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Niicss · Posted: Tue Sep 04, 2007 4:08 pm Post subject:

Hi Elssy,

Quit claim deed only transfer property interest. It cannot stop lender from foreclosing. The house is the collateral for the mortgage and in case of default he has the right to foreclose and sell the house to recover his dues.

If you are facing problems with the payments then inform the lender about it first. It is possible that lender would agree to receive payments for two months together when you regain financial stability. Another thing is that lenders do not normally select to foreclose if the borrower is in default for just one month, they generally wait for 3 months before considering foreclosure as an option.

Guest

Thanks for taking the time and effort in creating this content to share your knowledge with all of us.

Guest

I have a house that I want to Quit Claim to my son.
I assume the mortgage compant will still retain the mortgage in my name and I am responsible for it until the house is refinanced by my son?

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Yes John,

Even if you quitclaim the house to your son, it will not remove you off the loan. It will simply transfer the ownership of the property in in your son's name. The mortgage will still remain in your name until your son refinances it.

So, it is better, if your son refinances at the time of transferring the property only. Otherwise, if you quitclaim him the house earlier, he may not be willing to refinance after getting over the title. In that case, you will have to continue with the payments.

Guest

What are tax implications and Mortgage responsibilities of a quit claim deed in the following instance? My father has had major financial difficulty throughout his life (terrible credit, only SS income, no retirement). 10 years ago I helped he & his wife out by buying a house and securing the mortgage and title in my name alone. I knew I could always end up selling the property if they weren't able to make payments as my security and could use the mortgage interest deduction on my returns. The deal was within 2 years he would be able to payoff the entire mortgage (by selling off some business interests) and I would transfer the house to them. Well 10 years later that hasn't happened and I've even had to dig into my savings to help w/payments periodically. Fortunately the property has gone up in value and has lots of equity. He is trying to have me sign a quit claim deed, but I've explained to him that there will be tax implications and how is he going to find a mortgage company that will allow him to finance as the quit claim deed would leave the financial responsibility and mortgage in my name as my debt. He refuses to move and realize capital gains. Any suggestions? I'd want to know my full implications regarding capital gains taxes, make sure my name is removed on all debt, and receive money owed to me before I'd ever sign the property over. If he is able to secure a loan (how can I make sure that this is done before I quit claim?), this will be my only opportunity to receive $ from him for any tax implications (I bought property for $100k and its worth about $250k now). I'd really like to be relieved of this issue, but I'm afraid he can't qualify for a loan and he forgets I did this to help and not try to steal from him. Will I have to forgo some of my $1mil tax exemtion for the increased value of $150k? Are there any other taxing items I have to be concerned with? Since this is a 2nd house, how iwll this affect any future property purchases for me?

sara · Posted: Mon Sep 24, 2007 3:29 am Post subject: RE: mortgage and quitclaim

Hi Jeff,

Welcome to the forums.

Does your father want you to sign quitclaim deed and transfer the property to him? If that is so, then he needs to find out a lender who can provide him with the finances so that he can refinance the property in his name. But as you say, he isn't getting a lender. But has he shopped around well? It takes some time before you can actually find out the lender who can suit your needs.

Since the loan is in your name, you need to make the payments or else you may be in default. The only solution as I can think of here is you sell off the property to pay the loan in full. And, if your father isn't willing to sell, then you can go for a partition lawsuit to initiate a forced sale of the home. But for that, you need to take help from a real estate attorney.

Take Care

Guest

He was able to secure a loan, but how I can I sure he actually follows through once I quit claim the property to him? I also don't want to be stuck w/any tax liability. If I originally purchased the property for $105k and its now worth approx. $240k will I be responsible for taxes on difference in a quit claim transfer? How much would my tax liability be for? I want to be sure he covers my liabilities before I will complete the transaction/transfer. Thank you!

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Hi Jeff,

As per federal laws, if the value of the transferred property through a quitclaim exceeds $12,000, then the grantor has to pay the applicable gift tax provided he does not qualify for the lifetime gift tax exemption limit. To know more on gift tax applicable with quitclaim deed, you may refer to http://www.mortgagefit.com/gift.html

Guest

My mother set up a quitclaim deed to transfer her home to me after her death. She recently passed away, and I've been to the registar of deeds and had the title put in my name. Will there be an inheritance tax, any restrictions on selling it (ie, someone told me I'd have to live in the house for 2 years before I could sell), etc?

Thank you

Caron · Posted: Tue Oct 02, 2007 11:40 pm Post subject: RE: inheritance tax

Hi Lois,

Welcome to our forums.

Since you are the heir to your mother's property, therefore you will have to pay the inheritance tax. It's a tax collected by the state government from an individual who gets the right to assume ownership of a property of a deceased person.

The property inherited is evaluated and depending upon the value and the heir's relationship with the deceased person, the inheritance tax may have to be paid.

Regarding occupying the property for 2 years before you sell, I believe the person who suggested this, meant that you can get capital gains tax exemption when you sell the property. And, this is possible only if you stay in the property for 2 years out of 5 years prior to the sale.

Good luck Smile

Guest

my grandmother quick deed her house to me. She is not in the best of health. If she passes away will the deed stand up in court or will I have to move out and let her children sell the property? What rights do I have?

jenkin7 · Posted: Sat Oct 13, 2007 5:38 am Post subject:

Hello Lynne,

If the quit claim is recorded at the county clerk's office, then according to that you are the owner of the property and you have all rights to it.

Caron

Hi Lynne,

Welcome to our forums.

I hope your mother recovers soon and regains good health.

If she has signed the quitclaim at her own will and conveyed her interest in property to you, I don't find any reason as to why you need to move out. And, if you are the only one who has been given the ownership rights, then there's need to worry. But I want to ask a question - does she have a Will?

Guest

Yes she does have a will. but it was also mentioned that if she ends up in a nursing home they can take the house to pay for her bills, like up to 5yrs? Is this true, I am confused?

helping_user · Posted: Sun Oct 21, 2007 4:51 am Post subject: RE:

Lynne,

If your grandmother has earlier applied for a Medicaid, then her house may be taken away and sold as a part of the estate recovery process. Through this process, the Medicaid offering body tries to retrieve what they have paid for her bills. But they might have given you some time so that you can pay for the bills, isn't it?

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Tax implications of Quit claim deed