Getting a Land Titles Search – The Dollars and Cents

The question has often come up whether or not a mortgage broker should absorb the expense of a land titles search (also referred to as a property title search) to verify what’s on the title to a home that is being refinanced by a client.

First of all, a property or land title search is something that real estate lawyers sometimes perform in the course of a real estate closing. This was more common before the days of property title insurance.

When mortgage brokers or agents refer to a property or land titles search, they are often referring to a Parcel Register, which is a document that can be retrieved from the Province of Ontario Land Registry System (POLARIS). It indicates who the legal homeowners of a property are, when they bought the property, what they paid for it, any mortgages registered against the property, etc.

If you are a mortgage broker or agent then you know that this information is very important.

Among the most common reasons that deals implode, non-disclosure on the part of the borrower is one of the biggest. When your customer fails to disclose information to you that causes the deal to be cancelled later in the process, this can be costly to not only you, but all those involved.

Depending on how far in the process you are, the result can be your time wasted and your lender’s time wasted. If an insurer is involved, their time will have been wasted, the real estate lawyer’s time will have been wasted – the expense related to a deal that goes bad as a result of non-disclosure is significant.

What kind of non-disclosure are we talking about?

o   Other parties on title

o   Undisclosed mortgages on title

o   Mortgages that are greater than disclosed

o   Discrepancies with value – property was purchased very recently for much less than the value being stated, etc.

While learning this information early in the application process can save you expense, you don’t need to obtain a Parcel Register to verify this information.

You can access the same application that lenders use and verify not only who the homeowner is and the mortgages registered on title, you can also review an automated property value to further validate if the information your client has provided is accurate.

It pays big time to validate who the legal homeowner is and any mortgages registered. Doing extra due diligence leads to increased time savings, savings on expenses, closure rates and strengthened lender relationships.

If you are a mortgage broker or agent and would like more information about how you can validate who owns a property or what mortgages they have registered please visit www.purview.ca/lenders or call 1-855-787-8439.