How Do I Find Missing Title Insurance Policy?

[Ibrahim Hughes]

Hi All. I'm purchasing a property where the old liens of the previous owners are still showing up as open. They should have been paid in full (and discharged of record) when my seller originally purchased the property since he took a huge first mortgage out ($389k) against the property with a major lender.

The deed shows the title agency who handled the transaction when the seller purchased the property. However, it looks like they are no longer in business. I'm assuming I will have to go to the actual underwriter/insurance company to get a copy? I'm also checking to see if he used an attorney who might have a copy.

Anyone got any other ideas as to how to get a copy of the title insurance policy? Might I be able to get a copy from the lender?

[Rick H.]

At the risk of becoming redundant on this thread, I'll tell a little story about about how title problems changed my life, even my lifestyle:

For the first 5 or 10 years in real estate I would occasionally stumble on a title problem, typically a judgment lien, and would frustrate me to no end. After all, wasn't this the title company's job to catch these things and "fix" them? In truth, in my early days I would buy properties based solely on a title profile, usually without a prelim or insurance, nor even a trip to the county recorder's office. And, candidly, they baffled me as to why title companies didn't catch them and provide them in the profile. I've paid for several $5,000 "training courses" in the form of missed liens that I ate. We did not have internet, so easy access to data was about twenty years in the future.

When I began lending in 1989 and focusing on probate estates I'd find lots of problems with title, largely due to the long time windows of ownership. About the same time, I perked up to title search related topics in the now-defunct John Beck Forced Sale Newsletter (long before he became known as a tax sale guy). I studied how documents are recorded and indexed, and how title companies use a parallel (but not identical) repository 'plant' system and why a profile does contain most liens, and what prelim are and what they are not.

I also studied in earnest how to not only spot these problems but the remedies. And then it hit me: title problems could be a GOOD thing! I realized that they weren't my problems unless or until I made them mine. Further, most home owners and real estate investors alike abhor any form of cloud on title. After all, anything that stands in the way of marketable (insurable) title stands in the way of a seller receiving money or other benefits.

Today, I've come to believe that what's bad is good and title problems, liens in particular, can be very profitable. Since I've assembled a pretty effective repertoire of tools, I'm not afraid of acquiring defective interests that others, if not most people, would run away from.

And here's the real kicker: I've made an incredible number of friends who I've made along the way because of mutual interest in spotting, assessing and resolving these title problems. Would have never expected that, too.