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<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060">Strange scenario – a real estate contract on the one hand AND a promissory note and deed of trust on the other hand. Without knowing more specifics about any of
these documents or repayment terms, here is my preliminary view on this.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060">Title may be transferred to the buyer by deed. In that case, the promissory note would still be unsatisfied and payment under the promissory note would still be
secured by the deed of trust. I would only do this on the following conditions:<o:p></o:p></span></p>
<ul style="margin-top:0in" type="disc">
<li class="MsoListParagraph" style="color:#002060;margin-left:0in;mso-list:l0 level1 lfo1">
<span style="font-size:10.0pt;font-family:"Arial",sans-serif">the promissory note has payment provisions similar to those contained in the real estate contract;
<o:p></o:p></span></li><li class="MsoListParagraph" style="color:#002060;margin-left:0in;mso-list:l0 level1 lfo1">
<span style="font-size:10.0pt;font-family:"Arial",sans-serif">the promissory note is secured by the deed of trust on the real property that is also the subject of the real estate contract; and<o:p></o:p></span></li><li class="MsoListParagraph" style="color:#002060;margin-left:0in;mso-list:l0 level1 lfo1">
<span style="font-size:10.0pt;font-family:"Arial",sans-serif">title is transferred to the buyer by way of a quitclaim deed, and not a statutory warranty fulfillment deed.<o:p></o:p></span></li></ul>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060">Now that I think about it, I wonder about the propriety and effectiveness of a deed of trust on property that the grantor does not yet own. Hmm. If there is any
question about that, I would require a brand-new purchase money note and deed of trust to accompany the deed.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060"><o:p> </o:p></span></p>
<div>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060">Mark B. Anderson<br>
</span></b><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#002060">ANDERSON LAW FIRM PLLC<br>
821 Dock Street, Suite 209, PMB 4-12<br>
Tacoma, Washington 98402<br>
+1 253-327-1750<br>
+1 253-327-1751 (fax)<br>
<a href="mailto:marka@mbaesq.com"><span style="color:#002060">marka@mbaesq.com</span></a><br>
<a href="http://www.mbaesq.com/"><span style="color:#002060">www.mbaesq.com</span></a><b><o:p></o:p></b></span></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-size:10.0pt;font-family:"Arial Narrow",sans-serif;color:#002060">CONFIDENTIALITY NOTICE<br>
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<p class="MsoNormal"><b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;mso-ligatures:none">From:</span></b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;mso-ligatures:none"> wsbarp-bounces@lists.wsbarppt.com <wsbarp-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>Timothy Lehr<br>
<b>Sent:</b> Wednesday, January 21, 2026 8:23 AM<br>
<b>To:</b> wsbarp@lists.wsbarppt.com<br>
<b>Subject:</b> [WSBARP] Seller financed and transferring title prior to payoff...pitfalls?<o:p></o:p></span></p>
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</div>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">All, <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I have a PC seller that sold a property on a seller financed RE contract a number of years back. There’s an executed promissory note and deed of trust. The RE contract contemplated a fulfillment deed to be recorded when the balance is paid
by buyer. There is still a balance owed, but seller wants to assist buyer by transferring title now so buyer can apply for flood insurance. Insurance company is saying she can only apply if she is the title holder.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Any pitfalls, considerations, or problems if seller transfers title now and keeps receiving payments via the promissory note?
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Thanks,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><b><span style="font-size:11.0pt;mso-ligatures:none">Timothy C. Lehr<o:p></o:p></span></b></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none">Attorney & Partner<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none"><img border="0" width="191" height="69" style="width:1.9895in;height:.7187in" id="Picture_x0020_1" src="cid:image001.jpg@01DC8AD5.367F93F0"></span><span style="font-size:11.0pt;mso-ligatures:none"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none">p: 360.855.0131<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none">e: <a href="mailto:timothy@stileslaw.com">
timothy@stileslaw.com</a><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none">w: <a href="http://www.stileslaw.com/">
www.stileslaw.com</a><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><b><span style="font-size:11.0pt;mso-ligatures:none">NOTICE</span></b><span style="font-size:11.0pt;mso-ligatures:none">: The information contained in this email is proprietary and/or confidential and may be privileged. If you are not the
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<p class="MsoNormal"><o:p> </o:p></p>
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