Posted by Jim IL on December 29, 1999 at 15:39:42:
Scott,
Why not?
I always do, and have the insurance company name the trustee as the “additional inssured”.
The Lender is notified that the home has been placed into a trust and that all future docs etc are to be sent to the trustee at the trustees address.
Same with the insurance company.
So far it has worked out fine.
And, if the lender ever wants to see the trust agreement, fine, let them see it.
The trust agreement names the seller as the beneficial interest, so you are covered there.
The assignment of beneficial interest form stays with you, away from public view.
The lender can find out anyway, because the deed will be recorded and the tax bills sent to the trustee.
I just do not see why keeping the lender in the darl totally is a good idea.
Especially since IF something happens (the home burns down), the insurance proceeds will need to be taken by the trustee and handled.
Also, a power of attrny is a good idea, which allows the trustee or you to handle the funds if they are released into the sellers name.
I feel lucky to say that I signed a subject to deal in the middle of winter when things are pretty slow around here.
Anyway, I was hoping to get some advice on insurance and recording of the deed.
#1 Right now I have not recorded the deed (which I did take in a land trust) because I didn’t think it was necessary to alert the world or the lender (if they cared to look)of any transaction with this property. Maybe I’m wrong. The seller is fully aware of what I’m doing and I have an Affidavit of memorandum in case she gets flaky. So after reading some posts and my manuals on the subject I’m at a question of why to record the deed at this point. When I sell I can record and be in the chain of title if the new lender requires it.
#2 Now that I have control of the house I’m wondering how to approach the insurance issue. The current payment escrows for homeowners insurance so I thought our company could just be added to the current policy as additionally insured. My thought is since I have the deed, I need to get a new policy in our name maybe. Or if I keep it as is maybe I just need some vandalization ins. in addition to the sellers policy.
I thank you all for the advice. I also thank J.P for another year of this website. See you in Atlanta!
Re: Looking for advice on a signed subject to deal - Posted by Bob Meister
Posted by Bob Meister on December 30, 1999 at 09:05:09:
Did you do a title search already? If so, and it turned up with no clouds then I would record the deed. You need to have future tax notices and any other potential liens sent to you. Otherwise you could be caught with unpaid sewer bills etc, being cause for nastiness when you eventually decide to record your ownership interest. Your identity is shielded with the trust and banks shouldn’t care about the transfer into a trust.
I also fax notify the mortgage collecter and the insurer with owner signed documents, authorizing the changes.