Rejected documents from the county recorder create time delays and decreased efficiencies add up to a cost of billions for the industry with the burden of this cost falling on the current holder(s) of the note. The process of preparing corrections, transporting and re-recording documents will cause double, sometimes triple, the work for employees of those firms.
The ripple effects of correcting these title chains lead to other costs associated with delayed foreclosures and sale of loans. If the chain cannot be corrected to prove who the lender of record is, the investor must then look at proceeding with a quiet title suit, which adds attorney fees, trial cost and time.
Fannie Mae has mandated all assignments must be recorded and chain of title verified before the loan can be referred to a foreclosure attorney. This may well be the trend that other servicers/investors will follow in the near future.
With the ever-changing guidelines for such ownership tracking, “getting it right” the first time is even more important. Accurate and reliable recordation of assignments and lien releases is vital to establishing the chain-of-title and decreases the chance of putting ownership security in jeopardy.
