memorandum of option - Posted by Todd

import · January 10, 2003, 12:02pm

Posted by John Merchant on January 11, 2003 at 13:17:16:

Clarification: my Deed was a Quit Claim Deed, which only conveys what seller owns. And all I owned was a less-than-fee interest in the RE concerned.

As I’ve said many times on this and other boards, you, I, the guy next door, all have absolute right to give a QC Deed on ANY RE in the world to anybody. e.g. I’ll gladly give you a QC Deed to the Eifel Tower, or the Grand Canyon, etc. A QC Deed simply conveys what the grantor owns, without any warranty or statement that the grantor does have any interest.

I was frankly inviting a lawsuit by recording the deed-hoping the other guy would sue me so he’d have the burden of proof in court, the court costs,etc.

But he didn’t and won’t sue me, because he promised, in writing, to give me a deed to an undivided interest in the property…which he’s not yet done, and would be forced to do if he filed anything against me.

But again, this is NOT something to be done unless the recording party is VERY sure of his legal position; for non-lawyers probably something to be totally avoided, unless you’re ready and anxious to go to court and go to war!

import · January 10, 2003, 12:02pm

memorandum of option - Posted by Todd

Posted by Todd on January 10, 2003 at 13:02:07:

Does a memorandum of option for a lease purchase necessarily need to be notarized in order to record it? If so, can it be notorized in two steps i.e. have the owner sign and notarize it, send it to me and then I sing, notarize and record??
Thank You
Todd

import · January 10, 2003, 12:44pm

Re: memorandum of option - Posted by JT-IN

Posted by JT-IN on January 10, 2003 at 13:44:40:

Most States/Counties require that docs be Notorized before being recorded.

You can have a Notary acknowledgment under each signatory block for both the T/B and the L/S area of signing, and use two seperate Notaries. This is often doen when docs are handled via the mail, long distance or when each party is signing at different times. This should work nicely for you.

JT-IN

import · January 10, 2003, 7:27pm

State recording laws differ - Posted by John Merchant

Posted by John Merchant on January 10, 2003 at 20:27:32:

In some states one can record most any doc, but in some states such as CA, UT I know there are laws specifying what can, can’t be recorded.

I recall being very surprised to learn that CA wouldn’t allow recording of Notice of Equitable Interest in CA RE. This doc is recordable in a number of states without any restriction.

So far as I know all states do require a Notary’s Acknowledgement of signatures on the doc to be recorded, but one should check his/her own state to determine this.

County recorders will generally give you a written memo advising you what is/isn’t recordable with that office. While they are prohibited from giving legal advice (and they’re not really qualified to do so)they’re generally pretty helpful. Also local title company customer service people will usually know what is/is not recordable.

import · January 11, 2003, 8:30am

Re: State recording laws differ - Posted by George

Posted by George on January 11, 2003 at 09:30:52:

Hi John,
In CA, then, how would you protect yourself if you’ve optioned or l/o’ed a property?

import · January 11, 2003, 9:49am

Intrigue in CA - Posted by John Merchant

Posted by John Merchant on January 11, 2003 at 10:49:30:

S.481 of CA Revenue & Taxation Code, provides for a form that has to be used when recording a RE doc-called a Preliminary Change of Ownership Report.

This PCOR can probably be pulled up on any CA County website, and should be read and studied before trying to record anything in CA.

My experience arose from a deal on a CA RE property, and it became necessary for me to record something to protect myself when the other side welched on an agreement (in writing, but not acknowledged so per se unrecordable)and I had to find SOME way of recording my interest in the RE…other than the normal signed and acknowledged deed, lease, etc.

So I first tried the Memo of Equitable Interest, which I’ve used in other similar situations in WA and other states; but the CA Recorder’s clerk returned it with a letter saying it wasn’t acceptable.

After I studied the PCOR form in great detail, I determined the only thing I could do, was to Deed the RE from me (remember: I had never received my deed from the other guy!)to another entity, a Trust, which I control.

So I did draft, sign, have acknowledged then recorded that Deed from me to my trust.

The CA County Recorder couldn’t refuse to record that, so it was recorded.

Kind of an interesting side note: A little while later I got a call from the CA Co. Recorder’s office prying into how come I recorded a deed FROM me when they could find no deed TO me!

You ever hear of a Recorder doing any independent research? I sure hadn’t. Only one I ever heard of.

Anyway a woman did call, and we kinda waltzed around a little while she tried to pump me for info and I made every effort not to provide any. No CA law I’m aware of makes me explain anything, so I didn’t.

Back to the PCOR form, it does provide for recording of normal deed, deed of trust, lease docs so for 99% of all normal CA deals it’s broad enough to allow recording to protect the grantee.

The reader should be aware that it would be illegal to record any interest against a RE property, anywhere, if the recording party has NO legal interest in the property. Not only a civil wrong, but frequently a CRIMINAL offense too. So not to be done lightly!

I have read newspaper accounts of folks being charged and prosecuted for clouding titles, etc., so it’s something to be totally avoided if there is NO legal interest.

import · January 11, 2003, 10:08am

Re: Intrigue in CA - Posted by george

Posted by george on January 11, 2003 at 11:08:20:

They let you deed to yourself, without being deeded to???

Ron Legrand speaks of “stealing houses”, but really.
Thanks for your reply