After Signing a Sales Contract for Land, Does It Need to Be Recorded?

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State laws establish the rights that property owners have after they purchase real property or receive real property gifts. Property owners who purchase land are not required to record their deeds but if they fail to record them, they may lose their rights to ownership or may be unable to sell their property for lack of marketability. Furthermore, if land purchasers borrowed money to buy their land, their lenders will require them to record their ownership interests.

  1. Overview

    • Individual states have land recording statutes governing the rights that property owners have when purchasing land. In most states, the state or county register of deeds, land records office or clerk of the circuit court is responsible for maintaining state registration and recording records. Although state laws vary, most states base their recording statutes on the Uniform Marketable Title Act (UMTA).

    Uniform Marketable Title Act

    • To minimize the opportunities for purchasers to buy property with unrecorded deeds or under defects, the National Conference of Commissioners on Uniform State Laws drafted the Model or Uniform Marketable Title Act (UMTA). This provides states with suggested model language and encourages state legislatures to enact similar property-recording laws to achieve a uniform recording system. Based on common law, the UMTA suggests that title is valid and marketable if a search reveals an unbroken chain of title going back at least 30 years. As such, title examiners performing title searches in states that have adopted the UMTA are only required to search a prospective owner's chain of title for the last 30 years.

    Null or Void Conveyances

    • Similar to recording laws governing residential real property, state laws also give owners the same rights to record their undeveloped or raw real-property purchases. States typically record residential real estate and undeveloped land using a common system of locating or recording transactions using metes and bounds. In states that have adopted the UMTA, owners of residential real estate or undeveloped land do not have a legal basis to claim ownership of land that was unrecorded within the last 30 years, or improperly recorded. Thus, if an owner purchases land in 2011, and his title examiner searched the county land records for the last 30 years, a third party could not claim ownership to land that was not recorded before 1981. According to the UMTA, all land interests predating 30 years would be null and void.

    Exceptions

    • UMTA provides an exception for land owners who purchase developed or undeveloped land within the last three years before claiming ownership. The exception applies if they paid property taxes even if they failed to record their deeds. Furthermore, the federal government's ownership right preempts state statutes, so states or private individuals are not valid owners of improperly recorded or unrecorded federal deeds.

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