Every South Dakota county has at least one Land Title Agency. In fact, fifty six of the sixty six South Dakota counties do have just 1 agency. As for the other ten counties, eight have 2 agencies, Lincoln has 3 agencies and Minnehaha has 4 agencies.
A title insurance agency investigates the county land records to determine whether other individuals or entities also have a legal claim to the property and what, if any, encumbrances exist. This validation that the title is free from defects and encumbrances is required to get a title insurance policy and financing.
THE PLANT….. County Land Title Agencies are required to be licensed by the state and must meet specific criteria to operate in South Dakota. To operate within a county, the agency must make a copy of every document that has ever been filed at the county Register of Deeds, Clerk of Courts and Treasurers offices on property within the county.
Each document is then indexed so the document can be easily located by legal description, location, address or the name of any person, company or entity that appears on the documents. These names would include owners, lenders, easement holders or lien holders. Basically if a name appears on a document that is filed at a county office, it is put into the index. This index and copy of records is called a "County Land Plant".
Then after all the existing documents are copied and indexed, the title agencies land plant will need to be constantly maintained. Every new document that is filed at the court house in the future will have to be copied and added into the index.
To open a new County Land Title Agency in South Dakota is not easy. In fact it can cost as much as a million dollars and take a year or longer to build.
There are the added benefits that come with the creation of a County Land Title Agency. The copies of the counties land records at the Land Title Agency become an off site backup to the originals in the county offices. Plus, when the land title agency does a title search they compare their records to the county records. If any discrepancies are found, they are corrected. This cross check improves the accuracy of both sets of records.
THE PROCESS…... An order is placed with the Title Agency by a lender, real estate agent, broker or escrow agent. The Title Agency searches all filed documents to determine if the owner is legally able to sell, improve, escrow, finance or will the property. Included is the search for the existence of claims such as liens, mortgages, judgments, easements or taxes. In South Dakota this search is done by accessing the index of records located at the Land Title Agencies office. The specific documents pertaining to the property are researched to determine any defects in title.
After the records at the Land Title Agency are searched, a search at the County Courthouse takes place. This search compares the Agency records to the county records and the researcher reviews all documents, titles, liens, judgments and taxes on the property.
Be aware that this title search only discovers documents of public record. Anything done illegally or without proper recording may not be discovered. Plus there is always the chance of human error in the filing or locating of documents. This is where title insurance comes into the picture.
Land title records in South Dakota are some of the most, if not the most, accurate in the nation. This fact plus the South Dakota pride in workmanship, are the two main reasons that the records at the South Dakota county offices or agency offices are the best in the county. Great records equate into South Dakota property owners and financial institutions having very few title insurance claims as compared to the rest of the country.
Some Title Agencies also perform other key functions. They act as closing agents, maintain and distribute escrows accounts and file the completed documents with the appropriate county offices and financial institutions. Most importantly they are the retail sales agent for the title insurance policies for the new property owners and financial institutions. This title insurance product is a very important aspect of their role in the county.