What is an Owner of Record? 8 Facts You Need To Know

The beneficiary named as the owner of record for a trust or estate is the owner of record. A will or trust may identify the owner of record, or it may not indicate the owner of record.

If no owner of record is named in the trust instrument, the trustees have extensive authority to appoint anybody as the owner of record.

What is an Owner of Record?

An owner of record is a person whose name appears in public documents as the owner of an asset such as real estate, a mortgage, or stocks and bonds.

What is an Owner of Record?

Several alternative names are used to indicate the owner of record, some of which are exclusive to a certain form of property. For instance, a person who possesses shares of stock may be called a stockholder of record or a shareholder of record.

What rights does a owner of record have?

The owner of record has complete usage rights to any assets kept in his or her name. When it comes to real estate, the owner has the option of making changes or even selling the asset.

As long as the owner has complete control of the property, there is no need to seek permission from any other party, given the activities comply with the local community’s norms and standards.

The same holds true when dealing with other assets, such as stock shares. A shareholder can take measures to sell any shares in his or her possession or keep them for the long term.

Assuming the investor is a registered holder, he or she can typically participate in any voting activities involving investors holding that particular sort of stock. A registered holder also receives dividends and any other distributions associated with the shares of stock.

The owner of record of a property may also be compelled to maintain the grounds in accordance with the local government’s regulations. Failure to comply might result in penalties and other legal actions, including the seizure of the property.

For example, if the owner of a vacant lot in a residential portion of a city fails to maintain the grounds weeded and mowed, the city may have the authority to clean up the site and bill the property owner for the cleaning.

In the event that the owner fails to pay the bill, the city may issue further fines or even seize the property until the owner has properly compensated the city for the work and any accrued fines.

Responsibilities Of an Owner Of ecord

In addition to rights and benefits, a legal owner of assets is also obligated to fulfill certain tasks. Typically, real estate is subject to yearly or semi-annual property tax payments to local governments.

What is an Owner of Record?

Many jurisdictions require homeowners to maintain insurance coverage for the property and any constructions on the grounds.

If taxes are not paid, the local government may confiscate the property to settle the tax obligation. Similarly, failing to keep homeowner’s insurance might result in an increase in these taxes or a fine.

Record Owner

It is crucial to know who the property owner is since many actions in common interest projects need the property owner to be the Record Owner. Regarding association-related problems, only the Record Owner can make decisions on behalf of a unit/lot.

Typically, resolving association ownership disputes is as simple as identifying the property owner mentioned on the recorded grant deed.

Prior to mailing votes or having formal member meetings, a board or management should be able to determine who the property’s genuine Record Owner is by careful preparation and organization.

The majority of CC&Rs stipulate that homeowners must supply the association with the names and addresses of Record Owners.

In reality, Company Code section 8320 requires the corporation or unincorporated non-profit organization to keep a list of all homeowners’ addresses.

Even before an annual meeting, the organization must determine who the record owner is for purposes of collecting assessments and enforcing the governing articles.

Because state statute provides that the levy of assessments is a debt of the owner at the time the assessment was levied, pursuing the correct owner for payment is crucial, not only for the association’s financial health, but also to limit the association’s liability for proceeding against the incorrect person or entity for a debt.

A documented interest has precedence over an unrecorded interest under the law of California.

This implies that if two owners claim a right of ownership to a piece of land, the association should recognize the Record Owner, who is mentioned on the documented grant deed, as the genuine owner.

The same remains true even if the homeowner gets ownership to their unit/lot through a quit claim deed, if the document is recorded.

When an unrecorded grant deed is involved, when more than one individual claims a right of ownership under a different documented grant deed, or when a representative of a trust claims ownership, the situation might get muddled.

If there is no registered deed or if more than one recorded deed is found. According to the Davis-Stirling Common Interest Development Act, only documented interests shall be referred to by management.

Other rules that are not particular to homeowner associations allow that a grant deed is lawful and enforceable even if it is not registered, so long as it provides notice to all parties.

However, it is more frequent to discover that the notice of ownership has not been sent to all prospective purchasers and does not meet legal notice requirements.

First In Time, First In Right

If there is an ownership dispute between record owners and management does not know who to allow to vote (who gets the ballot), management should rely on Civil Code Sections 1213 through 1220, which state that when there are multiple grant deeds, the “Record Owner” is the person(s) whose grant deed was recorded first.

What is an Owner of Record?

For example, if a homeowner recorded her or his deed to a unit/lot in 2002 and a subsequent grant deed for the same unit/lot was recorded by another person in 2003 without a chain of title satisfying the transfer of property, the Record Owner would be the homeowner who recorded first.

Trust Ownership

When property is held in trust, an issue that is becoming increasingly common develops. When performing check in at an official meeting or mailing out a paper ballot, if a trust ownership is submitted, the association should need formal confirmation that the individual wishing to vote on behalf of the trust is entitled to do so.

Typically, the individual serves as trustee. Interestingly, although the trustee does not own the property, he or she has the same legal powers to act on behalf of the property as would be accorded to any other organization member.

