Assignments, reconveyances and title issues are a constant challenge for mortgage servicers. They must check to make sure title and lien records are accurate, make changes on a timely basis when loans change hands or pay off, and be mindful of different rules and deadlines in each state. Whether boarding new loans or recording payoffs of old ones, servicers are always in a race against time as deadlines for recording loom.
If you think making those deadlines is no big deal, just think about some of the servicers in years past who faced class-action lawsuits as a result of an alleged failure to record releases on time. Lien release issues are not in the spotlight today, but that doesn't mean aggressive attorneys won't exploit this issue again in the future.
Fortunately, technology is able to help lenders manage title issues more efficiently than in the past. While the nation's 3,500-plus recording jurisdictions, mostly county governments, continue to have a panoply of rules and procedures, an increased number of them have embraced electronic property recording procedures and communication. That has made it easier to track and change title records, though much progress is yet to be made. Still, lenders have been embracing technology such as imaging and digital documents in ways that should take some of the headaches out of the lien release, reconveyance and title management process in the future. MERS, the electronic registry for tracking ownership of mortgages and servicing rights, has helped push forward the frontiers of electronic management of title and related issues.
Few hurdles are as challenging for services as "trailing documents," which often relate to title issues involving a loan in their portfolio. Electronic commerce can help lenders minimize those headaches going forward. (c) 2008 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com/ http://www.sourcemedia.com/