It's A Small World

Tall & Thin…yup, it’s what everyone wants to be…Well, in London “tall & thin” means big bucks…at least when it comes to real estate property. There is a house in London that measures just 5 feet across… that’s only 60 inches wide… Let me put this in perspective…60 inches is the length of the average bath tub…it’s about the width of your car…and it’s only slightly bigger than the length of Rafael Palmiero’s Pinocchio nose…What would you pay for this (excuse the expression) dollhouse? Need more information? According to the listing information it has a “narrow” kitchen, a “narrow” dinning room, three (you guessed it) “narrow” bedrooms, a shower room (what, no tub?) and five levels (I said it’s tall and thin). OK, so back to the real estate question…What would you pay for a 5 foot wide, five level house located in West London?... How about $933, 868 (that’s what I call a fat price for a thin house). The house is being marketed by London’s Winkworth Real Estate company. They describe the house as “unique” (you think?). “Full disclosure”…some sections of the house are wider (well, not that much… 9 feet wide or two of Palmiero’s Pinocchio noses). I figure they call this section the “Great Room”. Want to make an offer? First, you have to meet the physical requirements…Tall & Thin.

Katrina and Home Prices

Driving to work early this morning, I saw an employee at a gas station changing the numbers for the cost of gasoline on the big sign out by the street. What was $2.63 per gallon yesterday was $1.69 today. Many are predicting that the devastating hurricane (Katrina) that just struck Mississippi and Louisiana will so disrupt oil refineries and off-shore wells in the Gulf of Mexico that the price of gasoline and heating oil will skyrocket. Many have already been predicting $3.00 per gallon for gasoline by the onset of winter, but the effects of Katrina may accelerate this increase. While there’s no direct link between energy and home prices, it’s extremely likely that a rapid spike in energy costs will have an adverse effect on home prices. Even before this storm, there have been many indicators that the housing market is slowing. Saturday’s Globe business section led with the following headline: “Number of unsold homes surges.” Other stories told of a slow down in single-family home sales but a continued strong market for residential condominiums. While a number of factors undoubtedly contribute to strong condominium sales, foremost among them have to be the affordability of condos when compared to homes. And in a slowdown, the high end feels the effects first. As if on cue, I had to interrupt writing this to wait on a customer at the recording counter. He had two sets of documents to record. One was a single Order of Notice to commence foreclosure proceedings, the other was a full fledged foreclosure with a certificate of entry and a foreclosure deed: a preview of coming attractions?

School Days

Last week I taught a course at the Massachusetts Collectors and Treasurers Association conference at UMass Amherst. The subject was the"Collector/Treasurer and the Registry of Deeds”. Even though the class is not required by the MCTA for certification the course was very well attended. The topic that brought the most questions and discussion was E-Recording. The group asked excellent questions that ranged from determining document authenticity to fee collection. By displaying copies of the Middlesex North computer screens I was able to demonstrate the E-Recording process...step by step. As expected the next most popular topic was the Internet. I was both surprised and encouraged when questions were asked about finding specific entries. It indicated to me that the Internet has become an important tool for professionals. It's interesting when I think about the entire program...I spent the most time talking about technology. I'll bet that wouldn't have been true ten years ago.

Cell Phones and the Registry

The dictionary defines “ubiquitous” as “being everywhere at the same time; constantly encountered.” It’s not a word in my everyday vocabulary, but it works perfectly to describe the role of cell phones in our society. While cell phone use at the registry of could hardly be called ubiquitous, customer use of them has become a major distraction for our employees (me especially) while we are trying to do our jobs. Consequently, we have moved to curtail the use of cell phones within the registry. Our rule is not an arbitrary one – in the midst of entering data on a million dollar sale, we are often distracted by having to listen to one side of a telephonic debate on such pressing issues as what type of pizza to bring home for dinner. And distractions lead to errors. So no more cell phones may be used in the vicinity of the recording counter and other areas of the registry where employees are working. Of course, if there’s a reasonable question unearthed in the midst of the recording process, registry personnel may invite the customer to call the office for clarification.

