10 November 2015

Past Ownership and the House's Chain of Title- Part 3 (Adding Mortgages to the Mix)

This is Part 3 of a 3-part series which analyzes the chain of title completed by gathering old property deeds for our subject house. Parts 1 & 2 constructed a preliminary narrative for the house's ownership history, by analyzing old property deeds and adding biographical information gleaned from census and other records (Part 1 examined 1920-1924, while Part 2 covered 1925-present).

Here, Part 3 will add a new layer to the analysis by gathering historical mortgage records from the county's Recorder of Deeds office.

Mortgage Records Basics

I have yet to delve into the details of county mortgage records, as I have with property deeds, so here are a few basics. You are with little doubt familiar with the term "mortgage" as a debt or loan entered into by the purchaser or owner of real estate, using the property itself as the collateral for the loan. Since a mortgage is essentially a lien or claim on the property by the mortgagee, a record for it is created and housed in the same government office as property deeds. Somewhere, a lawyer is cringing at my explanation.

Here, I will attempt to shed some light on a few of the gaps or mysteries remaining after the collection of property deeds. So what information can be found in the county mortgage documents? At first glance, and even upon closer reading, they appear very similar to the deed documents already collected and provide much of the same information-- names of parties involved; legal description of the property; references to earlier deeds and survey documents. You may also find further detail about structures on the property in a mortgage record.

The mortgage record begins in an almost identical fashion as the property deed documents.
Mortgages also add a key piece of information: the amount of money obtained in the loan. In my earlier lists of the title chain for the property, you've probably noticed that a number of the transactions listed only $1 as the consideration amount. Certainly, that was not the sale price of the property. However, a $1 consideration amount can be a clue that the grantee (buyer) may have taken out a mortgage in order to buy the property. Here is the previously shown list, with only deed information shown:
With the mortgage amount added to the consideration amount listed in the deed, we now have a dollar figure which is likely much closer to the market value of the home at the time. Two cautions here, to prevent you from taking this "adjusted" value as gospel: First, the history of residential mortgage lending suggests that there may still be a missing component, as during the early 20th century an individual could not fully fund a house purchase with a mortgage alone. Even through a second, simultaneous mortgage, one still needed to put at least 20% down on a home, and more often mortgage loans were for 50% or less of the home's value. Secondly, although it is the most common use of mortgage proceeds, owners do use mortgages to fund ventures such as renovations or a personal business. Yet, if the mortgage was recorded on or very close to the date of the deed, involving the same individuals buying the property, then it is very likely that said particular mortgage was used to fund the real estate purchase. We can still add these mortgages to further inform our understanding.

Adding Mortgage Amounts to the Title Chain

The first step here was to search the Montgomery County Recorder of Deeds mortgage database for pertinent mortgage records. This was done by searching the mortgagor index for each of the property owners on my title chain list (in person, at the office's self-service computer stations; the online database available from the comfort of my house does not provide complete information or allow you to view document images).

Notes from searching in the Mortgagor Index

As an example, Andrew F. Gutekunst is listed as the mortgagor on 18 mortgage records in Montgomery County alone, with 8 occurring in the 1920's involving property in Abington Township, and the remaining 10 occurring in the 1950's (some involving Abington properties, some elsewhere). Although it is not a bad idea to examine all of these mortgage documents to gain a greater sense of Gutekunst's collective real estate dealings, at the present we are mostly concerned with those mortgages pertaining to the subject house only. Since Mr. Gutekunst owned this property from November 10, 1923 to October 2, 1924, we are likely to find some more information in the mortgages under his name within or around those dates. It just so happens that Andrew Gutekunst took out a $3,800 mortgage loan executed on the same date as the purchase on November 10, 1923. I can now place this amount in a separate column on the title chain spreadsheet for this transaction, and add it to the consideration amount listed on the deed ($650) for a total "adjusted value" of $4,450.

For my particular property, I was able to find the following mortgages recorded on or around the same date as the property deed. Locating the property description on the mortgage records confirm that each mortgage bound this property as the collateral:

November 10, 1923: Andrew F. Gutekunst ($3,800)
October 2, 1924: Francis J. & Anna L. Coogan ($4,500)
July 14, 1927: Eugene A. & Mary B. Stout ($3,800)
July 14, 1927: Eugene A. & Mary B. Stout ($1,200)
October 17, 1932: John J. & Catherine Cantlin ($1,000)

I can now update the chain of title chart to reflect these as part of the "adjusted" price in the transaction:

Further Analysis

Although Frederick & Bertha Brandes, as well as Jayson Stover, did obtain mortgages in the early 1920's for properties in Abington, none of them relate to our subject property, nor do they correspond with their respective dates of ownership. The $1 consideration amount listed in each of their transaction maintains some missing detail, further evidenced by the use of the clause "and other valuable consideration" in the deed. We may never know what the other consideration was. As alluded to in Part 1, there may have been some land being swapped here.

