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When I was first asked to contribute to this column, I was somewhat hesitant. Attempting to discuss title issues that differ so dramatically from state to state in a single article seemed an enormous task. However, the more I thought about my everyday duties and what I could discuss, the more I thought about how those duties have changed since I became involved exclusively with reverse mortgages.
The responsibility of a title officer has evolved significantly over the years, from company to company. Certainly, the main tenet of any title insurance employee is to protect the integrity of our product. From the issuance of a title commitment to the completion of a final title, policy can be a simple, cookie-cutter process or a very involved and complicated ordeal involving tough underwriting decisions and risk analysis. In some cases, discussing title insurance can be as exciting as watching paint dry. If you do not think so, just join one of my webinars and try to stay awake.
A great deal of my time as a title officer is spent reviewing trusts, powers of attorney, conservatorships and guardianships. The review process for trusts varies depending on the lender’s requirements with regard to HUD guidelines. Some require a full review, which includes a determination of revocability and beneficial interests held in the trust, while others require nothing more than a determination of the powers of the trustee.
With regard to powers of attorney, we are careful to review and determine the various factors that make a power of attorney valid. The prescription of validity varies from state to state as the statutory requirements vary. In addition, and most importantly, we have to determine that the principal was competent at the time of execution of the power of attorney, or in cases where the principal is physically or mentally incapacitated, we require proof of their inability to act. That determination of incapacity is generally set forth in the power of attorney. Absent that, we normally require a statement from a physician to attest to that fact.
As a title officer, I take the protection of the borrower’s interest in their most important asset very seriously. We are dealing with a senior population that sometimes cannot make decisions without the assistance of others. That includes family members, lender representatives and us as settlement and title personnel. Retaining our role as impartial, neutral agents is not always easy. As a senior myself, it is sometimes a difficult task not to get emotionally involved in particular issues. Of course, we want to close the transaction and get the borrower on their course to financial comfort. However, I take great steps to see that it is done with the borrower’s best interest in mind.
There is a propensity for abuse when a senior holds financial assets. The reverse mortgage industry is sensitive to that issue and sitting at a desk trying to make decisions that affect the final outcome is sometimes a daunting task. Our requirements do not always make the process easy or make everyone happy, but they exist in order to ultimately lead to a successful closing and no post-closing surprises.
What sometimes is perceived as proceeding in an overly cautious
manner is not the case. Yes, we are protecting the integrity of our title insurance and settlement product, but more importantly, we are protecting and assuring the integrity of our seniors and their assets. That is my accepted responsibility, and I will continue to make that my primary motivation in my duties as a title officer.
