When considering a real estate transaction, as either a buyer (grantee) or seller (grantor), start by reviewing the state's property laws. Title 35 of the Code of Alabama contains the rules that govern real estate deeds for the state.
The real property section declares that anyone wishing to convey land must be at least 19 years old (35-4-1). Any instrument conveying interest in lands (a real estate deed) must be written on parchment or paper and signed at the end by the grantor or an authorized representative. If the grantor is unable to write his/her name, someone else must enter it on the document with the words "his mark" written on or near the name. Standard signatures only need one witness, but marks by non-signing grantors require two witnesses to ensure the validity of the transfer (35-4-20). The notary, who must acknowledge the signatures, may serve as the sole witness where required, and as one of multiple witnesses when needed (35-4-23).
Generally, deeds require a recital of the consideration (money or something else of value) the grantee pays to the grantor in exchange for an ownership interest in real estate. In Alabama, however, there is no need to provide that information (35-4-34). Even so, as of August 1, 2012, each deed submitted for recording must include a real estate sales validation form and documentation verifying the sale price or actual value of the property (40-22-1).
One of the most important details on a real estate deed is how multiple owners decide to hold title to the land. Joint tenancy in Alabama does not automatically include rights of survivorship. Instead, when a joint tenant dies, the interest is severed and passed on to his/her heirs, just as in tenancy in common. If co-owners want a survivorship tenancy, where the deceased owner's rights automatically pass to the survivor(s), the deed must specifically state that intention (35-4-7). For example: "John Doe and Richard Roe, as joint tenants with rights of survivorship."
Warranty deeds contain specific terms that imply protective covenants between the grantor and grantee. "In all conveyances of estates in fee, the words "grant," "bargain," "sell" or either of them, must be construed, unless it otherwise clearly appears from the conveyance, an express covenant to the grantee, his heirs and assigns, that the grantor was seised of an indefeasible estate in fee simple, free from incumbrances done or suffered by the grantor, except the rents and services that are reserved; and also for quiet enjoyment against the grantor, his heirs and assigns, unless limited by the express words of such conveyance; and the grantee, his heirs, personal representatives, and assigns may, in any action, assign breaches, as if such covenants were expressly inserted" (35-4-271).
Grantors may reserve any beneficial power to themselves that they "may lawfully grant to another" by clearly defining their intent within the body of the deed. Additionally, the grantor may make such reservations "to himself, for his own benefit, [with] an absolute power of revocation." In this case, "such grantor must be taken as the absolute owner of the estate conveyed, as to the rights of creditors and purchasers," suggesting that a conveyance with a reserved power of full revocation is not completed until the reserved power ends, often at the grantor's death (35-4-290).
Recording is the process of officially entering the deed into the public record. Nearly all states require recording real estate transactions, but sometimes it is difficult to know which documents must be recorded. Alabama specifies that, except as "otherwise provided by the Uniform Commercial Code, all deeds, mortgages, deeds of trust, bills of sale, contracts or other documents purporting to convey any right, title, easement, or interest in any real estate . . . , when executed in accordance with law, shall be admitted to record in the office of the probate judge of any county. Their filing for registration shall constitute notice of their contents" (35-4-51). Even though 35-4-51 states that the documents may be admitted to record in any county, "conveyances of real property shall be recorded in the county in which the property is situated" (35-4-62).
One important reason to record real estate deeds is that recordation serves as constructive notice to the public of a change in the ownership status for a specific piece of real property. Constructive notice is the legal expectation that an individual will be aware of information that is available in the public record. Even if the deed is not immediately entered into the record, a "conveyance or other instrument is operative as a record from the day of the delivery to the judge" (35-4-59). Further, "recording in the proper office of any conveyance of property . . . operates as a notice of the contents of such conveyance or instrument without any acknowledgment or probate thereof as required by law" (35-4-63). This is possible because, as per 35-4-58, the delivery date and time must appear at the foot or in the margin of each instrument submitted. Additionally, the "judge making the record of any conveyance or other instrument must certify on the same when it was received and recorded and in what book and page the same is recorded."
If the deed is not completed correctly, the judge may withhold certification of filing, or refuse to record the deed until all registration fees are paid and the document is "witnessed, probated or acknowledged as required by this Code." Other reasons for a judge to refuse recording a deed are a missing recitation of the grantor's marital status (35-4-73); a legal description that refers to a plat, but omits the plat or its location in the records, and the associated metes and bounds description of the land (35-4-74); or a missing or incomplete "prepared by" statement that includes the name and address of the individual who prepared the instrument (35-4-110).
Disclosing the grantor's marital status on the deed is important even if the spouse has no material interest in the property. Moreover, if the land is identified as a homestead, "no mortgage, deed or other conveyance of the homestead by a married person shall be valid without the voluntary signature and assent of the husband or wife" (6-10-3).
Alabama follows a notice recording act for its deeds. The notice recording system uses recording to protect future bona fide purchasers (buyers for value) who acquire title to real property owned by an individual or entity who did not submit the conveyance for recording, but offers no protection against prior buyers (35-4-90). For example, A sells land to B. B, in direct violation of Alabama law, fails to record the deed. Later, A sells the same land to C, who records the deed immediately. Because there was no record of the earlier transaction, C, the subsequent purchaser, keeps the land and B, the prior grantee, gets nothing.
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