Somebody owns every parcel of land, Most Have Good Deeds, A Few Have Bad Deeds
Good Deeds and Bad Deeds, not the kind of do unto others kind, but property deeds. Having a bad deed show up before closing can be a deal stopper. Here are a few practical tips from things that I have come across in my real estate practice. I am not an attorney, but you can bet one will show up if there is a problem with a deed.
Here are some tips, some ah ahs and some OMG's.
- Get a pre commitment from your title company when you list a property. With all of the short sales, foreclosures and craziness that has gone on in the past 14 or 15 years, even in good times will often turn up problems that can be resolved but take time. I once thought with all of the digital technology I would not have to be concerned about this stuff, that was false thinking on my part. In one case, an in home financial/title official came to the house to close a loan for a re-fi and ended up recording the mortgage on the vacant lot next door on the deed. That was a mess. (Remember when you had to fog a mirror to get a mortgage?)
- Home Owners who "throw away" any of their title work, deeds that are recorded and returned to them, can be in big trouble if they ever have to prove owner ship by producing for examination their hard copy original deed. Think that does not happen? A nasty marital split years ago, a quit claim deed issued after an equally nasty court settlement, a deed drafters error of an invalid description, an owner that destroyed the original deed. Ahh, the answer, a scribner's Affidavit correcting the deed...but the drafter (scribner) is now a victim of mind failure in old age....back to court? Quiet title, re open the nasty law suit? Keep your deeds in a safe place. Value them as much as the money you paid to own the dirt you live on.
- Lost or misplaced documents/deeds, can cost one big time. Another, vacant land deal gets knocked off track because of lost documents that quit claimed from a trust some land to a relative. Years later, the trust is closed, no one kept the original trust docs, the unrecorded docs and the quit claim are nowhere to be found. To get a title that can be insured will take some doing, probably a "Quiet Title" court action. Get out the checkbook, it is going to cost that owner some money. Please remind your clients to Keep those documents in a safe place.
So, good advice to your clients and yourself: Think about a recorded or unrecorded deed as a pile of dirt as big as the land you own. It is the key to rights to that dirt. It is not your mortgage that has value, it is your deed to the dirt with all the improvements that are on it or in it that has the value. A safe, a folder that is in a fire proof doc box, a safety deposit box at a bank, any where it is secure. Don't let your Deed become a bad Deed. Protect it.