After 12+ months, titles are still no in our name (!!)

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After 12+ months, titles are still no in our name (!!)

Pixel Rogue
PA · Member since 2013 · 136 posts · 19 votes

We closed two properties at the end of 2019. We discovered that the deeds were never recorded in our name when we went on a hunt to locate school taxes. In August title company blames everyone else (including state website being down the day they went to record it) ~ they would have it fixed asap.  November 2020, still not fixed...now getting upset w/the title company (a company I used exclusively for years w/o problems, same agent.) ~ telling me we benefit because 'we have more time to pay the school tax' ~ what? We actually lost the discount rates AND remain at HUGE risk w/o having the titles recorded. Inquired again in December 2020. 

As of today titles are still not recorded and have lost all faith and patience w/the title company.

1) Where are the responsibilities of the unpaid taxes? We have paid the 'assessed' value taxes which are based on non-dwelling space as they were new construction units in builder's name. 
We have had tenants in each unit for a year now, tiny token tax bills because the units have not been recorded as completed and sold etc.

2) How does a customer turn up the pressure in a way that the title company will take notice and respond to prioritize and fix the issue? 

While both closings were nearly identical and same time frame, only one property recorded prepaid taxes which the title company mailed back (August 2020) and there was nothing collected for the second property.


3) We think informing the lender of the problem might help put pressure on the title company, however the lending company of of the most skittish we have ever dealt with and might take drastic measure such as recalling the mortgages or something crazy...what could a bank legally do if they learn the title has never actually been recorded in the name of the borrower? 

Thank you in advance for any insight....

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Bob NortonPro Member
Accountant · Slidell, LA · Member since 2019 · 382 posts · 272 votes
5y

@Pixel Rogue Did you purchase title insurance when you bought the properties?  You may be able to file a claim with them.

You could also go to the clerk of court and record the deeds yourself.  You may have to stop by the title company and pick up the originals, if you do not have them.

You could also hire another lawyer to sue the title company into action.  Plus, you can include in your claim any late penalties on the property taxes.

And, you need to check the title records to see what has been filed against the property since you purchased it.  There could be other liens filed against the property that are not yours.

Discuss this with a real estate attorney to determine your next best steps.

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  • Bob NortonPro Member
    Accountant · Slidell, LA · Member since 2019 · 382 posts · 272 votes
    5y

    @Pixel Rogue Did you purchase title insurance when you bought the properties?  You may be able to file a claim with them.

    You could also go to the clerk of court and record the deeds yourself.  You may have to stop by the title company and pick up the originals, if you do not have them.

    You could also hire another lawyer to sue the title company into action.  Plus, you can include in your claim any late penalties on the property taxes.

    And, you need to check the title records to see what has been filed against the property since you purchased it.  There could be other liens filed against the property that are not yours.

    Discuss this with a real estate attorney to determine your next best steps.

    1Reply
  • Steve Morris
    Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
    5y

    Is there any reason why not?  Unless it's pretty obvious, you need to make a claim on the title insurance and probably let the state insurance commissioner (at that's who in OR) know to "turn up the heat".

    0Reply
  • Peter Walther
    Specialist · Winter Springs, FL · Member since 2009 · 1k+ posts · 747 votes
    5y

    Assuming you received a title commitment commitment prior to closing and paid for a policy at closing, contact the title underwriter immediately.  There have been occasions where an agent has been canceled by the underwriter but has continued to issue commitments and policies and since the agent is no longer authorized to issue them, there probably would be no coverage.  Assuming the mortgage wasn't recorded either, the lender would be able to bring additional pressure to bear.  Lastly, you might want to have someone confirm any mortgages owed by your seller have been satisfied of record.  I've seen cases such as you've described where the prior mortgage never got paid off and remained a lien on the property.  In a worse case, if the prior mortgage wasn't paid off and the monthly payments weren't made the lender could be foreclosing and you wouldn't know because you don't have an interest of record.  You might want to talk with a good real estate attorney about filing a suit to establish your interest of record along with a Lis Pendens.  I'd move quickly because every day increases the possibility of a problem.  I'm not an attorney and this isn't legal advice, just someone with years of experience cleaning up title problems.

