Asked Vince - Equitable Title

Published Friday, September 21, 2018

Asked Vince …

From time to time agents will call or visit me with a situation they’re dealing with and ask my advice.  Now they know, and I make it very clear, that I’m not an attorney and I refer any and all legal questions to council.  However in my 40 years as a Realtor and my 30 plus years as an educator and my 11 years answering questions on the radio I’ve seen and researched lots of interesting circumstances.  Therefore I thought I’d write about some of them in this newsletter, with the same caveat that any advice I give must be discussed with a lawyer or the proper authorities.

A broker friend dropped by and asked about one of his seller clients who rented a building with the option to buy.  Soon after the renter/optionee moved in, he placed as for sale sign on the property.  The seller called my friend to see if it was OK … and my friend asked me.  Well, of course, the parties need to refer to the written agreement which my friend agreed to do.  Technically, however, the renter/optionee would have a right to sell the property because of something called equitable title.  The renter/optionee not only has possession but also the right to buy which, in fact, gives him the right to sell.  You see, after equitable title transfers so does the right to sell so the optionee could sell the property and exercise the option to purchase and the two transactions can happen simultaneously.

This is similar to a contract for deed or land contract purchase.  Because the buyer has a contract spelling out the conditions for the receipt of the deed, the purchaser has the right to list the property for sale and, of course, put a sign in the ground.

In the case of the renter/optionee the renter is doing nothing improper in advertising the property for sale.  

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  • Meet the Author: Vince DePaul

    Vince DePaul Vince DePaul is Director of Your House Academy. Vince began his real estate career in 1976 and is a real estate broker and a licensed real estate and continuing education instructor. He has taught real estate at College of DuPage in Glen Ellyn, Illinois, and Oakton Community College in Des Plaines, Illinois for several decades. For ten years he produced and hosted a weekly, live call-in radio broadcast in Chicago called “Your House” where he was known as “Mr. Real Estate.” In 2015, Vince received the prestigious Educator of the Year award from the Association of Illinois Real Estate Educators (AIREE). More about Vince »

A REALTOR® is a licensed real estate agent who is a member of the National Association of REALTORS®, (NAR) the largest trade group in the country.

Every agent is not a REALTOR®.  You become a REALTOR® after you pass your real estate course, pass the state license exam, join a real estate company and then join the National Association of REALTORS®.

According to the NAR, the term REALTOR has one, and only one, meaning:
"REALTOR® is a federally registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and subscribes to its strict Code of Ethics."

Michael Fair, President and Director of Your House Academy is an NAR member.