There are two ways real estate may be classified in Minnesota – Abstract and Torrens.
Abstract Property:
All land starts as abstract property. Any document that affects the land must be recorded at the county recorder’s office in the county in which the property is located. Traditionally, before a sale of the property, an abstracter would search the county recorders’ office and type an abstract, which is a “book” of all the recorded documents filed against the property certified to in the abstract. As this was time consuming and expensive, especially if the abstract was lost, the industry moved away from this practice. Instead, we now follow search guidelines created by the Minnesota State Bar Association to pull all of the relevant documents, a “chain of title”, and any other information needed to create a search package that an attorney or examiner can use to determine the status of the property. Abstract property may be registered to become Torrens property.
Torrens Property:
With Torrens property, the property owner is issued a Certificate of Title which shows the status of the property as of the date of the certificate. Any document that affects the land must be recorded at the registrar of title’s office, in the county in which the property is located, to affect the property. Each time the property is sold a new certificate of title is created and any documents that no longer affect the land are omitted from the new certificate. The attorney or examiner uses the certificate of title to determine the status of the property.
There are pluses and minuses to each system, but we at DCA Title are experts in searching and examining both types!