The law in Louisiana currently requires that before a policy of title insurance may be issued, a title opinion must first be rendered by an attorney authorized to practice law in Louisiana. The opinion must be based on an abstract of title. “Abstract of title” is a written history of the recorded instruments in the public records affecting the title to real estate. By law, the abstract must be for a time period going back at least 30 years or more. In its 2001 published “Uniform Title Standards,” the Louisiana State Bar Association recommends a search period of 35 years or more.
Today, some local and national title insurance companies use ‘offshore’ title services in India, the Philippines and other foreign countries. Most often, the property reports that these offshore companies prepare are not based on a complete and thorough review of the records filed in the parish conveyance and in mortgage records, as is required by law. In fact, these property reports are usually based on tax records and are done for a fraction of the cost of a complete abstract of title prepared according to Louisiana law. And, let’s not forget the issues of identity theft when an order is placed with an offshore operation. If something goes wrong, you have no protection under the law for misuse of your non-public personal information.
Merchantable title is the Gold Standard set by Louisiana title attorneys to determine the marketability of property. It is based on the determination by a Louisiana attorney that no third party has a claim against the property that would be suggestive of litigation. This is the xxxxxx standard set forth in the Louisiana Real Estate Commission’s mandatory residential purchase agreement. Preferred Title Company’s experience, especially over the decades, has been that when prior transactions in the chain of title have been handled by national or affiliated title operations, and title is based on such off-shore title services, that the title to the property is subject to defects which can render the property non-merchantable, meaning the property can not be sold until and unless the title defects are resolved.
If you want to be certain that “this land is your land,” as the Woody Guthrie song goes, let your real estate agent or lender know that you want a local Independent Title Company to handle your transaction. Ask them to give you several references. Call them and ask if they use local abstractors to search public records.
You have a federally protected right to select the title service provider that will handle your real estate transaction. Be sure that your title was actually read in Louisiana.
Rest assured by requesting the services of Preferred Title Company, an Independent Louisiana Land Title Company with offices in Baton Rouge, Louisiana and staffed with attorneys licensed to practice law in Louisiana, the title to your property will be reviewed by our attorneys.