For example, let’s say you owned a home before you got married and are still the sole owner. You can also use a quitclaim deed to reassure a lender that you aren’t interested in a property. They would be entitled to the proceeds from selling the home and be able to use it as collateral, but they would not have any legal responsibility to pay for it. Similarly, you might not want to add a spouse to your property title if they will not be on the mortgage. A safer move would likely involve refinancing the mortgage in the name of the person who will remain on the title, assuming that person can qualify on their own or with a new co-borrower. However, say you might not want to release your ownership interest in a property that you hold a mortgage on. Neither a quitclaim deed nor a divorce will absolve someone of their responsibility for paying a mortgage. Adding or Removing an Owner’s NameĪ common use for a quitclaim deed is to remove a spouse’s name from a property title after divorce or to add a spouse’s name after marriage. Someone might want to move real estate to a trust to avoid probate fees in states where probate can be expensive, especially for high-value real estate. You could also use a quitclaim deed to transfer property to a living trust. It’s smart to consult with a real estate attorney and a tax professional before taking action. ![]() Transferring your ownership on a mortgaged property could also trigger the lender’s due-on-sale clause. Transferring your ownership interest may have significant real estate tax, gift tax, capital gains tax or legal consequences. A brother might want to transfer his interest to his sister, or a parent might want to transfer a rental property to a child who will use it as a primary residence.īut just because you can transfer real estate using a quitclaim deed doesn’t mean you should. There are several situations where family members might want to transfer property to each other rather than selling it. While the grant deed doesn’t require the grantor to pay the grantee for any third-party claims that may arise, the buyer can purchase owner’s title insurance to protect against that risk. In California, real estate sales typically use a grant deed instead of a general warranty deed. In Massachusetts, for example, a quitclaim deed provides greater guarantees than it does in some other states and is commonly used in property sales, while a release deed is similar to other states’ quitclaim deeds. Neither the seller nor the seller’s lender would accept a quitclaim deed because it wouldn’t offer enough protection for the rights they’re trying to acquire.īut deeds work differently in every state. In many cases, you wouldn’t use a quitclaim deed to transfer ownership if you sold your home to a stranger. However, a quitclaim deed might not be the right choice. You may want to use a quitclaim deed if you’re transferring your interest in a property to someone who trusts you, such as your child. Promises that the grantor has the legal right to transfer ownership Promises there are no third-party claims against the property, such as mortgages or tax liens, and the grantor promises to pay any such claimsĭoes not promise the grantor has the legal right to transfer ownership or that the grantor even owns anything That said, a transfer among family members may require a different type of deed, like a special warranty deed, and there are also important variations among states.ĭoes not promise there are no third-party claims against the property, such as mortgages or tax liens A lack of warranty might be acceptable in a property transfer between people who know each other well and trust each other, but it wouldn’t be acceptable among strangers. ![]() The property transfers as is, with no warranties. The grantor releases, or “quits,” their interest in (claim to) the property. The transaction involves a grantor-a person who owns and transfers the property-and a grantee, a person who receives the transferred property.Ī common use for a quitclaim deed is to transfer real estate among relatives. How Quitclaim Deeds WorkĪ quitclaim deed is a method for legally transferring real estate without selling it. You’ll need to follow some technicalities to make the transaction valid, and you’ll also want to make sure a quitclaim deed is the right instrument to accomplish your goals. If you want to transfer your interest in a piece of real estate to someone you know, a quitclaim deed can be a fast and simple way to do it.
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