Q: If the county clerk's office closes and a deed cannot be recorded, what protects the buyer?
Does the title company doing the closing hold the proceeds until the deed is recorded?
A: Usually the deed is recorded after the proceeds are disbursed. It is now possible to record deeds electronically so they are submitted for recording. You will need to check with your attorney representing you in this transaction as to your concerns of protecting the transfer of title.
In the event of a recording office closing, title insurance underwriters, as of now, should continue to insure the gap by a temporary inability to record. So when a commitment is issued, the policy and CPL protections should remain in force as if the transaction was properly recorded on the day of disbursement. This, however, is changing daily. We have also begun implementing the use of a mutual indemnification agreements from both the Buyer and Seller to supplement this growing concern.
Please visit our website for more information at: http://fleitaslaw.com.
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