California Real Estate Practice Exam

In an all-cash property sale, what is advisable to obtain?

1. Title insurance

2. A bank loan

3. A warranty deed

4. Personal property insurance

The correct answer is: Title insurance

In an all-cash property sale, it is advisable to obtain title insurance. This is because title insurance protects the buyer from any unknown issues or claims on the property's title, such as liens, easements, or boundary disputes. It ensures that the buyer has clear and undisputed ownership of the property. Obtaining a bank loan (option B) would not be necessary in an all-cash sale as the buyer is not relying on financing. A warranty deed (option C) is a legal document that guarantees the buyer that the seller owns the property and has the right to sell it, but it does not protect against any future issues or claims. Personal property insurance (option D) would only cover any personal items included in the sale and would not protect the buyer from title issues. Therefore, title insurance is the most advisable option for an all-cash property sale.