Tuesday, September 23, 2014

Electronic recording is coming to Baltimore County, Maryland.

Maybe.  Well, most likely.

The Request for Proposal issued by Baltimore County describes the project this way:
SCOPE: Deeds, deeds of trust, mortgages and releases will be the first documents to be accepted (approximately 700,000 per year); others will be added over time based on complexity and volume.

The system requires a customized workflow to mimic the existing paper workflow. When Title Companies, Bankers and Lenders create Land Record paperwork to document a purchase, sale, transfer, mortgage, loan or release, information to create the paperwork is researched using several on-line sources, including SDAT for tax information and ELROI and MDlandrec for title searches.
The “package” is approved by the industry parties and the journey to public recordation begins. Documents must be presented to the county Finance Office for clearance that outstanding debt is satisfied before the transaction can be recorded. Once approved, the document travels to the local Courthouse and is presented along with funding to the Clerk of the Court to be reviewed and filed as permanent record. Once accepted by recording staff, the document is processed using the ELROI system, which includes scanning, indexing and verification of each document. Once verified by staff, document images are sent to the Maryland State Archives for permanent preservation and public access; SDAT receives newly filed documents with which to update their systems.

The selection, customization and implementation of an eRecording system will be generally based on seamless integration and easy conformance with existing system and procedures, which are many. The Contractor will work with the existing contractors and related agencies as needed.

The system will accept specific document types and emulate the current paper workflow.

APPROACH: Based on research and interviews, our approach is to duplicate the paper process and use technology to enhance and strengthen process integrity and data.
Legal professionals are currently being polled to share opinions on the project.  I've excerpted some of the opinions that are flying around the local listserves, below. Many lawyers and title company professionals welcome e-filing, citing to the majority of jurisdictions that accept title documents that are filed electronically:
The trend nationally is towards Electronic Recording.  Presently there are approximately 1184 Counties accepting E Recordings nationally.  That number will grow.  At the moment, you can E Record in all of DE; 28 Counties in PA; 15 Counties in VA and 18 Counties in NJ...only 5 other states, other than MD, ....do not offer any E Recording: KY, RI, SD, VT and WV.
The elders of our profession embrace the new technology because it is inevitable:
 I've been doing this for 31 years and often been called an old curmudgeon for the way I insist things be done (the "right" way).  But I embrace technology, and the online land and plat records have made my practice immeasurably more efficient.  E-Recording is here, and I embrace that as well.  While I want to see what safeguards are put in place to guard our precious land records, there are significant efficiency benefits all around and this is the way it will be in the future -- hopefully sooner than later.

Others believe the change is long overdue:
 Great idea!  I know everyone is afraid of it but, over 40 counties in FL use e-recording and it works. ...As my old property law professor told me about 35 years ago,  “the law helps those who help themselves, generally the vigilant, rarely the sleeping and never the acquiescent.“
A common theme among all age groups is the relative inefficiency of current manual recording, which requires disparate county offices to process documents:
The whole process of going to different governmental offices, getting stamps and waiting for physical documents to be mailed back from Land Records seems quite inefficient in this day and age.
The truly dedicated recall that electronic recording once was a priority in Maryland, but it has been shelved for many years:
 E-recording, in one form or another, has been around since the  late 1990’s in Northern Virginia and, more recently in the District of Columbia.  The Maryland Legislature provided for an e-recording pilot project in 2006, but then allowed it to backwater.  While it backwatered, precious resources that could have been used for the project were diverted from Maryland’s Land Record Improvement Fund and individuals familiar with both the land records systems and the concept of electronic recording were lost to retirement. 
The CFPB, which has been overhauling the nation’s settlement process, has made nationwide electronic recording one of it’s goals.The AOC has once again picked up the banner of e-recording and is moving forward. 
The Maryland Land Title Association is working with the AOC to accomplish this objective.  I respectfully suggest that the time for objecting to the implementation of e-recording is in the past.  Instead, I encourage responses to Henry that identify potential problems that e-recording might create and/or provide constructive suggestions aimed at resolving those issues.  
Maryland has one of the most comprehensive and available online land records imaging systems in the nation. Please help the front end catch up.

But there is a core group of lawyers that fear an increased opportunity for fraudulent activity to creep into the system to corrupt chains of title:
Real estate is particularly valuable so anything that makes it easier to commit fraud is alarming. Electronic filing of documents will certainly make it easier for a fraudulent transaction to be perpetrated. While this can currently be done on paper, it will certainly be easier to do, and easier to escape being caught, to run a fraud that includes fraudulent release of existing mortgages, coupled with a fraudulent Deed and then mortgaging or selling the property to monetize the scam. Given the fact that one of the problems peculiar to real estate transactions and recorded documents is that they can lay dormant for quite some time (sometimes many, many years) before someone has reason to research a title and discover the issue, I think that the current system of requiring original documents protects the public to a much greater degree. The balance of potential harm compared to the convenience is not worth the tradeoff, in my opinion.
One real estate lawyer with over 40 years of practice voiced this common fear:
 How can the Clerk's office possibly know if the document being recorded is really an original document, OR if it is a copy of a copy, OR if it is a contrived and/or modified copy of a copy ? I believe that the Land Records are already most susceptible to that type of deception, and a recording system where no representative of the Circuit Court must even see or verify that an original document EVEN EXISTS, would be a horrible thing.
 And there you have it, a true split of opinions for and against electronic filing of deeds and other title documents. If the money is available to implement a system, though, it is a sure bet that e-filing is coming to Baltimore County.

What do you think?

UPDATE Oct. 1, 2014:  Here is a recent piece on the issue, published in the Daily Record.

Wednesday, September 17, 2014

Congratulations Baltimore Orioles Eastern Division Champs!

We are just pleased as punch that the Orioles are the American League Eastern Division Champions!  See you at the Yard.

Wednesday, September 10, 2014

The job interview you really had.

The job interview is not science, but more art. The outcome of many interviews are determined by wrong impressions. Imagine if every thought was expressed by both the interviewer and the applicant?