I deal with registered land titles all the time & I can't begin to tell you how many mistakes I find in their records (& record keeping).  It's the same old story of garbage in = garbage out. 

One example - just one of many - I found an Order of Notice to foreclose against John Doe against his name in the grantee index (rather than in the grantor index which is where it belonged).  I called the Land Court office to report the error (knowing that this was the Registered Land department I believed that they demanded perfection in their records) & the clerk hung up on me.  I called back & was told to mind my own business & "Well you found it didn't you?  What's the problem??".    OK then.  One more example - I had a commercial deal that was somewhat complex.  I went through three different clerks & each one had a different set of requirements, all for the same set of papers.  Registered Land should be abolished.

Here is the section of HR6460 which authorizes the study. 

SEC. 3. HUD STUDY.

(a) Study- The Secretary of Housing and Urban Development, in consultation with the Comptroller General of the United States, shall conduct a study to analyze and determine--

(1) the impacts of the lack of electronic records and uniform standards found in local land title recordation systems currently used in the various States;

(2) any progress States have made in developing electronic land title recordation systems for their localities that contain uniform standards, and any findings and conclusions and best practices resulting from such development;

(3) the current oversight role of the Federal Government in the transfer and recordation of land titles;

(4) opportunities, and the feasibility of such opportunities, that may be present to leverage progress made by some States and localities to create an electronic land title recordation system, including through--

(A) a system that would maintain all previous records of the land-property without invalidating, interfering with, or preempting State real property law governing the transfer and perfection of land title; and

(B) further actions by the States or by the Federal Government, or coordinated actions of both; and

(5) the feasibility of creating a Federal land title recordation system for property transfers that would maintain all previous records of the land-property without invalidating, interfering with, or preempting State real property law governing the transfer and perfection of land title.

(b) Report- Not later than the expiration of the 12-month period beginning on the date of the enactment of this Act, the Secretary of Housing and Urban Development, in consultation with the Comptroller General of the United States, shall submit to the Congress a report on the results and findings of the study conducted under this section.

I could definitely support at least some of this study.  From what I have seen, which is admittedly not nearly as much as you guys have, the current land title recordation system is antiquated, clunky, costly, prone to data loss (as we have recently seen in New Orleans), and almost completely free of any kind of useful standardization. A study to determine some best practices and an effort to come up with some uniform standards could be very helpful in paving the way for improvements.

As I have opined before, I believe that it makes sense for counties to share resources.  It makes no sense to me that county recorders, many of them probably not all that technically savvy, are being tasked with reinventing the wheel 3100 times over-- each one independently having to climb the learning curve to implement modern electronic systems in their offices.  I recall posting an article a couple months ago about a county recorder in Indiana who had just proudly announced the unveiling of an electronic recording system-- after several YEARS of work getting it up.  I'm sure the county recorder learned a lot from mistakes made during those years of implementation and testing, but of what benefit is that knowledge if other counties can't benefit from what was learned? 

I do like the Torrens title system in principle from what I have read of it, and I had looked into how the Australian Torrens system operates awhile back.  It's important to note that jurisdictions with well established Torrens title systems like Australia are in no way interested in reverting to a system like ours, and the paper Charlene linked to explicitly says that.  My opinion is that if you were building a land title system from scratch, a Torrens system would be superior to our system in many ways.  But I think a study here would probably determine that implementing such a system wouldn't be feasible here-- especially if you were carefully trying to do so without treading on any state laws. One main problem I'd envision is that the people who have the expertise to actually accomplish such an ambitious transition run businesses that would be made obsolete if Torrens were adopted, and so they will generally be opposed to eliminating that system and understandably so.  So I don't think the study would be that much of a threat in that regard. 

And it is of course just a study.  I'd be interested to see what ideas such a study came up with, assuming that the study was conducted by folks with a clue.

and I can't find the bill you are referring to.

http://www.govtrack.us/congress/billtext.xpd?bill=h111-6460

I pasted the relevant section of the bill in my comment above. The main part of the bill prohibits Fannie and Freddie from buying MERS mortgages.

I apologize if I got the sponsor's name wrong.  Thanks for the correction.

Is ALTA really opposed to this bill because it calls for a study of (not an enactment of) a federal land title system, or because it would essentially abolish MERS.  The heart of this bill prohibits Fannie Mae, Freddie Mac, and Ginnie Mae from having anything to do with MERS mortgages.  The federal land title system section is just a study of its feasibility.  (See House Bill Could Spell the End for MERS).

Personally - I would support this bill!  I would love to see lenders actually recording assignments in the county records, as they should.  Under this bill, within six month, MERS would have to file assignments back to the real holder of the note.  That sounds pretty darn good to me.

I think ALTA might have mixed motives here.  I agree that a federal land title system is a very bad idea - but I have no problem with the study.  It might actually provide some useful information the counties could use to standardize some aspects of their recordation system.

Best,
Robert A. Franco
SOURCE OF TITLE

I would like to hear the argument for "why a federal land title system" would be a bad idea. I think it has merit and would eliminate many of the bottle-necks and anti-competitive forces at play.

