What a steal: A house for only ten dollars!


When I was signing the papers for a house purchase many years ago, I noticed that the deed papers read

The Grantor «names of people selling the house»
for and in consideration of TEN DOLLARS AND OTHER GOOD AND VALUABLE CONSIDERATION
in hand paid, conveys and warrants to «me»
the following described real estate...

I noticed that I technically was buying the house for ten dollars.

The closing agent explained, "Well, ten dollars and other consideration. This is just a convention, so that the actual amount paid for the house doesn't go into the record." It also saves them from having to revise the document each time the price changes. (I don't buy the "doesn't go into the record" argument, because you can still look up the actual sale price from public records. But this back in the days before Zillow, where this sort of information was not available online and if you wanted to look up this information, you had to gasp physically visit the county records office.)

When I told this story to one of my friends who was also buying a house, he said, "Cool. I'm going to ask them to put down $20 when they draw up the papers for my house."

Therefore, according to the title transfer records, he paid twice as much for his house than I did mine.

Comments (24)
  1. BrianS says:

    I've seen a lot of this in the course of doing my genealogy research.  Used to be a time when it was a dollar and no additional consideration in most cases (at least back east here in NY/NJ).  Of course back then, mortgages were typically for 3 years, 6% interest per year, 2 payments per year.  I'd assume that most states are alike in that the actual selling price can be determined by the taxes paid when the records are filed.

  2. Gabe says:

    Did it really say "OTHER GOOD" where I would expect it to say "OTHER GOODS", or is it just a typo?

  3. Lukas says:

    Gabe, the other consideration was good and valuable. Not a typo.

  4. Silvanis says:

    @Gabe: You're parsing it wrong. "Good and valuable consideration" where good = legal and valuable = the buyer giving up something significant to them. "Other goods and valuable consideration" would imply that you're using more than just cash to buy the house.

  5. Joshua Ganes says:

    I'm new to this concept, but clearly ten dollars is ridiculously low for a house. It sounds like someone is trying to get away with something to me. What would be different if the actual dollar amount were printed on the deed?

  6. No One says:

    @Joshua Ganes: "so that the actual amount paid for the house doesn't go into the record" and "saves them from having to revise the document each time the price changes".

  7. Joshua Ganes says:

    @No One: Yes, I read the article. As I said, I don't have a whole lot of knowledge about real estate. What would the amount paid going on the record imply? Higher taxes? Gossiping neighbors?

    [Nosy neighbors. This was long before Zillow made this information ridiculously easy to look up. -Raymond]
  8. ipoverscsi says:

    @Joshua Ganes: Perhaps the fee is small because the person doing the buying has a mortgage (the bank is buying the property, not the person).  If buyer paid cash, maybe the language would be different.

  9. Alan says:

    I buying houses in different states is very different.  Some states (California and Illinois, if I recall) you need a lawyer, repeatedly, to draft offers and closing agreements.  In some (Wisconsin, I know), there are standardised forms with blanks that realtors fill in.  This is the first I've heard of "$10 and other stuff," but I find it plausible.

    I'm confident that the local government knows what your house actual sold for; they use sales to calibrate assessments for tax purposes.  It may even be online.

  10. Adam Rosenfield says:

    I had a friend who once took the van off of the hands of somebody else.  The van was in such terrible shape that it really wasn't worth anything, so the seller was just trying to get rid of it.  But when the title was transferred, it said that it was for the consideration of one dollar for whatever legal reason, though I don't think my friend ever paid that dollar.

  11. alegr1 says:

    @Adam:

    To be a sale (not a gift) the transaction should be an exchange of property for a "consideration" of value.

    This is similar to pro-bono lawyers "hired" for one dollar.

  12. Skyborne says:

    My county includes property owners and values as part of their GIS data, and they provide a browser-based map viewer subject to the look-but-don't-touch terms.  So even if Zillow folds, I'm good.

