When selling a lot or condominium unit, a Subdivider must provide evidence that he has a marketable interest in the property. Further, the Subdivider must have the ability to make the property individually available for sale, free of liens and encumbrances before entering into a legal contract or agreement for the purchase by a prospective buyer.
There are only three forms of marketable interest that qualify for issuance of a Public Report:
1. Outright ownership (fee simple title by a Deed of record).
2. Interest as Optionee under an option-to-purchase agreement disclosed of record.
3. Interest as a beneficiary under a title-company trust agreement disclosed of record.
In any case above, or if the property is encumbered by a recorded Deed of Trust at the time of sale, the Subdivider must provide in his application for Public Report documentation indicating terms under which a single lot or unit would be available for sale independently, one-at-a-time, free and clear of liens and encumbrances.
If a recorded Deed of Trust fails to disclose a provision for partial release of individual lots, provisions may exist in the master loan agreement or promissory note that is not of record. We would need to provide the face page of any such document, and the page containing the terms under which partial releases can be obtained. If no provisions already exist, a letter from the Lender assuring availability of partial releases must be provided.
