Re: To Deed or Not to Deed, that is the question. - Posted by GL
Posted by GL on June 18, 2000 at 08:22:14:
So far as I know there is no law requiring you to record anything. However you would be a fool not to record a deed, mortgage, lease, and anything else you can. It is your legal protection.
Here is a case that came to my attention about a week ago. It was told to me by a neighbor.
It seems his uncle, a man about 70, had a cottage which he had owned for years and owned free and clear. It is a valuable property, about $150,000. He sold it to a nephew (a different one)for a small down payment, or perhaps no down payment at all, and held a mortgage for the balance. The nephew then went to the bank and put on the biggest mortgage he could get, over $100,000 plus home improvement loans and whatever else he could get. The latest development is that he has taken the money and skipped out to Australia.
Now the old man has lost his free and clear property, because it is pledged for so many loans that it would cost more than it is worth to get it back. This never would have happened if he had recorded his mortgage in the first place. Then he would be the first mortgage holder and would be first in line to get his money. And all the other lenders would never have made the loans if they had known there was such a big mortgage on the property already.And they certainly would have known this as they would have done a title search and recorded their own loans.
If you do not record a deed or mortgage it might as well not exist from the standpoint of public record or legal recognition. If for any reason you need to prove ownership at a later day you will be in a hell of a legal snarl.