Everyday I work with prevention of title claims prior to closing and correction of title problems that are discovered later. Over my morning coffee, these are the problems on my desk to work out this morning:
1. File closed in 1999 with owner title policy. The insured just received notice of revival of a state tax lien from 1997 in the amount of $696. I’ll be reviewing our search file to see if the lien is valid. If so, how was it missed? If the lien is not valid, we’ll defend the property and fix the problem. If the lien is valid, it will be paid. The insured owner is covered.
2. I have a search that revealed a second mortgage in foreclosure. The sellers had filed bankruptcy and assumed they could ignore the foreclosure notice. They put the property on the market and sold it to a buyer who was smart enough to order title insurance. We suggested that the seller pursue a “short sale” – a reduced payoff with the lender to avoid foreclosure. I’ll help them process the short sale request later today.
3. I have a corrective deed to prepare and send out to a seller. Both the buyer and the seller failed to disclose there was a second parcel that should have been conveyed back in 2003 when we insured their title and closed the purchase transaction. When discovered, the seller’s attorney refused to assist the correction in any way even though he had prepared the original incorrect deed. We are fixing it.
4. In 2005 we held money from a seller’s proceeds to satisfy numerous liens. They had been paid but not satisfied of record. The seller’s attorney will not return our phone calls. We are hiring an attorney – at the seller’s expense from the funds in escrow – to resolve and satisfy the liens and clear the title.
These four simple cases are part of my normal everyday work life. Each of the files is covered by an owner title insurance policy and thus the work I am doing is part of that coverage. It’s unlikely that any of this work will be counted in claims reported by title insurance companies. This is the unseen work done by the folks who get the lion’s share of the title insurance premium.
This afternoon, I’ll have a new set of title issues to work on. I love my job and hope this helps you understand why an owner title insurance policy is a good investment.