To further support your due diligence efforts when working with your clients, a Parcel Register can provide you with important property details that you might not find anywhere else. But what exactly is it? Our Senior Product Manager, Christine Cole, answered some pressing questions regarding this report for you to better understand how you can use it in your business.
Q: What is a Parcel Register?
A: A Parcel Register is a digital document that includes registered instruments on title, that date back to when Teranet digitized the Ontario Land Registry instruments. It is a report of the Province of Ontario, that presents several key details about a property including:
- The property’s PIN (the Property Identification Number)
- A legal description of the property
- Details of the registered owner(s), both past and present
- Type of ownership and % of ownership
- All registered interests:
- Liens
- Encumbrances
- Easements
- A history of property transfers (sales), including the names of transferees/transferors, dates, and sale amounts
- Detailed history of registered mortgages (charges) and discharges of mortgages (charges)
Q: How would mortgage brokers use this in their daily business?
A: A Parcel Register can help mortgage brokers validate their customer’s information and ensure that you don’t waste your time on a mortgage deal that is going to have multiple issues. Instead, you can focus your energy on a deal that has potential.
Having access to a Parcel Register can ease your due diligence process. For example:
- Validate if your client is the registered owner or if there are others listed as owners on title that you didn’t expect. This is particularly useful when you’re working with a new client or an investment property that you haven’t worked with previously.
- You can identify underlying issues instantly – like property liens or odd transfers that can indicate fraud.
- You can see the mortgages currently registered against the title of the property and review the full lending history against the property.
- Identify potential problems when it comes to registered mortgages. For instance, the seller could have taken a mortgage that is not from a chartered bank, trust company, credit union, or a similar institution. In the case it is a private mortgage, a standard clause may require the mortgage to be discharged prior to closing. In this case, you can work with the seller to clarify this information and if needed, amend the agreements of purchase and sale accordingly.
Q: What is the difference between a Parcel Register and an Instrument Image?
A: The parcel register is the report that chronologically sets out all interests that have been registered in connection with a particular property. The instruments are images of the documents that were submitted into the province’s land registration system and reflect each of the interests shown on the parcel register. The information contained in a Parcel Register can often be enough to answer the questions that led you to request the Parcel Register in the first place. However, you may have further questions as a result of reviewing the Parcel Register. You can dig deeper into details of a specific interest by looking at the documents registered. These documents are often referred to as instrument images and can provide further detail about a specific activity on title.
Q: Can a Parcel Register be used to identify if a mortgage is conventional or collateral?
A: If further detail is needed regarding a particular mortgage (charge) registered on the title, you can use the Instrument Image (instrument document) to get further information about the mortgage. For example, you can review the Instrument Image registered for the mortgage and may get details about the type of mortgage (collateral or conventional), the registering legal firm, the interest rate, the mortgage term, etc.
However, it is important to remember that specific details about the mortgage are only as good as the information provided in the instrument and are not guaranteed. The extent of additional details will vary depending on the instruction of the lender.
Q: How can a Parcel Register help a mortgage broker detect fraud?
A: There are key pieces of information contained in a Parcel Register that a legitimate homeowner should be aware of, and you can use that information to validate a potential customer.
For example, you can validate the following information in a Parcel Register:
- What was the most recent sale date of the property?
- Are there any mortgages on the title and if so, with what institution is the mortgage(s) registered?
- What date was the mortgage(s) registered?
- What is the name(s) of the previous property owner? In other words, who did the current homeowner purchase the property from?
If your customer can’t easily answer those questions, you may wish to conduct further due diligence to satisfy yourself as to the legitimacy of the transaction.
Q: What is the difference between a Parcel Register and a Title Search? Are they the same thing?
A: A Parcel Register has often been thought of and referred to as a Property Title Search by real estate sales professionals; however, the Parcel Register is not a Property Title Search but rather a major component of one. A Parcel Register is an official government report, whereas a Title Search is an activity in which you would perform to validate property information. A Property Title Search will not only include reviewing the Parcel Register but also examining any registered instruments and plans.
A big thank you to Christine for her responses! If you would like to learn more about a Parcel Register, please consider joining our Teranet’s Senior Director of Government Relations, Eric Black in our informational training course, Land Registry Data as a Fraud Mitigation Tool.