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  • Nathaniel Walker
    Investor · USA · Member since 2017 · 93 posts · 71 votes
    5y

    I had a similar problem that the closing company found 7 days after I closed but never told me until I tried to sell the property 3 years later. During that time they said they were working on it. The issue took 7 years to resolve with title insurance.  I was told that the title company was going to litigate it and it would take as long as it took which was 4 years. 

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  • Pixel Rogue
    OP
    PA · Member since 2013 · 136 posts · 19 votes
    5y

    Thank you everyone.... Yes, think there was title insurance purchased albeit did not pay much attention never dreaming something like this would happen.

    Hate the thought of bringing in a lawyer w/additional costs (these were costly investments already) ~ yet this is what I see as needed.

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  • Peter Walther
    Specialist · Winter Springs, FL · Member since 2009 · 1k+ posts · 747 votes
    5y
    Originally posted by @Nathaniel Walker:

    I had a similar problem that the closing company found 7 days after I closed but never told me until I tried to sell the property 3 years later. During that time they said they were working on it. The issue took 7 years to resolve with title insurance.  I was told that the title company was going to litigate it and it would take as long as it took which was 4 years. 

    It's possible the defect was found before closing but wasn't mentioned because the title agent/underwriter thought it might just go away with time.

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  • Pixel Rogue
    OP
    PA · Member since 2013 · 136 posts · 19 votes
    5y

    Finally resolved. Required shaking trees at all areas from tax collectors to recorder of deeds and title company....each blaming issues on Covid + each 'other' area. 

    This was the job of the title company and they did not do enough and requests for refund are being ignored. Insane. 

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  • Clint Votruba
    Member since 2019 · 92 posts · 56 votes
    5y

    "This was the job of the title company and they did not do enough and requests for refund are being ignored."

    IF you were eventually made whole (even though it took a WHOLE YEAR), the title company could/would argue that you are not due any money.

    Moreover, the title company will argue that since you were give an Owner's Policy, you were never at risk in the first place 

    However, the title company is an INSURANCE COMPANY and IF they had a legal/ethical obligation to pay something on time etc. and they didn't but could/should have, their conduct could/should be reviewed.

    Title insurance companies are licensed by the State licensing bureau of each State and there are procedures to follow if you want to file a Complaint against the title company.

    Personally, IF the title company "dropped the ball" and it caused you concern etc, you could make an argument that a refund of at least a portion of the Escrow Closing Fee you paid at closing is fair.

    Good luck.

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  • Clint Votruba
    Member since 2019 · 92 posts · 56 votes
    5y

    Also, the fact that the title to the property was not in your name after 12 months is pretty outgrageous and should be reviewed by the State.

    0Reply
  • Pixel Rogue
    OP
    PA · Member since 2013 · 136 posts · 19 votes
    5y

    As of this morning the tax office still had nothing. The office investigated and did find a page/title for the properties recorded in February. Had the title company at least made an effort to proactively communicate once or twice a week (even a month) this would have been better but they ignored us straight through. Haven’t heard from them since August 2020. 

    Closed two properties in November 2019.
    Title got recorded February 2021.

    Unacceptable. 

    0Reply
  • Pixel Rogue
    OP
    PA · Member since 2013 · 136 posts · 19 votes
    5y
    Originally posted by @Clint Votruba:

    Also, the fact that the title to the property was not in your name after 12 months is pretty outgrageous and should be reviewed by the State.

    What would be the process to imitate such a review? 

    0Reply
  • Clint Votruba
    Member since 2019 · 92 posts · 56 votes
    5y

    I found a link for the State of Pennsylvania Insurance Department here File a Complaint (pa.gov)

    When filing the Complaint, try not to use terms like "incompetent" or "liars" etc.

    Just give them the facts and stress that failing to put you into title etc. was not right

    and

    tell them you want to know why this happened and tell them you want the department to make sure it doesn't happen again.

    Good luck. 

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