It is the responsibility of associations to inform homeowners that, if they are trustees of a trust, they must present trust papers to demonstrate that they have the power mentioned above.

Usually, it appears that the ownership issue is mainly a concern during contentious elections or when particular association members have an agenda. The objective of management is to ensure that the appropriate owners reflect the memberships of the organisation. Success is certain if you adhere to the preceding rules.

Issues with Designating Seller as “Owner of Record”

The main issue with this categorization is that it may not be feasible to determine the true identity of the vendor.

This is especially troublesome for bank-owned (“REO”) properties acquired through foreclosure or deed-in-lieu-of-foreclosure, as the real owner of the property may not be recognized owing to many transfers or assigns of the underlying debt.

In reality, the majority of contracts we encounter with “Owner of Record” as the seller are for the sale of REO property, probably because the identity of the owner is possibly in dispute.

Another perilous circumstance in which we frequently find these types of contracts is a flipping scam in which the supposed seller does not yet possess the property, but is under contract to acquire it and intends to flip it shortly after closing.

In some instances, the supposed seller does not want the buyer to realize that s/he does not truly own the property and wants to flip it for a quick profit. Clearly, a contract executed by a seller who does not possess the property at the time it was signed is invalid.

What is an Owner of Record?

In addition, many real estate professionals believe that a contract with the “Owner of Record” seller designation is legally invalid because the seller’s genuine identity cannot be determined.

Who does the buyer sue if the seller breaks the contract or if a title problem occurs after the sale if the seller’s name is unknown and he or she is only identified in the contract as “Owner of Record” with an illegible signature?

For these reasons, more and more title insurance underwriters are rejecting contracts with “Owner of Record” as the seller.

Real Estate Tax Tips for the Owner of Record

Deducting mortgage interest

The tax deduction for mortgage interest is one of the greatest tax benefits for property owners. In principle, you can deduct the interest you pay on a house loan provided you (and the loan) satisfy the following three requirements:

The mortgage is secured by your primary dwelling and/or a second property.
The residence serves as security for the mortgage.
You possess a property ownership stake.

In January of each year, your mortgage lender will often send you a copy of Form 1098 indicating the amount of interest paid on your loan during the prior year, which you may use to complete your taxes.

However, the IRS does not need you to be legally responsible for the loan in order to deduct the interest. In other words, you can deduct mortgage interest even if your name is not on the mortgage as long as you are the record owner and paid the interest payments.

Deducting mortgage ‘points’

In real estate parlance, a “mortgage point” is a charge paid at closing equivalent to 1 percent of the loan amount. Two points on a $200,000 mortgage would cost $4,000, for example. Points may be paid by buyers in exchange for a lower interest rate or as a requirement for getting a loan.

Points are frequently tax deductible, and when they are, the buyer of the house typically gets to claim the deduction regardless of who paid the points. It is fairly unusual for house sellers to agree to pay points on behalf of a buyer if doing so would assist complete the deal.

Real estate tax deduction

Property owners can often deduct the property taxes they pay on their tax returns. This is applicable beyond your house.

In general, any real estate tax paid to a municipal, state, or foreign government is deductible, provided that the tax is levied at a certain rate depending on the property’s valuation.

(Special tax levies for improvements such as paving the pavement in front of your home generally do not qualify for a tax exemption.)

According to the Internal Revenue Service, in order to deduct a tax on your income tax return, “the tax must be levied on you” and paid to the taxing authority. Typically, only the recorded owner of a property is subject to property taxes.

Indeed, one of the primary duties of the official property records maintained in county courthouses across the nation is establishing who is liable for the tax on each property.

Buyers, sellers and property taxes

Property taxes are so intimately related to ownership status that, when purchasing or selling real estate, the tax deduction depends not on who paid what, but on who owned the property at the time.

What is an Owner of Record?

  • As with points, house sellers will occasionally agree to pay a part of property taxes on behalf of the buyer, or vice versa. This agreement is entirely between the two parties involved.
  • The IRS considers the seller to have paid all applicable taxes up until the day of the transaction.
  • The buyer is deemed to have paid all applicable taxes for the date of sale and subsequent dates.

Suppose, for instance, that you purchased a home on August 23 and that the annual property taxes on the residence are $5,000.

  • From January 1 through August 22, or 234 days, the vendor was the recorded owner.
    • That equates to 64,11% of the year.
  • The buyer is the legal owner for 131 days, or 35.89 percent of the year, from August 23 to December 31.
    • The seller may deduct $3,205.48 (64.11 percent of $5,000) whereas the purchaser may deduct $1,794.52 (35.89 percent of $5,000).


An owner of record means someone who has legal control over assets. When a business buys an asset, it usually means the seller will retain ownership and be a beneficial owner. When a person buys an asset, he/she usually becomes the new owner.

An owner of record is responsible for all the costs associated with completing the project. They are also responsible for taxes, liability and the health benefits of their employees.

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Pat Moriarty
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