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Wednesday, February 22, 2012

National License, National Database, National Everything?

There has been discussion about a national driver’s license, a national license to practice law, a national database for IRS liens, a national database for all real property liens, and a national registry for all real property records. The Federal Reserve, in its proposal for a national lien registry, says its idea would make locally recorded information more “user-friendly” by providing one-stop access to mortgage and servicer information. Didn’t we already try this with MERS? Was that system a big success?

A few years ago a bill was proposed in Congress to establish a national insurance office. More recently, a federal land titling system was proposed.
Now there is a proposal by the Uniform Law Commission to consider a federal foreclosure process. Would that process work for all states, including states that have deeds of trust instead of mortgages, or nonjudicial foreclosures instead of judicial foreclosures? The American Land Title Association is closely monitoring this proposal.
What is the benefit of national oversight for real property transactions? It might be easier to find property owned by your judgment debtor if you only have to search one database instead of knowing what county, township, or parish you need to search. But you risk finding 200,000 Barbara Burke property owners nationwide instead of just 2 Barbara Burke property owners in a particular county. Which one is your debtor?
Will there be a problem with the different state recording laws, especially the privacy issues? The recording of documents would still take place at the local level but would the local recorders still index the documents?  If a mistake is made in the indexing at the federal level, do you think a consumer or title company could sue for damages? I think not.
→ What do you think about a national license allowing you to conduct business in any state, or allowing others to conduct business in your state?
→ What do you think about a national database for all of your real estate information?