[MRM]

Without getting a lot more details from you, the best you can get is general advice. In general, the plan you have would result in an agreement that would be worth almost the paper it was printed on.

The deal is that if you don't record your interest you have almost no rights as to that piece of property. Anyone who obtained an interest in the property, such as mortgages or mechanics liens or judgment liens, and recorded the lien would take priority over you, even if their interest came after you, because they recorded their interest and you didn't. They could forclose on the property, take all the value of their interest in it, and you might be left with nothing.

If you're going to secure the debt with property record the lien. Spend the $500 on a lawyer to do it right. If you're not interested in having a public record of the debt, just take an unsecured note. Of course, that's pretty much what you have now. Can you take title to his car or something?