I'm sure one reason ALTA is against this is title plant valuations will go south. Anyone with a proprietary basis in land records doesn't want to see that interest dissolved by a federal trump card.

But we must look past the local basis upon which we have been keeping land records and realize there are legitimate aspects to having a "single recordation point".

Assume for a moment we could retrograde other indexes to a system akin to our land title structure. Would anyone really want to have drivers' licenses, aircraft title records, UCC filings, corporate records, etc. placed in a system of similar construct as our land title systems?

I certainly don't read any sinister motive to develop a Federal Torrens System based upon a study. This is stretching to achieve a first strike against any consideration of examining our current recording methods.

One has to acknowledge that many jurisdictions are at the mercy of those with title plants indexed geographically. Suppose you had state license plate indexes such that one would have to search by car to find the license number of the vehicle??? Peruse all the Nissan Maximas to see which one corresponds to a particular plate number from which you could then glean the name and address info. It would be absurd!!

I think it's legitimate that Hertz, Avis or any other car rental company may access the drivers' license database of a state to determine the status and record of the driver they are renting to. We certainly have nothing of this sort with land records.  Can you imagine how encumbered it would be if these rental car companies had to send out for a manual search that would take days? Rental car commerce would cease!!

I think we all need to consider that evolving technological implementations create new avenues of commerce! 

I'm in Pennsylvania.  Perhaps it is my lack of understanding of the western Title Plant system, but I'm not really seeing much of a difference between how land title in PA works compared to a Torrens System other than scale.

However, I can comment on scale and government bureaucracy.  The last thing I want to see is another monsterous federal bureaucracy that drains our resources, creates waste, and steps on the rights of states and individuals.  A federal registration system would also wreck havoc on the jobs of small, local, independant title searchers and agents - as if they aren't already fighting an up hill battle to stay in business.

As to sharing of resources between counties and not reinventing the wheel, I completely agree.  And so do the county recorders which is why there are Associations of Recorders of Deeds in many states, including my own.  They do work together and share ideas and resources.  In fact, in Pennsylvania they have even issued standardized recording requirements - not because of some government study and mandates,  but because it made good sense.

If we as a country stopped looking to the government to solve all of our problems, we'd start talking to each other and actually get some solutions that work.

  Cheryl is right.  Why not then have the Fed step in and nationalize the title companies, take their records and merge them into a big fat Torrens system:  only change needed is the label, so printing cost of new stickers can be outsourced to India..... OH WAIT, India already has all this data, so why doesn't the government just nationalize India and call it "NEW TEXAS" or something snappy?

  The murder of private industry, local control, and individual rights continues in our society.

  What a way for a free market Repblic to die. 

My sentiments are with Franco's viewpoint, as usual, but the matter is simpler than the comments indicate: Federalsim and Separation of Powers will prohibit any attempt by Congress to impose a "national" system that would reorganize or replace the 3,000 or so County, Parish and Recording Districts and the state laws that enable them. Likewise, no effort to "streamline" the law of recordable documents would withstand a challenge. As support for this position, I like the Fields dissent in Baltimore & Ohio, 149 U.S. 368, 401 (1893).

There may be some who think that the Department of Interior, BLM records system (in the Public Land states) could be easily adapted to cover the current states' systems. They are wrong.

My opinion is that someone is looking for cover in this study. FNMA and FHLMC would face diffiulty discarding MERS without some appearance of a "process". Those two largest proponents of MERS  made a mistake in the first place. Stewart Title and ALTA also provided misguided support MERS in its infancy. It will be amusing to hear the storm of testimony this "study" will certainly attract.

Keep the Faith.

Lacombe

"Federalsim (sic) and Separation of Powers will prohibit any attempt by Congress to impose a "national" system ..."

Banks, Eminent Domain (Kelo v. City of New London) and the General Welfare Clause ring any bells?!?!

Remember school bussing and most recently "No Child Left Behind"? The Department of Education basically runs "state" education systems.

Is there a Uniform Recording Act in our future?

------------------------------------------

The true test is, whether the object be of a local character, and local use; or, whether it be of general benefit to the states. If it be purely local, congress cannot constitutionally appropriate money for the object. But, if the benefit be general, it matters not, whether in point of locality it be in one state, or several; whether it be of large, or of small extent.

I like the point of view you have in your "let's explore ideas" post.  It pretty much sums up my view of the current recordation system-- and why it is hard to defend. 

If title professionals just oppose any and all change to the current system, they will simply be left out of the discussion.

Slade,

You're on the money with "title professionals" being left out of the discussion. ALTA has issued a "Grassroots Advocacy" under the guise of "Protect the property recording system of the US!". I would be curious to know of any "discussion" within any group of the ALTA membership to advance this position?? Or even an intelligent argument why this position! ALTA certainly didn't poll anyone!!

ALTA is just an old dinosaur! It really doesn't advance any ideas or generate any enthusiasm. As it is with many who can't imagine a better future!