Hotel Keys & ID Theft

Knowing of our interest in all things related to identity theft, a reader forwarded an article that reported on an investigation in California (where state government has taken an extremely aggressive posture towards identity theft) into identity theft at hotels. You know that plastic swipe card you are now given in lieu of a standard room key: well besides the information needed to open the door to your hotel room, it also has in many cases, your name, your home address, your hotel room number, your check in and check out dates and . . . your credit card number and expiration date. That information stays on that plastic room key/card until it is reformatted for the next hotel guest’s use. In the meantime, your information sits there, waiting for someone with a run of the mill magnetic strip reader (many makes and models available at affordable prices on eBay) to siphon your credit card number and head off on a spending spree. The express checkout routine at many hotels urges you to leave your key in the room and merely call the front desk when you depart. That leaves the card available to anyone who gains access to your room after you leave. Even worse, it turns out, is dropping the card in the wooden box at the front desk. From there, an unscrupulous employ can grab a handful of cards and cultivate identity information. The hotels are prohibited from charging you for a card that is not turned in, so this article advises travelers to bring the cards home and snip them up. Then again, you could always stay home.

Equifax

We often get calls from distraught residents of the Southern District of Middlesex County who have blemishes on their credit report courtesy of Equifax. It seems that this giant credit reporting agency has only one address for the registry of deeds for Middlesex County and that's "Lowell Registry of Deeds, PO Box 918, Lowell, MA 01853-0918." Never mind that we stopped using that or any other PO Box eight years ago, Equifax doesn't seem to acknowledge that there's a registry in Cambridge (we hope Register Brune doesn't learn of this). You see, Equifax will take information about liens and encumbrances from Cambridge, but they will only take discharges of those same liens from Lowell. Since neither the lien nor the property are in the Lowell District, it's impossible for us to produce a recorded discharge. Yet Equifax continues to tell consumers who rightly dispute the continued existance of liens to "Call the Registry in Lowell." While there's not much if anything we can do directly for the consumer caught in this trap, we have decided to write to Equifax and request that they start recognizing the distinction between the two registries. I'll put a copy of the letter on our website so that anyone in this predicament will be able to download it and send it along with an explanation. And if Equifax persists in this reckless behavior, we'll have to take more drastic measures.

Bomb Threat Follow-Up

This morning’s Lowell Sun reports that the man who told security guards of the “suspicious men” who allegedly put a package in the mail box outside the courthouse was arrested and charged with disorderly conduct, disruption of court proceedings, threats causing a public inconvenience and falsely reporting a crime. At the time he made the report, the man had a relative upstairs in the criminal courtroom, so he may have been angry with the court system or trying to disrupt that particular proceeding. As I mentioned in Tuesday’s blog entry, 29 years ago a disregarded bomb threat contributed to the serious injury of a courthouse employee when a terrorist bomb exploded on the front steps of this building. That bomb detonated at 6:15 a.m. on June 21, 1976 when the court custodian opened the front door from the inside. During the over night hours leading to the explosion, the “night watchman” within the courthouse received a telephone call warning that the courthouse and other “Suffolk County Courthouses” would be bombed that morning. Since the courthouse was in Middlesex County, not Suffolk County, the watchman ignored the call, assuming it was a prank. If that warning had been taken seriously, the innocent custodian would have avoided the serious injuries he sustained. Back in 1976 on the day after the explosion, two other threats were telephoned in to the courthouse, causing it to be evacuated. They say that history repeats itself – we certainly hope that’s not the case here.

Homestead Kiosk

We rolled out our newest invention today – a Homestead maker. Every day about a dozen individuals come to the registry’s Customer Service office to fill out a Declaration of Homestead. Up until now, we have provided preprinted forms that contain blank spaces for the customer’s name, address, town, and deed book and page reference. The customer fills these out, dates and signs the document. Then, one of our many notaries will acknowledge the signature and the customer moves over to the recording counter and records the document. Our new invention uses a computer with touch screen technology and a laser printer to produce personalized, fully printed Declarations of Homestead. On screen instructions prompt the customer to use a fingertip with the on-screen keyboard to enter the customer’s name, address, book and page reference. The computer automatically inserts the current date and then prints the completed form. The customer signs the form, we notarize it and record it – a clean, fully typed document. We’re still in an experimental mode with this new device, but if it works the way we hope it does, we might start mass producing them as a type of ATM-like kiosk that can be installed in town halls, libraries and other locations where people congregate.

