Robert,
In California, when you have an outstanding Mortgage/Deed of Trust that hasn't been Released/Satisfied/or Reconveyed in the County records, and you've exhausted all possible research resources, (tried contacting the lender, searched the grantor/grantee indexes, etc., etc., the borrower, or the owner of record obtains a Lost Instrument Bond from a Surety/Bond company.  They usually charge based upon 1 1/2 times the amount of the original loan.  Then an Affidavit is recorded informing the public records of this mortgage being intended to be Released/or Satisfied of record and must be of record for 30 days prior to actually having a Release or Satis. or Reconveyance recorded for the "Stale dated mortgage/deed of trust".  OR,  you can make a underwriting decision/and not show it, only if, and if you're a very experienced title examiner, only if you absolutely think it's been paid and or satisfied and no longer a valid loan against the property in question.