The issue I believe is coming to the fore as a result of loan securitization. Leaving aside the foreclosure debacle, packaging loans from different jurisdictions into varying tranches of risk is a pretty clever idea. Granted, the first iteration of this process ended terribly, undermined by the underwriting lapses (and even fraud) but it doesn't discharge the fact that loan securitization is a financial construct which provides private debt placement options which would not be available otherwise.

And until humankind conceives some other system of "money", debt instruments and their trading movement amongst parties will be ever evolving.

The mortgage loan industry is essentially a department of the US Treasury as it now stands. Most (nearly all) institutional mortgage loans are sold into the secondary market of FHA, Freddie and Fannie. How to redefine the goverment's role in housing will be ongoing for some time. And we've certainly enabled these institutions via government backstops and guarantees. Loan securitization is a needed financial architecture.

It you're sitting within any of these institutions and have hundreds of thousands of loans to manage the current recording system has to give you nightmares!! Forget the forclosure melieu -- it is a paperwork quandary to verify and confirm proper movements of the mortgagees' positions!!

So we basically have a home loan finacial framework which has, as many conceive, a very real obstacle to its function with the current recording system.

Some seem to believe Federalism will somehow be trumped and state's rights would prevail should the Feds attempt a handle on the recording system. But we all know the big gamble here.

Remember that the State of Georgia passed "predatory lender" legislation only to find that loans made thereunder would be excluded from securitization pools as the rating agencies would refuse to rate the pool thereby undermining a sale of the loan into the secondary market. They didn't even need legislation!!!

And anyone keeping up with "nullification" trends as originally conceived by Thomas Jefferson quickly realizes that his concerns of a federal system ruling in controversies of federal and state issues must necessarily create a federal bias!

One can imagine the Feds could simply do a form of MERS where all federally related mortgages (same definition as HUD origination with an FDIC institution) must be recorded in some federally created registry and further such mortgage or deed of trust would be insured against any loss from failure of its first lien status. It wouldn't be much of a jump that a new title recording system would be born from such!

But the larger issue is that we can conceive and implement a recording system much better than the one we have. And it can be made pliable and futuristic to the extent that it would accomodate a dynamic and evolving financial system.

Imagine the early settlers of America unaware of this magic, invisible power of electricity which someday would be available on demand!! Suppose our Navy was fighting sea wars under oar rather than with nuclear subs!! Douglas MacArthur's father, Arthur MacArthur, was fighting Indians on the western plains with winchester rifles -- Douglas watches the unleashing of the nuclear weapon!!

The Feds aren't always incompetent! Look at NASA and space exploration (I would like to see any state build the Space Shuttle!!). The National Park System is pretty good in my opinion. Air Traffic Control with the airlines is the best in the world.

It is inconceivable to me that with immediate capacities such as Google Maps, XML documents and an ever greater capacity to pass ideas and knowledge instantaneously there are those among us who would foreclose upon the discussions of a greater and better world!!

------------------------------------------------------

Thomas Jefferson

"The States can best govern our home concerns and the general government our foreign ones. I wish, therefore...never to see all offices transferred to Washington, where, further withdrawn from the eyes of the people, they may more secretly be bought and sold at market."

 ------------------------------------------------------

Joseph Story - youngest Supreme Court Justice ever appointed at 32 years old:

"...National notaries, public and national justices of the peace of the commercial and national concerns of the United States. By such enlarged and liberal institutions the government of the United States will be endeared to the people and the factions of the great states will be rendered harmless.

Let us prevent the possibility of a division by creating great national interests which shall bind us in an indissoluble chain." 

Perhaps ALTA needs some schooling from folks such as yourself as to what the definition of "Grassroots" is.  A pretty good description of what "Grassroots" really means can be found on Wikipedia:

A grassroots movement ... is one driven by the politics of a community. The term implies that the creation of the movement and the group supporting it are natural and spontaneous, highlighting the differences between this and a movement that is orchestrated by traditional power structures.

As you point out, there is no real "natural and spontaneous" movement from the broad community of title professionals to oppose this bill.  In fact, most title professionals seem to be quite open to at least some of the provisions in the bill, particularly the part that would ban the MERS mortgage on federally sponsored loans and force banks to record mortgage assignments at the courthouse. 

No, in fact, this "movement" is pretty clearly orchestrated by the traditional power structure-- the exact opposite of a grassroots movement.  The decision on the official stance on the bill is coming from ALTA's political department, which is trying to tell the industry what it should think about this bill.  It should be just the opposite-- the industry should be telling ALTA what it thinks about this bill.  ALTA is correct to inform its members about the bill, but you are exactly right-- there should be a broad discussion of the bill, and that evidently did not take place here.

The National Association of Independent Land Title Agents has already come out with a paper in qualified support of the bill which seems to more closely represent the consensus of this community.  NAILTA was founded by like-minded independent title agent who have been frustrated precisely because ALTA has not been responsive to the grassroots of the title industry.  Perhaps the answer is to support organizations like this that will better reflect the views of their members.