A borrower's preliminary title report reveals an existing lien that doesn't appear on their credit report. The borrower claims the debt was satisfied but cannot provide documentation. What should the processor prioritize?
Correct Answer
A) Require payoff documentation from the lienholder before closing
Liens shown on the title report must be properly satisfied and documented before closing to ensure clear title transfer. The processor must obtain official payoff documentation or satisfaction of lien documents from the lienholder, regardless of credit report information or borrower statements.
Why This Is the Correct Answer
Liens shown on the title report must be properly satisfied and documented before closing to ensure clear title transfer. The processor must obtain official payoff documentation or satisfaction of lien documents from the lienholder, regardless of credit report information or borrower statements.
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