Richard;
About that "Title Company". Are you sure you contacted the title insurance company or the title AGENT who conducted the closing? If so, the lady you spoke to is blowing smoke.
Find what Title Company (Underwriter) insured the deal and contact them by having your attorney mail a formal claim. CC the lender and make sure you let them know their lien is not in the first lien position.
I honestly think you spoke to an agent instead of the Insurer.
PS: No one needs an "okay" from a developer, homeowner, lender or anyone. She's avoiding the situation because she knows Mechanics liens have a very limited statute. Don't foreclose. Waste is time and waste of money. Lawyers will eat up the entire amount. The company you litigate is the actual insurer. Let me know which state this is in and once you know which title insurance insured the parcel, let me know and I'll throw some phone numbers your way.