How Accurate are the Banks and The Clerks Office?

[Gail Gates]

As an information provider, I hear stories and field questions from investors of all levels of experience. In the last twenty-four hours I heard two stories from different clients regarding inaccurate information from two major banking institutions and a clerk in the courthouse who deals with foreclosure sales everyday. The investors were extremely upset during both exchanges. Valuable time was wasted in both cases.

The first, a new investor, their first house. It was so exciting when they called to tell me they got the property they wanted at the Foreclosure Auction in the courthouse. They gave the deposit and returned before 2:00 with the balance. They were issued a certificate of sale. The clerk advised them when they could return to get their title. The thrill of your first purchase is like your first kiss. Soon the thrill was gone when they return to pick up the title. The clerk informs them that there was an issue with the name on the title and they had to send it back to bank. The clerk continued by saying they would have to contact the bank for more details. The clerk supplied the telephone number and name of the person to contact.

The assistant for the contact person advised that there would be no title issued because the property was in fact scheduled to be sold in the courthouse. The assistant further instructed the new investors to contact the banks attorney of record. The attorney said they weren't representing the bank in that case number or property. They called a real estate attorney to assist them who advised it would take at least two to three hours to investigate the problem (hishourly rate x's 3). Then it would be additional if it needed to be litigated. That seemed fair but a huge expense that could potentially eat into their profit.

After hearing about the run-around I looked up the court docket. The property was sold to my client. Their name was correct on the docket and there was no record of a pending sale. Stay tuned.....

Meanwhile, I receive a call from another investor who was inquiring about a property that had been sold at the foreclosure auction. It went back to the plaintiff, the bank in this case. They were interested in the property and noticed a cleaning crew was working at the location. They were told it was being prepared to be put on the market. They thought this would be the perfect time to contact the REO department to make an offer. In this case they were advised that the bank did not own the property, that they did not foreclosure on the property and had no record of ever having a mortgage on it.

In both cases the investors had been totally misinformed. The second property was easy enough to prove. I checked my website for the address and case number to confirm the bank in question was the plaintiff. Then I looked at the property appraiser site where I confirmed it was owned by the bank in question as suspected. To be absolutely certain, I checked the county comptrollers site and found the certificate of title that had been issued to the bank. With the documentation the investor was able to go back to the bank and make and an offer.

The first property with the title problem turned out to be an even simpler answer when I asked the right person, a seasoned investor and long time customer/friend. As soon as I explained the problem he informed me that the clerk no longer issues the title. You, the investor, need to prepare the title and bring it to the clerk. They will collect the doc stamps, record the title and you will get a copy with the recording information stamped and signed by the deputy clerk of court. It is still unclear why the clerk said there was a problem with the name on the title. 22 days wasted because of bad information.

Lastly, the banks! Seriously? In both cases their information was totally inaccurate.