Document Formatting Standards

We’ve been researching document formatting standards on the Internet in anticipation of adopting rules for Massachusetts effective January 1, 2006. Paper size is one area that requires some standardization. The rule will probably allow paper sizes of up to 8.5 inches by 14 inches which would include the great majority of documents now recorded. Some mortgages, however, are 8.5 inches by 22 inches (two pages joined at the top/bottom). When pages like that are recorded, we have to tear them apart. Often, the printed text straddles the fold so when we tear it, the text gets split apart. Another requirement will probably be that the printing be on only one side of the page. Margins are another problem. While it’s understandable that the person drafting a document will try to fit it all on one page, reducing the margins to a fraction of an inch is not the proper way of doing it. Miniscule margins leave us no room to place the bar code label with the recording information on the document, and extremely narrow margins on the sides and bottom might cause the images to be deficient. Many states require 3 inch margins at the top of the document and 1 inch margins on the side and bottom. The 3 inch margin might seem a bit extreme, but a 2 inch margin seems like it might be reasonable. Most states also have a minimum font size, usually 10 point which sounds reasonable. These items - paper size, printing on one side and at least a 10 point font – seem like reasonable standards to impose. We will write more about this in the coming weeks.

Bomb Threat

Early yesterday afternoon, a report was received that a suspicious package had been placed in the mailbox on the front steps of the courthouse. Courthouse security personnel called the Lowell Police who assessed the situation and decided it would be prudent to evacuate the building and call in the bomb squad to investigate further. All of the building’s occupants, especially the registry employees, cleared out of the building in an orderly and rapid fashion. The specialists were coming from a distant location, so we decided to formally close the building for the day and to send employees home at about 3:30 P.M. Members of the bomb squad arrived, suited up in their protective gear and thoroughly investigated the area. Fortunately, it was a false alarm and the all clear sounded at about 5:00 P.M. We were able to open for business as usual this morning at our normal time. A few customers did show up to record late yesterday afternoon, but with all the police cars, fire trucks, ambulances and assorted other vehicles parked around the building plus the yellow crime scene tape conspicuously draped across the sidewalks and Gorham Street, no one seemed too upset that they weren’t able to get inside the building. Many commuters were delayed by the traffic tie ups that occurred due to the closure of Gorham Street, but most seemed more curious than upset by the inconvenience. With the recent terrorist activity in London, security and safety are foremost in most peoples’ minds. And with the history of this building – a domestic terrorist group set off a bomb on the front steps back in 1976 – we are always cognizant of suspicious packages and unattended briefcases.

Is the Real Estate Bubble Hissing?

The great debate on whether the real estate bubble is about to burst or at least spring a significant leak continues to be waged in the media. For every person who says that prices will soon plunge (usually an economist) there’s another person who says the contrary (usually a real estate broker). Still, there some indicators that might help predict which way the market is heading. Several of them, unfortunately, are bits of information that are closely held by real estate brokers such as the number of houses on the market for how long. Another indicator is called Price-to-Rent Ratio which shows how much it would cost each month to own a property compared to the cost of renting it. I read, for example, that in a certain condominium complex in San Diego, California, the monthly mortgage payment for a traditionally financed unit in the complex would be $3700, while the monthly rent for a comparable unit in the same complex would only be $2000. When the cost of owning far exceeds the cost of renting, that’s a good indication that prices are inflated. Two other indicators are available here at the registry of deeds website. One is the sales price of houses. By looking at our Sales Reports (see the link on www.lowelldeeds.com) you can compare the sales prices of properties in this registry district over time. Our reports include all of 2003 and 2004 and 2005 to date. The other indicator is market activity which can be traced by the number of properties sold. While there has been a slight reduction in the number of deeds recorded here in Middlesex North during 2005, the drop has not been a staggering one. Here are the number of deeds recorded from January 1 to July 31 for the past five years: In 2005 – 5022; in 2004 – 5234; in 2003 – 5106; in 2002 – 5040; in 2001 – 4739.

