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Notice of Intended Sale: What Do I Need to Know?


Do your clients plan to purchase a fixer-upper and intend to flip a home for profit? If so, it’s important for you to be well informed on all the legalities behind such a venture and if anything has changed since you worked with someone who did rehab or flip a property.

One of the most overlooked steps in anticipating the end of your client’s project is recording a notice of intended sale. If you or your client forget about this step or disregard it as unnecessary, this could cause major repercussions during the closing process. 

What is a Notice of Intended Sale?

If you are an agent who frequently represents clients who rehab and flip properties that are not owner-occupied, you may want to suggest that your clients record a notice of intended sale. A notice of intended sale makes it more difficult for a contractor to claim lien rights on a property that is being renovated to be sold.

This notice must be recorded at least 45 days prior to the earliest date that the owner intends to sell the property, and it must include the closing date when the owner intends to sell the property to the purchaser. Additionally, a notice of intended sale must be recorded with the Recorder of Deeds for the county the property is located in.

How Can a Notice of Intended Sale Impact the Closing Process?

Recording a notice of intended sale can create a smoother closing process for a couple of reasons.

  1. Limits Mechanics Liens On Property

A notice of intended sale limits the amount of time that contractors have to file a mechanics lien on the property. Typically, they have six months from the date of last work, but a notice shrinks this time to a 45-day window before closing. This reduces the risk of a mechanics lien being filed against the property at a later date.

A mechanics lien may protect the contractors who are improving your client’s property for resale value.  If a mechanics lien is filed, payment must be made out of the sales proceedings. Having a notice of intended sale recorded properly protects your client from having liens placed on their renovation projects.

  1. Reduces Stress of Obtaining Lien Waivers and Paid Receipts

If a property has a lien, the title isn’t clear. In order to clear the title, paid receipts must be provided if the work has been completed. If the work exceeds $2,500 — which it usually does in a renovation — you will need to provide lien waivers as well as the paid receipts. Retrieving all of this documentation can be tedious and stressful. 

Filing a notice of intended sale alleviates the seller and agent of the stress of having to obtain lien waivers and paid receipts for prior work performed on the property. If a notice of intended sale has been recorded, you have better protection from mechanics liens preventing a clear closure process.

How Does Investors Title Help Agents?

At Investors Title Company, our expert title professionals work with you and your client to ensure a smooth closing transaction and title transfer. When selling a renovated home for a client, it’s important you have all of the information and resources you need for a smooth closure. 

We can help you navigate the complexities of a notice of intended sale so you can ensure a seamless closing and title transaction.

Are you an agent and looking for assistance with a notice of intended sale? Contact a residential title specialist at Investors Title Company today.