Recordation

Definition of "Recordation"

Written by

Janet Zettler

Zettler Properties

The meaning of recordation defines the act of recording deeds and various property documents in a public registry office. Recordation proves ownership claims on a property or other assets. Also, it attributes a legal framework for financial claims. A public recordation safeguards proprietors from any unrecorded or unfounded claims. 

What does recordation mean in real estate?

One shouldn’t confound recordation with closing. Usually, recordation in real estate

is part of the closing process, the final stage in a property transaction. Recordation takes place at any given moment when the parties involved in real estate sales register an asset-related document in the public records. Subsequently, recordation implies that the lender transfers their mortgage, and the parties finalize the title transfer.

As opposed to recordation, closing refers to the entire process of buying and selling real estate, covering mortgage preapprovals, opening an escrow account, etc. 

The fees you have to pay for recordation

When escrow closes, both sellers and buyers will have to pay closing expenses. One of them is the so-called recordation fee. In every US state, local government agencies determine the amount of the overall costs for recordation. They will record deeds and legal documents into the public record in exchange. Therefore, the whole transaction assumes legality.

The course of recordation in real estate

Buying a house and the documents proving the transaction's authenticity are public. Note, however, that recordation and recorded documents don't attest ownership. Instead, the property title determines an asset's legal control. Recording implies that you file your deed and mortgage at your local government's county office. There, they will attribute the resulting document with a stamp and date. 

If you don't follow this legal course, problems can occur. It can result in disputes over property ownership. Secondly, you may encounter difficulties when applying for a mortgage. Until you don't complete your recordation, the mortgage banker and even the county recording office can indeed prevent you from moving into your new home. In short, everything should be made part of the public record constantly available for your local county.

Nevertheless, not only deeds and real estate documents can be subject to this process. You can also make mortgages, foreclosures, subdivision confirmations, and easements public. Typically, your legal counselor or title company will hand recordable papers over to the recorder's office. Once there, a county clerk will manage the recording assignments.

Why is recordation beneficial for you?

Recordation essentially ensures identifiable succession in the history of a title to a property. Recordation regulations vary from state to state. Occasionally, laws differ in counties within the same state. 

Let's see the act of recordation's positive effects! Every state in the US passed a recording act according to which a person declaring an interest in real estate should previously establish their claim to said real estate in a legal procedure. 

Now, let's suppose that a dishonest individual or dealer in land intends to sell the same land numerous times. Still, recordation creates an adequate notice to future buyers about an earlier conveyance or title transfer. Thus, recordation provides the owner with legal protection in the advent of the following (unauthorized and unfounded) conveyance.  

In another instance, two applicants may emerge with a clashing deed and competing claims to real estate. Then, they use the recordation date to define the progression in ownership in time. Most generally, the records clarify the dispute, establishing the right to that individual who has the most recent deed.

A different version to the scenario before-mentioned is the following. A property seller can sell the same real estate and convey the deed to two buyers. Let's suppose the first buyer neglected the recordation process, and the second buyer wasn't aware of the first party. Additionally, the second interested party was resourceful enough to record the property title. Then, the latter buyer has the upper hand in getting the property in most US jurisdictions.