New Recording Rules

Our new recording procedures turn one week old today and our customers are beginning to get used to it, although with real estate being as slow as it is these days, not everyone comes in each week, so there is still a lot of learning going on. Here are the highlights of the new rules: (1) staple together all loose pages of each document; (2) put the documents in the order you want them recorded; (3) write the property address on the first page of all deeds, mortgages and discharges; (4) make sure the property is recorded land, not registered land; (5) if the originals are to be returned to your pickup box, write the box number in the lower left corner; (6) if you have a self-addressed stamped envelope for document return, write “ENV” in the lower left corner of the document; (7) only three sets of documents may be recorded at one time (if you have more than three, you can get right back in line); and (8) No cell phone use at the recording counter. Unfortunately, this is just one more set of registry-unique rules that seem to be a departure from the statewide move towards standardization. But, as we’ve stated before, these rules have been necessitated by the lack of preparation of some customers who routinely present themselves at the recording counter with stacks of loose papers with the expectation that we’ll put them in their proper order and grouping.

Redacting Social Security Numbers

The software I saw demonstrated on Monday (aiIndex) has another very useful application. It can search through scanned document images and located social security numbers. It does this by looking for number combinations and the types of forms most likely to have such numbers. Once it finds a possible social security number, it highlights it so the computer operator can decide whether to redact it (black it out) or not. A registry in another state did a test in which employees looked through a certain number of records to identify all of the instances where social security numbers appeared, then the registry sent the same stack of documents to the designers of aiIndex and let them run their software on it. Well, the computer found 30% more social security numbers than the human beings did when searching the same documents. A very nice feature of this program is that the original page that contains the social security number is saved by the computer in a safe place and the exact location of the "blacked out" part is also stored so that if the change ever has to be undone (if for example, after blacking out entire social security numbers, the law requires only the first five digits to be removed). We haven't yet asked for a cost estimate to obtain this software. I suspect it's pretty high. But if the state legislature demands that we remove social security numbers from our records (there are several bills pending that would require this) we will need a product such as this to make that requirement happen.

To Be or Not To Be (not anymore)

The passing of Peter Jennings this week marks the end of a TV era. The “big three” news anchor are gone (Dan Rather, Tom Brokaw and of course Jennings). The days of a Walter Cronkite clone presenting The Evening News have passed. The careers of the above mentioned faded with the passing of time, but many would argue that big network media was on life support anyways…in fact if Hamlet were alive today he might have asked… “To Channel Surf or To Net Surf that is the question“. A recently released Canadian poll reports that Internet Surfing is overtaking TV watching. According to the survey the amount of time spent on the Web has increase by 46% since 2002. When this survey pool is narrowed to people between the ages of 18-34 the Internet overtakes TV. These younger people spend 14.7 hours on the Internet as opposed 11.7 hours of watching TV(watch out Katie Couric). More than a quarter of the survey respondents say they don’t have a favorite website…this means that Internet users are looking at varied sources to get information, especially when it comes to news. People log into specific sites for Health, Political and Sports news and many have a favorite Weather site…The big survey loser is the newspaper. The 18-34 year old set spends only 2.5 hours per week reading newspapers. This is the group that is changing the face of the information world.

