
  • Pay the buyer’s attorneys’ fees and costs in defending the title against the identified defect

By combining several concepts often found in specifically negotiated affirmative coverage clauses, the ALTA 34-06 endorsement provides a convenient shortcut and may be the white knight that saves the (closing) day.

Today’s real estate tip is brought to you by Rick Smith, a LEED Accredited Professional and member of Bernstein Shur’s Real Estate Practice Group and Green Building Team. Stay tuned for more useful tips for real estate professionals.

For more information, contact Rick at or 603 623-8700 ext. 8829 or 207 774-1200.