MReport March 2018

TheMReport — News and strategies for the evolving mortgage marketplace.

Issue link:

Contents of this Issue


Page 25 of 70

24 | TH E M R EP O RT FEATURE • • any•instances•where•a•mort- gage•has•been•assigned; • • tax•liens,•foreclosure•notices,•or• UCC•filings; • • any•potential•judgments•currently• against•the•owners•as•well•as• against•buyers•and•sellers; • • search•for•outstanding•viola - tions•against•the•property• through•building•or•housing• departments; • • search•of•real•estate•taxes,• school•taxes,•utilities,•etc.; • • certificate•of•occupancy•search; • • highway•department•searches,• bankruptcy•searches,•and• Patriot•Act•searches; • • and•other•searches•that•may• or•may•not•be•required•in•a• specific•jurisdiction. Roadblocks Ahead M unicipalities,•often•cash- strapped,•will•need•to• calculate•the•potential•return•on• investment•that•would•drive•an• expensive•initiative•such•as•an• overhaul•of•real•property•records.• The•current•system,•while•not• always•perfect,•has•been•adequate• for•a•long•time.•Let's•not•forget• that•oftentimes•municipalities•earn• their•revenue•through•record•ac - cess•and•recording•fees•in•lieu•of• raising•property•taxes. So•the•question•that•munici- palities•will•be•asking•blockchain• providers•to•answer•is:•What•is• the•financial•benefit•to•incur•the• upfront•expense•and,•for•some• constituencies,•the•political•risk• associated•with•implementing•a• system•that•may•or•may•not•work• better,•more•efficiently,•or•at•all? In•addition,•what•about•the• employees•who•may•become•col - lateral•damage•from•a•new•system• and,•importantly,•will•the•taxpay- ers•willingly•sign-on•for•the•cost• associated•with•the•process? If•an•attempt•is•made•to•imple- ment•blockchain•for•records— and•ultimately•as•a•payment• mechanism—municipalities•also• will•need•to•answer•the•question• if•blockchain•will•be•accepted•in• both•the•short-•and•long-term•by• government•oversight•entities•that• regulate•lenders,•attorneys,•and• anyone•else•critical•to•the•land• title•process.• MICHAEL HALTMAN is President of Hallmark Abstract Service located in New York City and on Long Island. Haltman also serves as Board Chair for the combat veterans 501(c)(3) Heroes To Heroes Foundation. "Title insurance is an industry that is a natural fit for blockchain. As is typical with real estate, it will take time for the benefits of the investment in the technology to accrue, but they are certainly a worthwhile investment." —Benjamin Polen, Real Estate Advisor and Consultant, Polestar Realty "While some may have concerns about this disrup- tive database technology, blockchain could improve the way we do business by managing real estate data and sales transactions more efficiently and se- curely, including streamlin- ing how titles are recorded and transferred, making our jobs easier and trans- actions faster, less costly, and more resilient against fraud." —Elizabeth Mendenhall, 2018 President, National Association of Realtors "Land titles are complicated. It's not simply a question of 'who owns the title,' like a Monopoly deed ... Most of what is seen in the press is more hype than reality. To reach that potential, all the relevant players will have to come together (real estate agents, mortgage finance, title, and local governments) to invest in the tech and new laws to make blockchain potentially work. Blockchain makes more sense when it tracks owner- ship of new assets like bonds or swaps. In real estate the his- tory of the property matters." —Jeremy Yohe, Director of Communications, American Land Title Association "If you were to design a [title] system today, it would look a lot more like what people are talking about in terms of recording electronically and through something like the blockchain than the system we have in place now ..." —Michael Pieciak, Commissioner, Vermont Department of Financial Regulation Experts Weigh In T he issue of blockchain implementation is incredibly complicated and will be debated and vetted by experts on all sides of the argu- ment, including local and regional government entities, the "global" real estate industry from buyers and sellers to lenders and lawyers, private technology interests, and the title insurance industry itself. There will be the naysayers who have a vested interest in blockchain not being implemented and those who would benefit from being among the first who figure out a way for the implementation to take place. Suffice it to say that we are currently in the infancy stage of this process, but here is a sampling of expert opinion:

Articles in this issue

Archives of this issue

view archives of TheMReport - MReport March 2018