Artificial Intelligence

Yesterday I travelled to the Registry of Deeds in Worcester to see a presentation on a computer program that would automatically index documents. The developer of this program, called AIindex is Mentis Technology, LLC and their website is http://www.aiindex.com/. The program seems to use a super sophisticated OCR (optical character recognition) technology. For those of you not familiar with OCR, we've been using it at the registry for administrative purposes for seven or eight years. (we've never used it in any way with recorded documents). Here's an example of how we might use it: A consultant gives us a report on paper but not in an electronic format. We want to use large portions of the text of that report in a new document. One solution would be to retype the portions you want. With OCR, you scan the original report, creating an electronic image of the document, then the OCR program "rescans" this electronic image, converting images of individual letters to word processing characters. The earliest versions of OCR software, yielded some pretty bizzare results, with "O" coming out as "Q" or "8" so you had to do quite a bit of editting. But OCR software is much more sophisticated now and AIindex seems like its the state of the art. There are many potential uses for this. In other parts of the country, registries are scanning newly recorded documents and allowing the OCR software to do the indexing. For example, the software would scroll through the document image looking for the words "grant to" followed by something formatted like one or more names. Those names would be placed in the grantee fields in the index. All fields would be populated this way. Then a registry employee would simply verify the data that was entered by comparing the names and addresses in the data fields with those in the document. It's supposed to be a much faster process than typing all of the information as we do now. With our need to get names into the index as soon as the document is recorded, I'm not sure this process would replace recording counter data entry in Massachusetts (the document must be scanned and then the software goes to work which all takes time - although not that much time). Still, the software looks like a fascinating tool that gave me a glimpse into the future. It's so good, that we should probably get it and then figure out how to best use it. But that's not all, this software has another very interesting application, but I'll write about that on Thursday.

Before you...

As part of our effort to streamline the recording process, we have moved the start of the recording line. The line now begins at the "checking table" located to the right of the registry’s Recording Counter. Copies of our new “Rules for Recording” have been placed on the wall at the document checking area. We urge you to take one and keep it for future reference. These instructions are pretty much self-explanatory…but if for some reason there is something you do not understand regarding these instructions, go to our Customer Service Office for assistance. Remember... before approaching the recording counter be sure your documents are prepared. It will save time and energy. The new checking table is equip with all that is needed to ready your documents… a stapler, a list of registry boxes, paper clips etc.

Recording Counter Renovations

We spent the day moving cashiering terminals around and cleaning up so much accumulated dust and dirt that our efforts at times resembled an archeological dig more than an IT project. We moved all of our cashiering terminals to one side of our "L" shaped recording counter, leaving the other side free for us to check documents. So when you arrive to record, you approach the broad expanse of recording counter where a registry employee will check over your documents, counting pages, checking for title references and signatures. Only after these checks have been made will customers move to one of the terminals where the recording process should be fast and painless. To help you prepare before you get to the recording counter, we've composed a one-page "Rules for Recording" that provides a check list of what you should do before you get to the recording counter. This form will be available at the registry and on our website on Monday. Unfortunately, this move was motivated by the ever increasing slopiness we have seen in customer document preparation. Now we'll just leave those who don't have their documents prepared standing at the check area and call on the next customer. So if your documents are in good shape when you get to the registry, you should get on record even quicker than before.

MCLE & Homesteads

Yesterday I traveled to Burlington to attend an MCLE seminar, Preserving and Transferring Your Client’s Principal Residence, primarily to hear the discussion about Declarations of Homestead. The distinguished panel of experts consisted of Alexander Bove, David Correira, Robert Ryan, Leslie Sleeper Madge and Robert Gorfinkle. Much of the program involved Medicaid planning and it was fascinating but also a little frightening given its complexity. Unfortunately, but not unexpectedly, the “should you file a new homestead after refinancing” question was left unanswered. In the 2003 Bankruptcy Court decision, In re Heretakis, 293 BR 82, that court held that Massachusetts law would not consider a mortgage to be a deed that would terminate an existing homestead. Unfortunately, no state appellate court has held likewise (although no such court has held the contrary, either). In the meantime, the panel seemed to suggest that practitioners continue to give explanatory but non-specific answers when confronted with this question, and hope that one of several pending homestead-related bills that clarify this situation be enacted soon. There did seem to be agreement that advising a client to record a new homestead after refinancing “to be safe” was problematic since the new homestead would wipe out the earlier homestead regardless of the legal effect of the mortgage. If the homeowner recorded a homestead in 2001, incurred a debt in 2002, refinanced in 2003 and recorded a new homestead in 2004, the 2004 homestead would terminate the one filed in 2001 and the debt from 2002 would then come before the homestead and be outside of its protection. (I had always understood this to be the case but once when I explained it on the Blog I was chastised by a lawyer who maintained that there would be no “interruption of coverage” in this scenario). One last thing: the panel emphasized that anyone filing for bankruptcy absolutely should file a declaration of homestead before filing the bankruptcy petition, no matter when the debts came into existence.

