Vacant and abandoned properties pose a serious threat to the health of communities. Local governments are eager to get them into the hands of responsible (often new) owners. Before progress can be made, it’s important to identify and connect with the property owner. It’s critical for local governments to know who owns a property, and with vacant properties this can be especially challenging.
Nearly all owner records come from one of three sources: the county assessor, county treasurer, or the county deed office. Looking up an owner in county records is easy enough. Other potential sources are the recorder of deeds (data gathered from recorded documents) and data gathered from transactions (like mortgages, foreclosures, or sales). However, when searching for hundreds or thousands of records, working with a data vendor is more efficient. Data vendors organize and standardize property data for a fee.
Because you have to work with up to three different sources, you will be assembling information about a property in pieces. We recommend organizing the disparate bits of information into a comprehensive data management system like ePropertyPlus. ePropertyPlus is designed to organize data on properties and owners, conditions data, documents, images, and more, into an intuitive and searchable system. It is much more useful as compared to an excel spreadsheet or an access database, though for small numbers of properties or records, those might be adequate.
Public owner records are useful, if they are current, accurate, and clear. But what do you do if data is incomplete, not digitized and easily searched, or hidden behind an LLC?
Local governments overcome part of the challenge by requiring owners to register their vacant property. In NY, mortgage servicers have to register certain foreclosed properties. Vacant property registration and foreclosure registrations allow local authorities to quickly and efficiently identify a responsible party for a property.
In our work with rural communities and small towns, we find data may not be digitized or searchable over the web. This makes it much more time consuming to gather basic information together.
A simple way to identify a property owner and other interested parties is by purchasing a title report from a title company. A title survey or title report is a document that lists all parties of interest on the property, such as the current owners, lenders, lien holders, and others who may have a legal interest in the property. In most cases, some portion of that party’s contact information will be included.
Your municipal attorney can order a title report, and usually at a lower cost compared to what you might pay directly. They can also decide what type of title report to order.
Now, this strategy only works if the owners or parties of interest have recorded documents against the property. In certain states and with certain types of properties, transactions may not be recorded through a title company, so you need to get a bit more creative. And of course, there is a cost involved for the attorney’s time and for the report itself.
It’s possible to use a method called skip tracing if you have at least a portion of the owner’s information, such as a company name, address, or email address. Skip tracing involves running an electronic search against a data point to produce a list of likely hits, which then need to be researched individually. Skip tracing services may charge around $0.25 – $1 per record and can provide a mailing address, phone number, email, name, etc. associated to the piece of identifying information (such as a name or phone number). While this method can produce results, there’s no guarantee that associated data will be found, and it is only possible to use a skip trace if you have at least one piece of identifying information. It can also be time consuming to sift through the results.
The strategies listed above will work in many cases, but not all. We mentioned previously the challenge of locating owners hiding behind LLCs. Buyers use limited liability companies (LLCs) for convenience and to separate their business and personal property for legal and tax reasons. The same convenience that benefits an owner can stymie local governments, because the LLC shields the names of the beneficial owners from public scrutiny. You can search the LLC name in the secretary of state business or corporate records, but that will typically only produce the address and name of the party that registered the LLC. It’s better than nothing, but won’t tell you who the actual owners are. Another obstacle are cases where documents were not recorded or the owner has passed and there is no clear estate plan. If a property’s owner passes away without making a Will, it may need to go through probate or another legal process to identify who is legally entitled to – and responsible for – the property. That process is time consuming and requires someone to take action. Many local governments are leery about stepping into this sort of action.
Identifying the owner of a vacant property and the persons or parties that may have interests in it can require more than one method. Gathering disparate bits of information into a data management system helps build a composite picture of the property. Notes and images produced from staff or residents on the ground round out the picture even more. Keeping track of all of this data is what ePropertyPlus was built for. And as the organizations tackling vacant property have become more sophisticated, so has ePropertyPlus. We’ve evolved it to support vacant property registration programs, property maintenance code enforcement, and of course, an inventory of property records, such as those used by land banks or local governments holding vacant property .
If you are grappling with how to address vacant and abandoned property, get in touch! We also recommend the Reclaiming Vacant Properties Conference (RVP). RVP is hosted by the Center for Community Progress and is the only national conference dedicated to sharing new strategies to transform vacant, abandoned, and deteriorated properties into community assets. RVP happens every 18 months and the next one is in Chicago on September 7-9. This year’s theme is “Responding to Crisis: Building an Equitable and Resilient Future” – and registration has opened for the RVP conference.
Our eProperty Innovations team will be there giving demos and answering questions about how to identify and put vacant property back to good use. We hope to see you there!