Title agents

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Title Agents

Watered-Down Title Searches

A phenomenon of the title industry is that lenders have been driving for "faster" real estate closings such that, although consumers are unaware, there has been a push for "abbreviated title searches" with an "indemnification" title insurance policy to cover whatever is missed. Beware - some title agencies perform only "short" title searches instead of thorough, professional title examinations. The following "sarcastic" article is intended as a warning to the national real estate title industry and a revelation to the home-buying public. If you shop for the lowest priced title exam you may be getting "watered-down" service and supporting less reputable title agencies. The article sets forth the "talking points" against these less professional "short" title search practices. Owners' title insurance is certainly recommended with competent title examination but NOT as a substitute to the latter. - Bob Calongne.

Is it time for the watered-down home?

How stupid are we? We are apparently stupid enough to shell out a buck forty-nine to buy tap water with a nickel's worth of vitamins - will we be just as stupid if we spend $149,000 for our home without a title search?

Bottled water with vitamin C, B, E, and other nutrients is the latest craze in the beverage business. Estimated sales could exceed $100 million this year. Gatorade offers Propel Fitness Water, while Pepsi, Reebok, Arizona, Seagrams, Snapple, and Glaceau - which claims to have started the phenomenon - all stake claims in the market.

However, Good Housekeeping's director of nutrition commented (in a 2002 interview by "Good Morning America"), "Generally, the vitamin amounts in these waters isn't that much, you may get 10 percent, 20 percent of your daily value," and concluded that there is no real benefit for consumers who drink vitamin water, saying, "It's only beneficial for the company's bottom line."

Could it be that the gazillion dollar real estate mortgage lending industry would put its bottom line ahead of the interests of home-buyers and promote watered-down service in the interest of expediency? Remember the "good ole days" when you bought a house and they would do an appraisal, a survey, a pest infestation report and a full title search? Apparently that is no longer necessary because now they routinely omit the survey entirely (not surprising since the survey took the longest time to accomplish and prepare), they get "drive-by appraisals" and even some national title underwriters authorize limited one-link title searches (check the title only back to the last institutional lien) and they even propose an expedient national electronic search.

Did someone even try to persuade the home-buying public that they don't really "need" a full-blown title examination? ...that they don't "need" skilled personnel who are most knowledgeable of the local practices and idiosyncrasies to carefully examine the public records? ...that with an "indemnification" policy a mere cursory check of the records will be "good" enough? ...that if a title problem exists they can just buy another home for the amount of their original title policy? I doubt that and I doubt that the public would knowingly decide that the roof over their heads is less important than a "piece of paper"...

Maybe some title agencies won't even let them decide and thereby continue to charge them as much as ever. What they don't know won't hurt them, right? I don't believe that and here are a few reasons why?

Because the right thing to do is to perform a competent and complete local title examination and fix the problems beforehand and because your mother would want nothing less if she were buying the home

Because the public records that legally affect the title to that real estate are locally situated in the same place where the property is and not in a computer in Trinidad

Because the typical consumer expects the title industry to "examine title" so, if it does something less, the public might claim: (1) That the title agency's work is shoddy and unprofessional? (2) That the title agency breached its ethical responsibilities? (3) That the title agency made fraudulent misrepresentations? (4) That the title agency overcharged for its services? (5) That the title agency violated RESPA regulations?

Because while those title agencies are suffering the expense and embarrassment of the potential lawsuits, ethical inquiries, regulatory scrutiny and customer complaints their business will be heading down the street to where they are delivering quality service and

Because if a watered-down title examination is acceptable, then we are all about an inch away from dispensing with the title examination altogether and neither a title agency nor any title plant will have ever been necessary

...and if that time comes, then those in the real estate title industry can read magazines all day and sip vitamin water while their own visions of home ownership dissolve?

R. J. Calongne, Jr., A Professional Law Corporation