RSS

Technology never ceases to amaze me…just when I thought I had a handle on the World Wide Web (oh yeah, no one uses that term any more)… excuse me the Internet… something new comes along that sends me back to square one (or should I say DOS). This time it's RSS or “Really Simple Syndication” ("Really Simple" who are they kidding...I could use one of those Dummies books right now… “RSS for Dummies”). As I understand it…RSS is a format being used to syndicate news, magazines and blogs. Web publishers distribute headlines, news links and story summaries using RSS. This is big time…major publishers such as the BBC, The New York Times, The Christian Science Monitor and The Wall Street Journal all use RSS. This new ”contain channel”, as it is called, allows the tracking of information updates using something called a “News Aggregator (If I was writing the Dummies book I would define News Aggregator on page one). RSS is also widely used by the Weblog community to share new entries. When a new blog entry is published or a news source is updated it immediately appears on your “newsreader”(just another word for News Aggregator…as defined on page one). There is no need to go hunting newspaper websites for a news story or dealing with “pop up Ads”…RSS sends only the important contains directly to you. The Middlesex North Blog is currently not available in the RSS format… but as you can see…the research has begun to add this feature (and I am already getting a headache). Stay tuned…aspirins please.

"Tough Love" at the Recording Counter

We continue to experience problems with documents presented to us for recording. One problem occurs when a customer presents us with a stack of loose pages. This happens frequently and leaves us in a position of sorting through the stack, trying to discern what's a separate document and what's an attachment to a document. With multiple rider mortgages, this is no easy task. Of course, when an assignment or a homestead, the last in the stack, is counted as the last page of the preceding mortgage, the offender is quick to blame us for the oversight. The other problem is with the order of documents. Last Friday, a young man presented me with a stack of pages. I slid them back to him and asked him to staple the pages of the various documents together. He proceeded to staple the MLC, the 6D certificate and the deed all together in one package, then a first mortgage in another and the second mortgage in a third. I asked if that was really how he wanted things recorded (it would have went on record as a 3-page MLC then two mortgages). He called someone on his cell phone and spent a considerable period of time tying up the recording counter sorting through his documents. When he finally gave them back to me, the first three documents were separate, but the mortgage in the lesser amount was in first place and the mortgage in the greater amount was in second place. And that's exactly how they were recorded. At some point, I suspect, someone will realize the order of the mortgages is wrong and call, asking what can be done. Well they have two choices: Leave things as is or rerecord both mortgages in their proper order, paying the $175 per mortgage recording fee - that'll cost $350 dollars to sort that out. That's what I mean by "tough love." For too long, we've been trying very hard to accommodate people, to help sort out documents and put them in the presumed proper order. But the only result our efforts have yielded is more sloppiness on behalf of more lawyers and their agents. So we've decided to tighten up our procedures to try to force the offenders described above to do the bare minimum that is expected from an attorney in the real estate business. For the vast majority of you who are consummate professionals, this should only improve your experience at the recording counter since you shouldn't get stuck in line behind a customer who's trying get his papers ready at the recording terminal rather than back at the office. If our measures, which we will describe here in the near future, have an adverse impact on you, please let us know.

Patiences

Scanning the Miscellaneous Jurisdictions is turning out to be a more difficult job than expected. In their original form most of these documents are legible, but in some cases once scanned the images become difficult to read. In many cases the solution is easy…simply darken light pages using a copy machine... then scan the copy. Sometimes the document has to be copied several times at various exposures to get a quality copy. If (and fortunately this hasn’t happened yet) we cannot create a good image by scanning a copy, we will re-create the document on a word processor...then scan it. There are only about seven hundred Miscellaneous Jurisdictions. It may seem difficult to believe...but over all, the 160,000 Registered Land documents we just finished scanning were in better condition than the Miscellaneous Jurisdictions…It is obvious that the key with this project is being patient.

A New Look for the Blog

There's a new look to the blog. The content is the same and we will continue posting as usual, but we have changed the appearance to make it easier for our readers to navigate around the site. As always, we welcome your comments and suggestions about the content of the blog, but we would also be happy to hear from you about its appearance.