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Bill Summary · HB 235

Summary — HB 235 (Fraudulent Deeds) — North Carolina (2025)

Status: Passed 1st Reading (Feb. 27, 2025)
Filed: Feb. 26, 2025 (sponsor: Rep. Torbett)
Subject areas: deeds; recordation; forgery; real property; public records; registers of deeds; courts; crimes; tax certification

Purpose / Intent

HB 235 is intended to (1) strengthen criminal penalties for filing or presenting materially false or fraudulent deeds/conveyances for recording; (2) create a fast civil process for a true owner to obtain emergency court relief and remove or mark fraudulent recordings; and (3) authorize county-level tax-certification checks before certain deeds are accepted for recording to help prevent fraudulent transfers and ensure taxes/lien issues are addressed at closing.

Key provisions

  1. Amend G.S. 14-122 (forgery / presentation for filing)

    • It becomes unlawful to present for filing/recording a deed or transfer of real property if the presenter knows or has reason to know the deed is false or contains a materially false/fictitious statement.
    • Criminal penalties tied to property value:
      • Property value ≥ $100,000: Class C felony.
      • Property value < $100,000: Class G felony.
    • (Existing forgery provisions remain; Class H felonies continue to apply to certain forgery acts.)

  2. New civil remedy — G.S. 14‑118.6A (Fraudulent deed or conveyance)

    • The actual owner may file a civil action in district court and may proceed pro se.
    • Emergency ex parte process:
      • Upon sworn statement and evidence, the court may issue a temporary order declaring the recording fraudulent if there is no statutory/contractual/legal basis for it.
      • Temporary order duration: the later of 60 days or until a permanent order is entered.
      • Clerks must schedule an ex parte hearing quickly (within 72 hours or by next session day); chief district court judge may authorize magistrates to hear such motions.
      • A full hearing must be held within 10 calendar days from issuance of the ex parte order (or 7 days after service), and continuances are limited.
    • Remedies court may grant: return of possession / ejectment, attorneys’ fees and costs, stays of other proceedings involving the property.
    • If a court issues a permanent order that a recorded instrument is false and void, the order must be recorded with the register of deeds.

  3. Duties of registers of deeds

    • Upon receiving a duly issued ex parte or permanent court order, the register shall record and cross-index the order and conspicuously mark the first page of the original recorded document with the statement: "THE CLAIM ASSERTED IN THIS DOCUMENT IS FALSE AND IS NOT PROVIDED FOR BY THE GENERAL LAWS OF THIS STATE."
    • No recording fee shall be charged for recording the court order.

  4. Additional statutory consequences

    • Presentation for recording of an instrument later determined to be materially false/fraudulent is also a violation of G.S. 75‑1.1 (unfair/deceptive acts).
    • A person who brings an action under the new civil provision knowing the deed/conveyance is not false commits a Class G felony.

  5. Tax certification before recording — amendments to G.S. 161‑31

    • County commissioners may (by resolution) require that the register of deeds not accept any deed for registration unless the county tax collector certifies that no delinquent county/municipal or other applicable taxes are liens on the property.
    • Exception: the register must accept deeds executed under the supervision of a closing attorney that include a statement that the instrument was prepared by a licensed NC attorney and that delinquent taxes, if any, will be paid by the closing attorney from closing proceeds.

Who is affected

  • Property owners and victims of recording fraud — gains a fast, low-barrier civil path to clear title.
  • Registers of deeds — new recordation duties and required conspicuous markings; process for recording court orders without fee.
  • Courts (district court division) — added caseload and expedited hearing requirements (ex parte/priority hearings).
  • Closing attorneys, title companies, and real-estate closers — tax-certification regimes and the closing-attorney exception will affect closing workflows and responsibilities.
  • County tax offices — potential increase in certification requests.
  • Persons who knowingly file fraudulent instruments — face felony charges (Class G or C depending on value) and civil consequences under G.S. 75‑1.1.

Procedural / timeline highlights in the bill

  • Emergency (ex parte) relief timeline is expedited:
    • Clerk must schedule ex parte hearing within 72 hours (or by next session day); hearing on the merits must follow within 10 days (or within 7 days after service), with limited continuances.
  • Temporary orders last the later of 60 days or until permanent order entry, giving courts time to adjudicate title disputes quickly.

Potential impacts and considerations

  • Intended to reduce title fraud and give victims an efficient remedy to clear records, but will increase workload for district courts and registers of deeds.
  • May accelerate remedial action (ejectments, stays, fee awards) in fraud cases and reduce harms to innocent purchasers if fraud is caught quickly.
  • The criminalization provision raises enforcement considerations (investigation, prosecution priorities) and could increase prosecutions for deed-related fraud.
  • The tax-certification requirement may delay recordings when counties opt in, but the closing-attorney exception aims to preserve standard real-estate closings while imposing responsibility on closing attorneys to ensure taxes are paid.

Where to watch

  • Committee assignments and next steps (e.g., Judiciary 2 referral) and any amendments or fiscal analyses from state agencies (court workload, county costs) as the bill proceeds through the Legislature.

Compiled from official sources — confirm details with the bill’s official record.

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