Coronavirus Impact: Delivery Drivers With Symptoms and ‘Distance Mourning’ After a Shooting - The New York Times

The coronavirus has snarled many spring home-buying plans, as apartment buildings ban open houses, real estate agents shutter brokerages and quarantines make it tough to even step outside.

Now, another obstacle: The closure of government recording offices, as all nonessential employees in New York and other states have been told to stay home.

Squirreled away in county buildings, and probably not high on the list of things buyers care about, these offices are nevertheless vital to the buying and refinancing processes, as title searches and deed filings happen inside.

“The machine is being overwhelmed at this point,” said Bob Jennings, the chief executive of ClosingCorp, a tech platform involved in a third of the country’s home-loan applications.

And it’s happening at a really bad time.

The last few weeks saw a surge in mortgage applications, especially from borrowers seeking to refinance in the face of low interest rates, and many of those loan closings are scheduled now. Most lenders require a title search for refinancing. “It’s one of those perfect-storm type of scenarios,” Mr. Jennings said.

All told, as of Friday, about 1,000 of the country’s 3,600 recording offices had shut down or curtailed their hours, according to the American Land Title Association, a trade group crowdsourcing a closures list.

The New York City area seems representative of the country as a whole. While the recording offices in all five of New York City’s boroughs were still open on Friday, many expect them to be closed on Monday.

And in the suburbs on Friday, recording offices in New Jersey counties like Bergen, Hudson, Passaic and Essex were dark, like those in Nassau and Suffolk Counties, which have been hit hard by the virus. In Connecticut, similar locations in towns and cities like Fairfield, New Canaan and Bridgeport, were shuttered, but Westchester County, another heavily infected area, was open.

A lack of staff doesn’t totally derail business. About 2,100 of the 3,600 offices allow electronic filings. But a human being ultimately has to process those filings, known as e-recordings, “so if no one’s there, the pipeline is still blocked at the end,” said Steve Gottheim, a senior counsel with the title association, which is urging officials to leave at least skeleton crews in the offices.

If a deed fails to be recorded in a timely manner, lenders can get spooked by the potential for fraud. Without a public record, a devious seller could technically sell a house twice.

And while offices offer searchable online databases, many don’t go back far in time, so a title-searcher may have to actually go and sift through physical documents, which are prerequisites for any deal. “Any reduction in service makes it almost impossible to get a closing completed,” said Mr. Gottheim, who recalled just two other times when recording offices closed unexpectedly — in New Orleans, in 2005, after Hurricane Katrina, and in Baltimore, last spring, after a ransomware attack.

Closings themselves may become limited, as people have become leery about sharing close quarters. Videoconferencing is a possibility and about half of the states already allow notaries to do their job virtually. As of Thursday, New York, under executive order, permits it, too.

But some worry that hastily thrown together online notarization systems are also prone to fraud. “How can you tell if a driver’s license is legit if you’re looking at it through a camera?” Mr. Gottheim said.

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