Setting the Example: Bergen County Migrates 370,000 NJ Deeds to the Blockchain

Bergen County, New Jersey has jumped on the blockchain train. The county is digitizing all of its property records. The County Clerk has inked a five-year contract with Balcony Technology Group, a blockchain-focused records company based in New Jersey.  

Once they’re digitized, 370,000 property deeds (representing $240 billion in property value) will migrate to the blockchain-based deed system. Bergen County’s digital overhaul could well be a trend-setter. It’s the first for a major U.S. county.

What Are the Costs and Benefits of Migrating Deeds to the Blockchain?

First, the costs. The Balcony Group, which specializes in land record management, will bill the Bergen County Clerk’s Office $100K annually through the five-year contract term. Payments will come from the County Clerk’s trust fund. This means the office’s own administrative fees can cover the costs. Presumably, the $500K is an investment. Once digitized documents are in place, costs should go down.

Now, what advantages will Bergen County gain through this partnership? Balcony reps say the platform will:

• Establish a database for digitized chains of title for real estate in all 70 towns in Bergen County. The system will provide a searchable chain of title for each address.

• Slash deed processing time. The Balcony Group says to expect deed processing time to be less than 10% of the time it takes today.

• Resist manipulation, deter hackers, and wall off the deed fraudsters who have menaced homeowners and county clerks for generations. A fraud-free system is the goal.

• Flag administrative mistakes in real time. Keep employees from falling victim to phishing and ransomware. (Across the United States, nearly three in four ransomware hits threaten to hold up office operations until they get $1 million or more.)

• Make title disputes, title defects, and tangled titles less common.

So, while the United States has a dependable deed recording system today, blockchain’s tamper-resistant traits could make a positive difference for tomorrow.

How Does Blockchain Technology Work With Deed Records?

Blockchain is the technology that cryptocurrency uses. But it has a lot more potential. It is a recording mechanism, inherently. It lends itself to the creation of a secure, public ledger.

With blockchain, a property deed is authenticated and etched into a digital ledger. It works like this:

• A transaction forms a block. Each new block attaches to the previous block.
• Blocks, once on chain, can’t be changed. The integrity of data is safeguarded.
• Because a blockchain network won’t allow multiple transfers into the ledger for the same piece of property, the chain of title to a home is also safeguarded.

• The rightful deed holder receives a private, digital key representing the right to transfer property.
• The chain can be searched by anyone involved with a transaction. A search clearly shows claims, covenants, and title restrictions.
• The history of deed holders and deed claims is consistently traceable. There is always a clear chain of title — the holy grail for deed recording offices.

Balcony Technology has chosen the Avalanche blockchain network to establish the ledger for New Jersey County. The results will be authenticated records, the company says, that no one can alter. According to Balcony founder and CEO Dan Silverman, the new system make fraud “obsolete.”

How Did the Idea Take Hold in Bergen County?

Bergen County, just across the Hudson River from New York City, is home to nearly a million residents. That’s more people than in any other New Jersey county.

John Hogan is the County Clerk. Hogan has been following blockchain technology since 2019. He has professional experience in the area, having worked on the New Jersey governor’s blockchain task force. Hogan says he’s kept Bergen County at the leading edge of technology and is now committed to bringing deed management up to date.

With that aim in mind, Hogan’s office tried out Balcony’s system with a limited number of deeds. The system worked. Hogan then decided to enter into the five-year arrangement with the company. According to Hogan, the new system of deed recording will make people’s lives better. That’s because deed transactions will become transparent, streamlined, and secure.

Bergen County’s residents will be able to use the system from the comfort of their homes. They will be able to pull up and trace the history of their deeds from the time the deed came into existence.

The CEO of Balcony, Dan Silverman, says the residents will see a user-friendly, attractive platform — like the modern websites created by Zillow and similar real estate companies. Silverman says the initiative is committed to “the belief that government can and must evolve.”

Will Blockchain for Deeds Catch On in Other Counties?

This major news means Bergen County, New Jersey has just kicked off the largest blockchain initiative of its kind in the country. No doubt, officials in other counties, cities, and states will be watching the new system take shape. 

We can expect the first year to be the most challenging. Turning manually recorded documents into digital data will take serious attention and time at the start. Today, in a given U.S. county, there could be many unrecorded deeds and claims on the titles to people’s homes. The transition to digital deed records risks the problem, at first, of recording unclear titles on the blockchain.

But as county recording systems go, it appears that Bergen’s is in relatively good shape. This is due, in part, to the county clerk’s confidence in the importance of modernizing public records. County Clerk Hogan knows the initiative is a historical milestone. Hogan says the county is now just “setting the example” for a real estate information infrastructure. The work will take time to accomplish. The CEO of Balcony agrees. This is about installing a foundation for automation that will carry the county through generations. As Balcony sees the project, it’s a sample that other counties, anywhere in the nation, can adopt as well.

Balcony is already working with other city and county clerks in New Jersey. These include Camden, Morristown, Cliffside Park, and Fort Lee. Balcony is also working in Orange County, where the company found nearly a million dollars in city revenue that would have been lost on account of faulty record-keeping. The company’s findings indicate the need for a better method of record-keeping.

Not long ago, blockchain-based deed systems felt futuristic. With Bergen County now implementing a real-time system, that future milepost no longer seems distant. The Balcony CEO calls the project a “turning point” for government records, and expects the company to expand beyond New Jersey.