On the bright side, it’s not the robo-signers this time. In Taos County, New Mexico, two “heirs” have filed warranty deeds laying claim to a combined 42,000 acres of land and calling the ownership of about 7,000 properties into question[1]. The warranty deeds were filed in an effort to show the right to inherit ownership of the land because the filers are descended from the original owners. However, the validity of the deeds is in question because they “fall outside of what is traditionally considered the chain of title used to identify ownership.”
While the mess is sorted out, real estate has ground to a halt in Taos County. Sellers can’t sell; owners can’t refinance, and buyers are forced to put closings on hold. Every property affected by these warranty deeds now has a cloud on the title, and title companies will not insure the title because ownership of the property is in question. Although New Mexico does not require title insurance, the insurance is required by nearly every mortgage lender in nearly every deal to insure that the property’s ownership is solid in the event that foreclosure is necessary.
To make matters even more complicated, the trustees of the grants filed that have “gummed up the system” have already said that they have no intention on following through with their claims on the properties in question. In fact, Robert O. Gonzales filed the deeds to drum up interest in La Serna Land Grant meetings[2]. He says that for two years no one came to the meetings, but “look…they are here now.” However, now that Gonzales and the other heir have the attention they want, unwinding their actions will require more legal acts that neither have undertaken yet. They must rescind the warranty deeds before the titles on all those properties are cleared. The local government’s tax revenue is also now in peril, which could impact everything from public schools to services and safety.
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[1] http://taosnews.com/articles/2011/03/04/news/doc4d712a710fdfb340611418.txt
[2] http://www.abqjournal.com/abqnews/abqnewseeker-mainmenu-39/27725-land-grant-heir-claim-was-a-ploy.html
It is just a stunt but good for them. Goes a long way towards showing just how worthless title insurance really is, and how it is just one of many scams in the real estate industry which are forced onto to buyers and sellers! I applaud them for their actions, it is time more people did the same type of thing, to show everyone just how corrupt and unreasonable most of the “laws” and regulations are concerning real estate in the United States.
While it is inconvenient for the current property holders, it shows how if title insurance was really worthwhile, this would have been considered, and address long ago. In fact title insurance does nothing for the buyer or seller and little for the lender. If it had any real merit they would be able to go back to previous tile insured sales and say how the property was shown clear before, but they cannot do that because they sell a worthless product and know it!