Legal Question in Real Estate Law in California
is my loan valid even though I haven't recorded it for over 20 years
I lent a friend 20,000 about 26 years ago. We had the paperwork notorized (trust deed)and signed but i never recorded it..If I were to record it now would it be valid? If so would it be a lien on the property that was mentioned on the trust deed even though the owner sold it long ago or on the owner's new property.
Thank You!
1 Answer from Attorneys
Re: is my loan valid even though I haven't recorded it for over 20 years
You have a priority/ recording problem. The purpose behind recording in California is to give constructive notice to subsequent bona fide purchasers for value of your interest.
Had you recorded the trust deed, the new owner would be subject to the lien, because it would be prior to any interest that he received.
Although your borrower certainly knew about the trust deed, the subsequent purchaser did not, and if he did not have actual notice of the trust deed, he took the property free and clear, of any encumbrance that you would cause be recording now.
Very truly yours,
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