I recently read your column regarding title insurance and would like your perspective on a request recently made of me by the title insurance company that the buyer of my condo has selected.
I have a condo on the market that is under contract. Apparently, the title company has done a preliminary search and there are four judgments against someone with my name. The title insurance company has asked for my Social Security number. I do not like to give out my Social Security number, and as far as I know, there are no judgments against me. Should I give the title company my Social Security number? Is there a way for me to check on this without giving it to the title company?
I live in Maryland. The condo is an investment property in Alexandria.
I would appreciate your advice.
Thank you for reading my column. Unfortunately, with a common name like Jones, it is inevitable that there will be others with the same name who have judgments recorded against them. A judgment against a home buyer or home seller automatically attaches as a lien against their real property. The title insurance company will always run all buyers’ and sellers’ names through a judgment search to see if there are outstanding judgments against any party. If there are judgments, they will have priority over the buyer’s and buyer’s mortgage company’s interest. Those judgments will have to be paid off, or provided for, at settlement before the transaction can settle. This is why the title company is asking for your Social Security number — to try to determine that the judgments that showed up in the records are not against you.
Even with your Social Security number, they may not be able to determine that the judgments are not against you. For example, many years ago it became illegal to list anyone’s Social Security number in a public record. Although this was a great boon to privacy, it made it much more difficult to dismiss a recorded judgment matching your name. In order to make certain that the judgment is not against you, the title company will attempt to contact the party holding the judgment to see if their Ms. Jones’s Social Security number is different from your Social Security number. Having at least the last four digits may allow there to be a positive “hit” — meaning the judgment is against you. Or they can conclude it’s “NOP” — not our party. Because so many banks and credit card companies have gone out of business over the years, it is frequently impossible to locate the judgment creditor.
As for privacy, title companies must adhere to the Dodd-Frank Act’s provisions. They are not allowed to publicly disclose confidential information, such as your Social Security number. Since you say you are selling your investment property, they will need to have your Social Security number anyway, as they are obligated to provide you with an IRS Form 1099 gross sales proceeds report.
If you want to conduct your own investigation, you can certainly ask the title company to provide you with the four judgments that showed up under your name. You can then examine them to see who the creditors are and look at the dates and circumstances to see if it’s possible they are against you. You can contact the creditors directly if you wish, to confirm that you are not their judgment debtor. If they are willing, ask them to confirm to you and your title company in writing that you are not the person they have a judgment against.
Finally, if you are unable to positively determine that the judgments are against someone else to the title company’s satisfaction, you will be asked to sign a judgment affidavit. This affidavit will require you to swear, under penalty of perjury, that you are not the party named on those four judgments (attach copies).
If you sign a judgment affidavit at settlement, you should keep a copy handy, because it’s probable that these judgments will come up again if you decide to buy other property or even apply for credit. Judgments generally last for 12 years and can be renewed by the creditor for additional 12 year periods until paid off, at which time a judgment satisfaction document should be recorded in the judgment records where the judgment exists.
Harvey S. Jacobs is a real estate lawyer with Jacobs & Associates in Rockville. He is an active real estate investor, developer, landlord, settlement attorney, lender and Realtor. This column is not legal advice and should not be acted upon without obtaining your own legal counsel. Contact Harvey at 301-300-6252, firstname.lastname@example.org or email@example.com.