Public records contain detailed information about each parcel of real estate in a city or county. These records are crucial in establishing ownership, giving notice of encumbrances, and establishing priority of liens. They protect the interests of real estate owners, taxing bodies, creditors, and the general public. The real estate recording system includes written documents that affect title, such as deeds and mortgages.
Public records are maintained by:
In Illinois the recorder of deeds, county clerk, county treasurer, city clerk and collector, and clerks of various courts maintain these records. In Illinois, a recorder of deeds must be elected in each county with a population of 60,000 or more. In counties with a population of fewer than 60,000, the county clerk serves as the recorder of deeds.
Public records are just that: open to the public.
This means that anyone interested in a particular property can review the records to learn about the documents, claims, and other issues that affect its ownership. A prospective purchaser, for example, needs to be sure that the seller can convey title to the property. If the property is subject to any liens or other encumbrances, a prospective buyer or lender will want to know.
Recording
Recording is the act of placing documents in the public record. Any written document that affects any estate, right, title, or interest in land must be recorded in the county where the land is located to serve as public notice. That way, anyone interested in the title to a parcel of property will know where to look to discover the various interests of all other parties.
Illinois law does not require that most documents be filed or recorded within a specified period of time.
In Illinois, however, when creditors and subsequent purchasers do not actually know the content of the documents affecting certain real estate interests, the courts will hold these creditors and purchasers responsible for “discovering” (knowing) that information only as of the date on which the documents are recorded.
Tax deeds, by Illinois law, must be recorded within one year after the redemption period expires. A tax deed that is not recorded or filed within one year becomes null and void.
As a matter of Illinois law, no instrument affecting title to real property may include any provision prohibiting recording. Any such prohibiting provision is void.
The original document must be filed with the county recorder of deeds and must meet specific requirements (in addition to the nine requirements of a valid deed):
A deed in any language other than English, although valid between the parties, does not give constructive notice unless an official English translation of the document is attached at the
time of recording. The translation must be prepared by a credible source, such as the local consulate of a country in which the language is used.
Constructive notice
This is the legal presumption that information may be obtained by an individual through due
diligence — consulting the public documents. Properly recording documents in the public record serves as constructive notice to the world of an individual’s rights or interest, as does the physical possession of a property. Because the information or evidence is readily available to the world, a prospective purchaser or lender is responsible for discovering the interest.
Actual notice
This means not only that the information is available but also that someone has been given the information and actually knows it. An individual who has searched the public records and inspected the property has actual notice (buyer does this when he or she tours the property when looking at properties and shortly before closing), also known as direct knowledge. If it can be proved that an individual has had actual notice of information, that person cannot use a lack of constructive notice (such as an unrecorded deed) to justify a claim.
Constructive notice – could or should know with reasonable inquiry Actual notice – knows for certain by personal service
Priority
Priority refers to the order of rights in time. Many complicated situations can affect the priority of rights in a parcel of real estate – who recorded first, which party was in possession first, who had actual or constructive notice. How the courts rule in any situation depends, of course, on the specific facts of the case. These are strictly legal questions that should be referred to the parties’ attorneys.
Unrecorded Documents
Certain types of liens are not recorded. Real estate taxes and special assessments are liens on specific parcels of real estate and usually are not recorded at the time they become effective (January 1 each year for Illinois Real Estate Taxes), until some time after the taxes or assessments are past due. Inheritance taxes and franchise taxes are statutory liens. They are placed against all real estate owned by a decedent at the time of death or by a corporation at the time the franchise taxes became a lien. Like real estate taxes, they are not recorded.
In Illinois, a mechanic’s lien that has not been recorded may nonetheless still have priority over other liens that have been recorded
Chain of Title
A chain of title is the record of a property’s ownership. Beginning with the earliest owner, title may pass to many individuals. Each owner is linked to the next so that a chain is formed. An unbroken chain of title can be traced through linking conveyances from the present owner back to the earliest recorded owner. Chain of title does not include liens and encumbrances or any other document not directly related to ownership.
If ownership cannot be traced through an unbroken chain, a gap or cloud in the chain of title is said to exist. In these cases, the cloud on the title makes it necessary to establish ownership by a court action called a suit to quiet title. Often, the simple procedure of obtaining any relevant quitclaim deeds is used to clear title and establish ownership.
Title Search and Abstract of Title
A title search is an examination of all of the public records to determine whether any defects exist in the chain of title. The records of the conveyances of ownership are examined, beginning with the present owner. Normally, the root is considered to be 40 years. Under most circumstances, then, it is necessary to search only from the current owner to the root.
For normal title searches in Illinois, the search goes back 40 years under the Illinois Marketable Title Act. When the possibility of litigation exists, the search must go back 75 years.
A title search usually is not ordered until after the major contingencies in a sales contract have been cleared for instance, after a loan commitment has been secured. Before providing money for a loan, a lender or the attorney orders a title search to ensure that no lien is superior to its mortgage lien. In most cases, the cost of the title search in Illinois is paid by the seller.
An abstract of title is a summary report of what the title search found in the public record. The person who prepares this report is called an abstractor. The abstractor searches all the public records and then summarizes the various events and proceedings that affected the title throughout its history. The report begins with the original grant (or root), then provides a chronological list of recorded instruments. All recorded liens and encumbrances are included, along with their current statuses. A list of all of the public records examined is also provided as evidence of the scope of the search.
Marketable Title
Under the terms of the typical real estate sales contract, the seller is required to deliver marketable title to the buyer at the closing. To be marketable, a title must:
Although a title that does not meet these requirements still could be transferred, it contains certain defects that may limit or restrict its ownership. A buyer cannot be forced to accept a conveyance that is materially different from the one bargained for in the sales contract. However, questions of marketable title must be raised by a buyer before acceptance of the deed. Once a buyer has accepted a deed with an unmarketable title, the only available legal recourse is to sue the seller under any covenants of warranty contained in the deed.