  13. No One says:

    Most cities and towns I've looked at have a link to or the name of the tax assessor for the municipality and those assessors usually have a website where you can look up properties to find the assessed value.  Of course, that's not necessarily the sale value.

  14. Bob says:

    In Texas the actual sale price of real estate is NOT recorded in the legal documents unless the buyer and seller agree. This leads to significant under-taxation of commercial and residential property. To make things worse, the property owner can take the county tax office to court if the property owner believes the tax valuation is too high. I recall a case where a company had won significant reduction in tax valuation in court for a property. About the year later the company went bankrupt and the property was sold as part of the Chapter 7 liquidation for multiples of the county tax office appraised value and many multiples of the court awarded value. This was prior to the huge run up of real estate prices in the mid-2000s. The appraisals of lower priced tract homes are pretty accurate because one can walk into the builders sales offices and get price lists.

    Zillow can only estimate the value of property in Texas and other non-disclosure states.

  15. Aaron says:

    Here's another annoying bit of legal convention that annoys me.

    Many contracts (including home buying contracts) often include phrases like: "the singular includes the plural, and plurals shall indicate a singular.  Terms referring to a male or a female shall include the other gender."

  16. Ivan says:

    I heard you could get a house in certain parts of Detroit for around that amount.

  17. cheong00 says:

    @Joshua Ganes: If you actually take a look at the deed they handed to you when buying the property, you can see that the stack of paper actually contains transaction records from the first date the property is built and sold.

    While you can search of current property transaction records on the web, you probably can't find out the price being sold 3 transactions before (Yup, I'm talking about those short turnover trades).

    For a record, in Hong Kong the actual value of transactions was written on these transaction notes, so I'm able to know my parents bought the flat with price almost doubles that the previous owner paid for. I guess not everyone is pleased to know about something like this.

  18. gogolkj says:

    @cheong00: there are ways to avoid to have the real purchase price being recorded. The latest trick used by buyers is to split the total purchase price into two parts, a purchase price and a 'relocation' fee; this is used to reduce the stamp duty required to pay on the property (the recorded price).

  19. Rick C says:

    @Aaron:  as annoying as that sounds, it serves a useful purpose:  foiling nitpickery.  With that boilerplate, you no longer have to worry about using standard legal terms like "The Party" or "The Parties" and worrying whether or not any given party consists of more than one person.  Also, it relieves you of the stupid need to balance your gender pronouns or use awkward constructs like "he or she."

  20. Simon says:

    @Rick C & Aaron:

    In the UK, we've solved that problem by just having a piece of legislation that says that for all contracts (and statutes), that boilerplate will apply by default (unless the context requires otherwise). Much more efficient than having to repeat it in every contract & statute.

    For statutes: http://www.legislation.gov.uk/…/enacted

    For contracts: http://www.legislation.gov.uk/…/61

    [Oh, great, now you have to look at the date on the contract to see what rules apply. -Raymond]
  21. ex-DonH says:

    Inflation is fierce.  When I bought my first house in 1989 I got it for only one dollar, plus consideration.

  22. Anonymous Coward says:

    Where I live people can get jail time for language like this.

  23. Anonymous Coward says:

    Oh, great, now you have to look at the date on the contract to see what rules apply. -Raymond

    It isn't the first change to contract law and it will hardly be the last, since law is like code. You may think you can write it and leave it, but it will always turn out to have bugs.

    And even if applicable contract law doesn't change, contracts cannot be in contradiction with other law, which also changes all the time.

    In practice this is not as big of an issue as you might think though since almost all contracts you'll have to deal with will be recent.

  24. Anonymous Coward says:

    In Florida you can compute the amount paid for the house from a <a href="dor.myflorida.com/…/doc_stamp.html">statutory documentary stamp fee</a> based on the amount paid for the house.  When the transfer is recorded in the official records book for the county, the amount of documentary stamp fee tax is recorded and stamped on the deed.  I wouldn't be surprised if other states had this.

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