- May 13, 2014
- Posted by: U.S. Title Records
- Category: Real Estate Post
Understanding the Process of Recording Land Titles
Property records describe the ownership of residential or commercial real estate or a piece of land. Notably, the process takes place in the form of a sale, although it may be an endowment or a gift. What is more, they contain evidence of actions of the conveyance of real property ownership benefits to some other party. Despite whether or not an exchange of funds occurs, the transaction must be affirmed with the court for it to be legal.
For this reason, state or county offices retain certified public contracts. The public office name varies from state to state, including Clerk of Court, Recorder of Mortgages or Department of Records. Nevertheless, regardless of the name the public offices all offer a convenient, central place for keeping deeds, titles and liens.
Basic Recording and Indexing Process
The statutes of each state establish the basic recording process for property records, particularly deeds, mortgages, liens, leases, easements, and court orders. That said failure to register a document of this type renders it invalid against purchasers for valuable consideration without awareness of their presence. Two of the general procedures for indexing instruments after recording include grantor-grantee indices and track indices. The grantor-grantee index creates a database based on the names of the persons conveying and those receiving the interest, including the filing dates of the papers. By way of contrast, a tract index requires that employees who record public property records make a determination of affected properties and list them by the legal description of that property, maintaining separate files for deeds and mortgages. Be that as it may, by using this protocol sparingly, costs, as well as the probability of error, decrease dramatically.
Attaching a lien notice to the property by filling it with the county public records office provides creditors with the opportunity to try to collect on a debt. By doing so, all liens against the property, including infractions, violations or delinquent taxes, show up when researching any holdings. Anyone can access and view public property records online or in person. A lien presents an unclear title, and to sell or refinance real property, the title must be clear. In order for a title to be deemed free of claims, all existing financial holds must be settled. Creditors have the option to request that a foreclosure sale to pay off the claim. Nevertheless, rather than forcing a foreclosure deal, many will usually wait for the property to sell on its own accord with the knowledge that buyers oftentimes will not purchase a property without a clear title. Therefore, the seller will apply a portion of the purchase price to repay the creditor to have the lien removed.
The creation of a deed occurs with recording a sale or conveyance of land from a grantor to the grantee. Under these circumstances, these general forms of public property records passing on real property from a seller to a buyer must contain certain essential elements in order to be considered legal. For instance, including the identification of the grantor and grantee along with an adequate description of the property renders the deed legal. As a result of this, distinct deeds grant a multitude of security layers to the grantee because the form of the deed explicitly circumscribes the duties and responsibilities of a grantor. In fact, by categorizing filed and recorded deeds in a number of different ways, warranty, quitclaim, and special purpose deeds establish and finalize the obligations of the buyer and the seller. A non-interested third party acting as a trustee holds the title until the repayment of the loan. The trustee, oftentimes an escrow company, facilitates foreclosure for non-payment of the loan.
In contrast to deeds, typically only two parties participate in mortgage transactions. Public property records, including deeds of trust ( mortgages), list the amount of money owed on the property. As an illustration, for real property sales transactions without full payment, a mortgage specifies the amount of money borrowed and from whom. In the end, filed and registered mortgages afford security for lenders as well as property owners. Consequently, just as soon as a mortgage company files a note, they assign a hold on the property, securing the repayment of the loan.
Title Searches and Establishing Chain of Title
A title search attempts to discover documentation by researching the parties listed on a registered deed. While different strategies oftentimes result in the same result, one strategy for conducting a comprehensive search begins by exploring the grantor directory in the County reports ascertaining the name of the original registered owner of the title. Thus, the goal of the search outlines and points to the original grant from the government to the primary grantee, typically in the form of a license or a patent.
The next step involves searching the name of the grantee in the grantor index to find the deed conveying the title. Repeating this step provides the discovery of all grants, linking the original to the current owner of the title. More importantly, claims or liens held against any of the parties display on public property records found through the process. Discovering numerous grants from the government requires using an alternative technique such as searching backward in the grantee index to yield desired results. Reverse searching begins with the name of the person or entity thought to own the land and then works backward to locate the original grantor. Repeating the process again confirms the source of that title, and so on until reaching the primary grant from the government. Either way, a discovery of the current grantee indicates the property record titleholder, while the connection between grantor and grantee establishes the chain of title.
Lawyers and title companies entrust property records for the authentication and validation of specifics of past and present ownership. On the whole, property ownership affidavits authorize and constitute the chain of title, clearly showing current and previous ownership. A break in the chain of the title indicates complications and places obstructions in the path of the title search process. The procedure of publicly documenting a legally binding agreement becomes vitally significant in the event that a deed, title, mortgage or lien gets misplaced, destroyed or stolen.