Joan Smith was the borrower on the new loan. Sam Smith was her ex–husband. Jennifer Videgain, Escrow Assistant with Chicago Title's Madera, California office, contacted the borrower to obtain Sam's contact information so she could confirm that he did sign the deed transferring title to Joan.
Joan Smith indicated Sam Smith was unavailable. She explained he had moved to Mexico and she could not locate him. Joan Smith and Jennifer had a language barrier, so Joan Smith asked Jennifer to talk to her daughter to find out if she had any additional questions. Jennifer explained the situation to Joan Smith's daughter. The daughter told Jennifer her Mom was awarded the house as part of the divorce settlement.
Jennifer relayed this information to Title Officer Barbara Eickmann. Barbara asked Jennifer if she could obtain a copy of the divorce settlement. Joan Smith said she searched through her records but could not find a copy of her marital settlement agreement. She did, however, provide a copy of the final divorce decree. Unfortunately the decree did not say anything about who was awarded the property.
Joan Smith had been living in the home making the mortgage payments all along. She applied for the new loan so she could rehab/remodel the property. Barbara kept digging to find a solution.
Barbara reviewed the Quitclaim Deed by comparing the signatures found on the existing Deed of Trust. It was clear Sam Smith's signatures did not match. Barbara was concerned she had uncovered a forgery and urged Jennifer to get in touch with Sam Smith directly.
Jennifer contacted Mrs. Smith's daughter and insisted she turn over the contact information for her Dad. The daughter finally provided his phone number.
The husband confirmed he did not sign a deed conveying title to his ex–wife. As a matter of fact he had already moved to Mexico when the deed was signed. Jennifer asked him if he would be willing to sign a deed now and he said, "No."
Chicago Title notified the lender they would not be able to proceed. The lender cancelled the deal but there is a happy ending. The wife re–opened her divorce case and asked the courts to award the property to her so she could move forward with her plans to remodel her home. The courts agreed to her request and the appropriate paperwork is being completed.
MORAL OF THE STORY
Both the title and escrow departments did an excellent job of working together on this file to avoid a potential claim. For their efforts Barbara and Jennifer will split the $1,500 reward and both will receive a letter of recognition on behalf of the Company.
Remember, title insurance is unique when compared to most other insurance products since title insurance covers acts which have already occurred, unlike risk insurance which covers events which might occur in the future.
Barbara's thorough review of the public record revealed this forgery. Jennifer did not quit until she was able to make contact with Sam Smith to confirm Barbara's findings. In the end their hard work convinced the borrower to clean up the cloud she created on her own chain of title — legally. Good job Barbara and Jennifer!