What Homeowners Should Know About Foreclosure and Title Companies

Those who want information about a distressed property, a vacant lot, a condominium or apartment can visit the local Clerk and Recorder’s Office and look at the records pertaining to the foreclosed property.

Banks, mortgage lenders or any individual for that matter could find out who holds the mortgage on the repossessed home, who owns the property, liens on the home and the homeowners associations’ (HOA) rules and regulations covering the property.

Any pertinent information about the foreclosed property can be learned from public records. However, despite the availability of public records on a certain property at the Clerk and Recorder’s Office, majority of the people who are interested to learn about the property failed to do so because of lack of time.

An alternative is to hire title companies. Title companies can do the checking of records for you. Usually, a title company has its own computer system that is designed to gather and provide information about a particular foreclosed property.

A title company has a foreclosure department tasked to check public records on foreclosed homes upon request of banks or lenders.

Foreclosure does not only affect homeowners but also lenders, may they be first or second. Just like homeowners who will lose their properties, lenders are also entitled to receive a notice of foreclosure.

Now, why should a notice be sent to the lender who holds a second mortgage loan on the property? For example, you applied for a loan to purchase your home in 2004. In 2006, you decided to get a second mortgage loan on your property because you needed money. The first lender does not know that you applied and received a second loan.

When the first mortgage lender takes back the property, the second mortgage lender will immediately lose his trust deed on your debt.

That is why most lenders hire title companies to know all information on the public record after their deed of trust was recorded.

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