HELP!!!Record or not Record - Posted by Fred

Posted by Kerry_IL on March 03, 1999 at 15:06:43:

Someone from IL (I don’t remember who) researched IL RE law and posted that a provision in a contract prohibiting recording is un-enforcable.

I also include a provision in my contracts forbidding recording. As JPiper said, there is really nothing to prevent a buyer from recording, but it has been a
non-issue for me also.

HELP!!!Record or not Record - Posted by Fred

Posted by Fred on March 02, 1999 at 22:45:49:

I recently bought a house for $60,000. I have now have an offer to purchase my house for $75,000 on a contract for deed. The only thing that gets me is that the buyer does not want to record, because he is being sued and does not want any liens to be placed on the property. He is a mortgage broker and says if it is notarized, the contract is still valid. I have a first on the property for 58,000. Should I stay away from this buyer? How can I protect myself, if I decide to stay? Help!


Re: HELP!!!Record or not Record - Posted by Bill Gatten

Posted by Bill Gatten on March 03, 1999 at 14:09:35:


The guy’s willing to stick HIS neck out. He has no protection against you doing the same deal 2 weeks later with someone else. And he’s right: ownership is not convyed by recording. Recording is only for alerting the public to the fact that you have something worth being sued for.

My advice… take JPiper’s advice.


Re: HELP!!!Record or not Record - Posted by JPiper

Posted by JPiper on March 03, 1999 at 09:08:00:

As a seller I don’t record contracts for deed. There’s no need for YOU to be concerned about this?.it’s more of a concern for the buyer. He’s taking the risk if this deal is not recorded. By the way, I would have it notarized.

What should be of more concern to you is that you are entering into a transaction where you clearly don’t know how it works. This is always dangerous. Why don’t you pay an attorney $100 and ask a few questions? Matter of fact, while you’re at it, why don’t you have the attorney look over the contract and make any changes necessary to protect you?

Should you stay away from the buyer? Well I presume you have pulled a credit report. I presume he has made a down payment. I presume you have acquainted yourself with this lawsuit he is involved in, what it is about and why it arose. Some lawsuits would concern me less than others.

Finally your question of “How can I protect myself if I decide to stay” totally confuses me. If you sold on a contract for deed?you sold. You’re not staying whether you want to or not?.that’s the implication of a sale via contract for deed.

You owe it to yourself to understand what you’re doing. If you don’t, seek out legal advice. In general a sale via contract for deed by it’s nature, assuming that this mortgage broker has not modified the contract in some way, will be tilted in your favor as the seller. Do yourself a favor?.find out the rules of the game, or don’t play the game.


Re: HELP!!!Record or not Record - Posted by Laure

Posted by Laure on March 02, 1999 at 23:44:58:

I am not sure I understand your question, maybe it’s too late at night ! You own the house? You are trying to sell it? To a mortgage broker who doesn’t want the loan recorded? So what? Maybe I am missing something… The guy is giving you a down payment? He is going to make you payments? Why not Lease Option the property instead? Wait till his legal problems are solved. Just my thoughts. If I understand your situation correctly, I don’t see any reason why you must record your contract to sell to him. The recording protects HIM from you or your debtors.
Hope I helped.

Laure :slight_smile:

Re: HELP!!!Record or not Record - Posted by David Alexander

Posted by David Alexander on March 02, 1999 at 23:35:25:

if you are selling on a Contract for Deed you would rather not have him notarize or record the documents.
If they are not Notarized they can’t be recorded.
Why do you want to record them? Have you put your property in a land Trust? If you record them it will alert the world that you violated the DOS. it will also tell eveyone that you have transferred beneficial interest. As long as he knows he has bought the house
and make payments, whats the problem?

David Alexander

Re: HELP!!!Record or not Record - Posted by David Alexander

Posted by David Alexander on March 03, 1999 at 10:57:34:


You said you would notarize the Contract for Deed?
Why? I was under the impression that it is better to not notarize unless they ask you to, therefore they can’t record it themselves?

David Alexander

Re: HELP!!!Record or not Record - Posted by JPiper

Posted by JPiper on March 03, 1999 at 11:40:25:

If I were a buyer of a property on a contract for deed, and the contract is not notarized, I would simply fill out a memorandum of the contract, have it notarized, and then record the memorandum. Not notarizing the contract would not prevent this.

Alternatively, having a notarized signature on the contract is additional protection in a court. People have been known to claim they didn’t sign a document, that it is not their signature. A notarized signature is one additional protection to the seller. Notarization does not only benefit the buyer.

My contract prohibits recording. This isn’t to say that a buyer couldn’t record it anyway, but if they do it’s a breach of the contract, with a specific remedy in my contract. I’ve never had anyone attempt to record a contract. I’ve had all contracts notarized. It’s simply been a non-event.


Re: HELP!!!Record or not Record - Posted by David Alexander

Posted by David Alexander on March 03, 1999 at 13:19:55:

The contract I use also stipulates that it is a Breach
of Contract to Record it. I just didn’t realize until you pointed it out how Notarizing the document protects me as the seller also. I’m thankful for all your contributions and time because you help us that haven’t been there yet.

Thank You Jim,

David Alexander

Re: HELP!!!Record or not Record - Posted by Redline

Posted by Redline on March 03, 1999 at 12:55:25:

JPiper: Wasn’t there someone a while back that suggested it was ‘illegal’ or something to put in a clause that prohibits recording? (maybe just in Illinois?) Or am I thinking of something else. Whatever the case - I’m sure you have it figured out. Just curious.


It is against the law and a misdemeanor if you don’t record… - Posted by Rick Vesole

Posted by Rick Vesole on March 04, 1999 at 01:31:03:

…in Iowa. New law passed last year requires the seller to record to the real estate contract within 6 months after it is signed or else they are subject to a fine for failure to do so. I don’t know who wanted to get this passed, but it is now the law in Iowa.