06.05.08
Posted in 60 second title work, E-recording, Value of a title searcher at 4:54 pm by Jeanne
As is typical of our industry, we are always engrossed in something. Currently the talk is potential RESPA changes, Fraud, and the Woes of a Weak Market (along with that age old fist-fight about the fairness of aba’s of course.) And these issues certainly do affecting our day to day business lives. But the relationship between the non-affiliated agent and his or her underwriter is a much bigger long-term issue for the agent. Independent agents, who think they can not be replaced by national REI plants, captive agencies or your Underwriter, beware.
I started in the title business in 1976. We believed then that abstracts of title were doomed and could be replaced at any moment with title insurance, or something else. We were right – it just took about 20 years longer than we thought. (Things changed a lot slower then.) In those days, the insurer insured the policies and the agent brought in the business and sold the policies. Today, with technology, things are changing at warp speed. The Underwriter is completely in the driver’s seat and there is no choice, title agents, so get used to it.
Insurers have changed the way business is done. The public wanted title work faster and cheaper. The insurers accommodated the public. Experienced, long-term agents with high quality standards were forced to undermine their standards in order to compete. The thorough, thoughtful search of the past is gone, replaced by a quick and dirty rendition put out with a cursory title search, i.e. risk underwriting.
The independent agent that was once the cornerstone of the title industry is disappearing, partially due to the surge in affiliated businesses that shepherded the business away; partially due to a very poor market; and also because Underwriters have been growing by gobbling up agencies and turning them into branches. Underwriters today are no longer dependent on local agents. The days of title underwriters worrying about quirks in each county are gone, again, risk underwriting. And in the future they will be even less dependent, as technology and electronic recordings allow information to be recorded and made available within minutes, perhaps even with little human intervention. Moreover, due to high agency defalcations and the claims in the last few years, it makes sense. Underwriters can have more control over day to day operations. Plus, by replacing an agent’s traditional title plant with the underwriter’s superior Real Estate Information (REI) technology, adding flood information, tax information, assessor information, maps and more it becomes salable as many products instead of one.
Yes, I believe the days of the independent, non-affiliated title agent are limited. But then again, I thought abstracts would be gone overnight, and it took 20 years.
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08.14.07
Posted in E-recording, Education, Money and Finance at 9:16 pm by Jeanne
Catching up on email today, I saw another fine example of fraud. This one I have seen many times, but it keeps rearing its ugly head. An average couple taking out a home-equity line of credit… er, that would be five home-equity lines of credit, all in the same day, sinking five different lenders into the mucky-mud of bad loans never being repaid because of a home with negative equity. More fodder for my classes.
How incrediby important is each person in the chain - The Closer in rushing the documents to the County Recorder - the Recorder in getting the documents of record, the Abstractor in checking the public record to new recordings.
As an educator for County Recorders, Abstractors, Closers and Title Personnel, I am always harping on how important it is to record in a timely manner. After all laws in most states explain that the first person to get to their document recorded at the Courthouse has legal rights over others. I stress with Recorders how important it is to be timely in recording. I stress with Closers in those states that do not close in escrow how important it is to record ASAP. And I stress with Abstractors how important it is to be thorough in checking the record.
I was recently told by a customer that their policy was NOT to bother to re-check the record if the existing work was 3 mos old or less. Alot can happen in 3 mos. Alot can happen in three hours - as the article exemplifies. I am saddened by those who do not think it necessary to re-check the public records at the time of closing to see if anything has been filed in the interim that would afftect title. In my opinion, they are being negligently irresponsible. In my opinion, check the Gap, or Pay the Consequences.
But, in a case like this one, even the most prudent Abstractors, Recorders and Closers would likely not help the loss.
Taking 5 loans in one day is a classic example of the danger in table-funding closings. In “table-funding,” the closer disburses funds immediately upon signing documents, and the danger of interim recordings, known as “the gap period,” is assumed. Under this scenario, the title insurer or closer is at tremendous risk. Will Underwriters in table-fund states re-think the way of doing business by requiring a closing in escrow or perhaps pushing e-recording – or will the traditional marketplace way of doing business continue to dictate…. time will tell.
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08.27.06
Posted in E-recording at 1:17 pm by Jeanne
Electronic Recordings in Minnesota are a reality.
A presentation and panel discussion by five people representing both the public and private sectors, demonstrated that e-recordings in Minnesota are alive and well. Mike Cunniff of Hennepin County, Geri Kane of Stewart Title, Rick Kvien of Roseau County, Gail Miller of Renville County and Rob Reitz of First American Title gave powerpoint presentations on the 3 models of e-recording and their status in Minnesota, followed by an informative Q&A session. Many were stunned at the speed of its progress, the commitment to making e-recording happen, and most of all, the amazing co-operative effort between the public and private sectors to so rapidly develop and implement a technology designed to work for all of us.
The lively discussion during the Q&A gave us a glimpse into the future, of both the benefits of the technology, and the many looming problems that will be encountered as the technology proceeds.An example is the proverbial “race to the courthouse” issue. Whose document will be recorded first, the attorney standing at the counter, or the Bank with an e-recording?
We will all be keeping an eye on this one.
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