Jumping ahead to Andrew Gutekunst's purchase of the property in November 1923, we can now see that since he obtained a $3,800 mortgage in conjunction with the purchase itself, the property likely had a value of at least $4,450. This puts the theory set forth in Part 1 that there was no home here at this time into question, as $4,450 is much more in line with the value of a property with a house than one without. We must now consider the likelihood that either Harry Renninger or Jayson Stover before him had the house built. Although the language in the mortgage document is not definitive as to what structures exist, the fact that the lending institution (Glenside Trust Company) stipulated that fire insurance must be maintained on the property is a strong hint that the house did indeed exist. One's research must always be open to re-evaluation of previous assumptions based on new facts. Instead of a 1924 construction date, I now believe that either 1922 or 1923 is the correct year.

Clause in Andrew Gutekunst's mortgage, requiring him to carry fire insurance on the property.

Francis and Anna Coogan took out a mortgage of $4,500 simultaneous to their $5,500 purchase of the house in October 1924, giving us an "adjusted value" of $10,000. This seems high to me for a modest bungalow at this time, even with real estate values rising throughout the 1920's. I am not taking too much stock in this $10,000 adjusted figure, as I will need to investigate further the Coogans having gone through a foreclosure of this property within months of acquiring the home. My initial speculation is that perhaps they paid cash for the house ($4,500) and simultaneously lived in it while also leveraging its value to gain funds for another purpose. It is not immediately clear. However, the mortgage document tells us that Harry Renninger may have again had some involvement, as the mortgage loan was obtained from his Remlu Building and Loan Association.

Eugene & Mary Stout obtained two separate mortgages, totalling $5,000, upon their purchase of the home in 1927. One, for $1,200, was to good ol' Harry Renninger, the previous owner. The second, for $3,800, was to the Remlu Building & Loan Association, the owner of the house immediately after the Stouts, and being a corporation of which Harry Renninger was a director. So, this is interesting, and in fact the second mortgage involving Renninger as the named mortgagee even defers to the Remlu B&LA mortgage as the primary lien:

Certification in the Stout's mortgage to Harry Renninger, which states that the Stouts first mortgage to the Remlu Building and Loan Association takes precedence.
I am again speculating here: Since the Stouts conveyed the property to Remlu B&LA less than two years later for $1, in 1929, yet continued living in the house until at least 1930, I am theorizing that the Stouts were unable to meet their mortgage payment terms, yet were able to perhaps come to some agreement with Remlu to exchange title to the property willingly in order to avoid eviction. It is interesting to note that this property transfer occurred on October 9, 1929-- less than three weeks before the stock market collapse known as "Black Tuesday". Although the crash had not yet occurred, this conveyance did occur during the roughly month-long period of warning signs leading up to the impending crash.

After the Remlu Building and Loan Association held the property during the initial Depression years, as we've already seen the John and Catherine Cantlin came along in 1932 and may have rented the house for a time prior to buying. They obtained a mortgage loan from Remlu for $1,000 in conjunction with the sale, giving us an adjusted market value of the house of at least $2,400. We have a strong indication here that the home has lost essentially half of its pre-crash value by this time, which is in step with the historical trends during the Depression.

Final Thoughts and Next Steps

Although it may appear that the inroduction of mortgage records has provided less clarity and more questions, in reality this only demonstrates that deductions based on prices determined from the property deeds alone cannot be fully trusted. The next document can always provide a further clue, and even though I have now adjusted my construction date estimate (to 1922-1923), it remains just a theory until further evidence hopefully provides definitive proof in the future.

Note that I left open the possibility that either Harry Renninger or Jayson Stover built the house during one of their ownership periods. I did not present the mortgage history of Harry Renninger here, because his involvement in multiple real estate companies makes it a bit unclear as of this time whether his transactions for this property were personal or professional. A search for him in the mortgagor index does reveal about 30 mortgages related to Abington Township, all between 1926-28. The laborious process of breezing through all 30 has not yet been completed, but since he purchased the house for the second time in 1925, after the likely construction date, any mortgages which happen to be related to this house do not necessarily tell us anything about the home's change in value. Still, I will not be sure until this task is done. Furthermore, other institutions named in these various deeds and mortgages had officers with the last name Renninger, who may have been relatives. The Renninger name is all over this property, and fairly, this community, during the late 1920's and early 1930's.

One thing is clear: I need to find out ALOT more about our pal Harry Renninger.

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