Does Notice Of Interest Cause Chain Of Title Issues?
John and others,
I know that many people suggest recording a document, such as a Notice of Interest or Memorandum of Agreement, to protect against the Seller from trying to go behind your back and selling a property to someone else after you've locked up the deal.
My question is, however, doesn't that cause chain of title issues if your seller should want to refinance in the next year or so?
Also, doesn't that recording potentially alert the lender of a sale, which can trigger the due on sale clause?
Thanks!
Martin
As you say, Notice of Interest is favored by some as means of protecting otherwise unrecorded interests.
It will be noticed if the title owner is attempting anything on the RE, and IMHO, and experience, will not be ignored.
A recorded Notice has got me paid in deals where, otherwise, the owner would have been happy to slip around me and dishonestly ignore our agreement, whatever it is/was...because he could NOT get his refi, or sale, etc. without dealing with my interest.
I'd caution you to have your agreement in writing, clearly setting out your interest in the RE, and signed, (notarized if possible*) before you even think of recording any such notice, as, otherwise it could subject to lawsuit for slander of title, etc
And if you can get the other guy to a Notary for acknowledgement, see also if you can't get him to give you a Deed for the interest, or a Deed of Trust...either of which is more easily recorded in EVERY state, and which has much more impact.