By Gary J. Bowers, Attorney
There is no doubt that technology and modern conveniences touch almost every aspect of our lives. The modern day consumer can purchase almost anything online, and with regard to a real estate loan closing our television promotes how easy it is to apply for a loan online or to close on your loan “faster than a speeding bullet.” At what point must the consumer ask the question, “What quality is being compromised for the sake of instantaneous gratification?”
We suggest that real estate closings, loan closings and particularly title examinations involved in assuring those acquiring real estate are not to be compromised for the sake of speed and desire to be finished. Speed is not always synonymous with quality and correctness.
In my years practicing law in North Carolina, and my years prior to practice assisting attorneys with real estate closings and completing title searches, I have encountered both simple title examinations and extremely complex title examinations. The complexity of the title exam does not discriminate due to the amount of the purchase price, whether it is a cash closing or financed through a loan. Despite the fact that many counties have conveniently provided public records for searching on the internet, every title is different and the time is different. This can be taken for granted by the seller, the realtor, the lender, the buyer, attorneys that do not engage in many real estate transactions, and by your friend who had a transaction that went smoothly in the past.
For a title searcher with the goal of performing their task correctly, his or her goal going in is to leave nothing assumed or speculated, thoroughly check the record by reading all documents in the prior chain of ownership and identifying the relevant documents. If a title searcher takes this approach every time, it is inevitable that errors will be found over the course of multiple searches. Finding errors in the execution of prior recorded documents, in the legal descriptions describing the subject real estate, and in the administration of an estate in the chain of title can avoid much greater costs and time consumption for the client down the road. Also, there may be judgments and other liens affecting title that landowners just assumed did not apply to their real estate. Ultimately, this is why attorneys recommend title searches and why they cannot be wrapped and sold to the consumer as being quick, cheap, and easy.
Nonetheless, attorneys will always have clients that are insistent that a title search will be easy, but it is a fact that the attorney properly protecting your interest cannot take your word, your brother’s word, the prior landowner’s or any other person for that matter. For the sake of the client, a thorough attorney may take more time than desired but will either assist the client in getting into a piece of real estate free and clear or knowing to stay away from a transaction because of the problems found before closing.
If there are problems to be corrected with a title to real estate, then attorney and client must be clear that all timetables are out the window. These problems to be corrected often involve outside parties that will need to cooperate and be coordinated for signatures, and they likely do not have the same incentive to close quickly as the buyer, borrower, seller, realtor, attorney or lender would. Often, the outside party can hold an ownership interest that was overlooked in the past, a judgment creditor being asked to renegotiate and settle for a lesser amount, or a prior seller being asked to come back in and correct the signature and notarization on a prior recorded instrument that was incorrectly executed. All this being said, one must account for the time it takes to locate some of these outside parties, and what if one such party is now deceased since the error occurred? Talk about added complexity!
Essentially, each title exam will present its own challenges and complications. However, we as consumers cannot simply be sold on the idea that the title can be checked quickly or that their real estate transaction is destined to occur fast and conveniently just because two parties have agreed to buy and sell. It is most important that the consumer prioritize that what is often their largest investment be handled correctly. Most of the time, they will find that the attorney will offer every convenience possible to finalize the transaction in a timely manner as well.
Now, after reading my thoughts on technology and the speed of consumer transactions, your assumption may be that I am opposed to change or progress and am one of those nostalgic attorneys longing for days gone by. That is not the impression I wish to leave. Yet, despite the benefit and progress of the technology, the internet, email and the server at my office has created speed and convenience for my clients, but none have located an incorrectly completed notary certificate in the chain of title, identified an easement severely encumbering a piece of property, and never accounted for all the heirs or devisees of a deceased person required to sign off on a real estate or loan transaction. In fact most estate filings in North Carolina are still in hard copy for review by attorneys at the local Office of the Clerk of Court. So remember, speed and convenience cannot serve as a substitute for quality work performed by your attorney in your real estate and loan transactions.