eSignature Licitness for Real Estate in United States

How to eSign a document: eSignature licitness for Real Estate in United States

All right, in today's video we're gonna discuss deeds. Now, I'm not gonna talk about the different types of deeds in this video. If you want a video on the different types of deeds, go ahead and click right up here. The little "i" in the upper right hand corner. That'll take you to that video. Today we're gonna discuss basically the purpose, how we convey tile using a deed. Remember, conveyance of title simply means transfer of ownership. We're gonna talk about essential elements, what kind of things must a deed contain, for it to be legal and valid. And then what's the purpose of recording the deed. So let's get started. First thing we want to talk about is the deed. What's the purpose of the deed? Well the purpose of the deed is to transfer, to transfer ownership. Now we call that conveyance of title. Those two terms can be used interchangeably, and you don't know how the real estate licensing exam question is gonna be structured. So they mean the same thing. The other part is transferring title has a technical aspect to it. So we have the deed. Now the deed itself, is proof, of ownership. Now what I mean by that, is it's a proof that a conveyance of title has happened. All right? The other thing that it does, is the type of deed, and there are several different types of deeds. And again, check out that other video, to understand the different types. That represents the quality of the interest. That means the quality of the estate, because not every transfer of title or transfer of ownership interest is different. Some is fee simple absolute, where the grantor is providing absolute ownership to the new owner, the grantee. Other times, with a quit claim deed, for example, it may just be, "Hey, I think I might have some ownership, "but I don't really know to be honest with you. "And whatever I have here, you can have it." So the type of deed represents the quality of the estate, or what we call the quality of the legal interest in the property. Now there are several things that we have to know, that must be part of or included in that deed, for the deed to be valid. The first one is what we call the competency of the parties. So the buyer, the seller, or what we call the grantor and the grantee. They must be competent. They can't be mentally incompetent, those types of things. The mental capacity has to be there. Basically, they have to have the ability, the legal ability to enter into a contract. All right? The second thing is, consideration. Now remember, consideration, simply means something of value. It can be for the love and affection of a son or daughter. It could be a pile of dirt. It could be money. Typically, it is money. However, it doesn't have to be. And most of the time what we see on the deeds, to be quite honest with you, consideration is in the amount of $1, even though the property actually sold for $250,000. So, just one of those little trivia things there. But anyways, competency of the party, consideration, both of those must be evident in a deed. The next thing is what we call the granting clause. G-R-A-N-T-I-N-G. Granting clause. This is just a legal clause that's written into the deed, that basically says conveyance of title. So the granting clause is just conveying the ownership to the new buyer, the grantee. The number four element, has to be the legal description. Now, the legal description is different than the postal address. A lot of times the legal description will look like this. Particularly in plats. Lot one, block zero, and then you know, the subdivision name, Piedmont. Legal descriptions though, depending on the type of ground it is and the land, it can be quite extensive. I've actually seen legal descriptions that are over a page long. But typically in town type properties, it's limited to something similar to this. But no, it's not the postal address, it's the location. The legal description is described in the deed itself. The next thing, number five, is any deed restrictions. Deed restrictions can be things like covenants, or homeowner association rules, or those type of things. And deed restrictions, they have to be legal, first of all. But they can be very creative. For example, I seen a deed one time, that had a deed restriction that was placed in it from the 1920s. That said that the property is being transferred to my son, but if my son ever marries a member of the Smith or the Jones family, then the property would revert to the Catholic Church. So as long as the restriction is legal, it's okay to be in the deed and be enforceable. The next one is what we call the habendum clause. Habendum clause. (laughs) All these terms, right, these legal terms here. Habendum clause represents the quality of the estate. The quality of the legal interest, that's written into the deed. And again, a lot of it has to do with the type of deed, as we're gonna talk about. And then the last one, and most important. Well, I shouldn't say that, but it's the grantors', signatures. Now, here's the thing to remember, for your licensing exam. All grantors must sign, the deed. All of them, not a majority, not one out of two. Now here's what happens. So, if a corporation or a LLC, a Limited Liability Company, or a trust, or something like that, owns a piece of property, one of two things happens with the signatures. Within the articles of organization or the bylaws of that entity. They may have assigned someone, or a principal of that corporation, or a shareholder in that corporation, to have the signator authority. And if that's the case, then only one person signs on behalf of that entity. However, absent that language, all the principals within that corporation or that LLC, would have to sign the deed. We see this also in estates, where great-grandma dies and she had several kids, and even more grandkids, and even more great-grandkids. And people down line have died. I actually seen one time where, the title company required 91 signatures on the deed. So that's an extreme case, but the point is, anyone that has a legal interest in that property, has to sign, including spouses. Including spouses. All right, so those are the essential elements, that must be contained in that deed. Now the last thing I wanna talk about is, well two things. How does title pass? Passing title. Now remember, passing title means, transfer of ownership. And how that happens is the deed, that's a document. The deed must be signed, delivered, and accepted. So the deed must be signed by all the grantors, it must be delivered, to the grantee and the grantee, accepts. Very important. That's when title passes. The deed is signed by all grantors, it's delivered to the grantee, and the grantee accepts the deed. That's when title passes from a technical perspective. And the other thing we need to note, is recording. Now, a lot of people think that recording the deed at the court house is compulsory, or it's mandatory. And it is not. Now, if you're getting a loan on the property from the bank, part of the agreement that the bank's gonna require, that, "Hey, if you want our money, "then you're gonna agree "to record the deed at the courthouse." Now it's a really good idea to do that, but it is not compulsory unless it's the term, a condition of getting a loan. The reason we do it, and this is an important key real estate term that you have to know for your real estate licensing exam. We record deeds, so we're giving constructive notice to the world, that title has passed, or that I own this piece of property. And it's very important to prevent liens and encumbrances, to be a priority to ours. So that's for a different video, but that's why we record a deed. The thing you need to know is we record deeds, or other documents,