Misunderstanding in this forum about Quitclaim Deeds

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There appears to be a general misunderstanding in this forum about Quitclaim Deeds. It seems that most people think a Quitclaim Deed is the default, or best, method to transfer property. Actually, it is the worst.

I am a practicing attorney licensed in California and Texas with experience in real estate and collection matters.

Each state has different property laws. However, generally speaking, a Quitclaim Deed does not transfer an interest in property. All a Quitclaim Deed does is quit your claim to a property. That is, it renounces any interest you have, or may have, in a property in favor of another.

A Quitclaim Deed should only be used in certain circumstances. Usually, where you would want to renounce any potential interest in the title to a property. For instance, a spouse wants to let the other spouse have full title to a property, where the only interest the first spouse has is a community property interest that is not reflected on the title. Or, where an heir wants to disclaim any interest in a property to avoid having to answer in Probate Court.

Title companies disfavor Quitclaim Deeds because they break the chain of title so they must do further research to determine who is left with the title. More work, of course, means a higher price for your title insurance. Some title companies will refuse to issue a title policy where there is a Quitclaim Deed in the chain of title.

The better practice, one that actually transfers your interest in the property, is to use a Grant Deed. A Grant Deed grants your interest in a property to another.

The best practice is to use a Warranty Deed. A Warranty Deed is a type of Grant Deed that conatains a warranty that you have clear title to a property.

If you have any questions, consult with a real estate attorney in your area. A one-hour consultation will cost you less than you could lose in most real estate transactions.

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi Taylor,

Great info indeed! But I would like to ask you that you have said " a Quitclaim Deed does not transfer an interest in property". So say two people have 50/50 share of the property. So if one partner wants, can't he transfer his share of interest to the other partner?

Thanks,
Larry

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He can transfer his interest with a Grant Deed or Warranty Deed.

Although a Quitclaim Deed does not technically transfer an interest, it effectively does in certain situations. For instance, in your example, if he disclaims his interest using a Quitclaim Deed, then subtracting his 50% interest from the property leaves 100% interest in the other party, effectively transfering the interest.

Intra-family "transfers" of a portion of an interest in the same property is one use of a Quitclaim Deed, although it is the least desireable.

I guess it's a technical point, but I felt I must clear up some common misconceptions about using a Quitclaim Deed.

Caron · Posted: Tue Dec 11, 2007 11:03 pm Post subject: RE: quitclaim deed conception

Hi Taylor,

I understand and appreciate your concerns for giving out the right information. The community will be happy to receive such helpful details that will enable them to go the right way.

Well, the thing is, our community is open to suggestions and views of people from various spheres – be it the layman who's been going through some experience or the professional who can give an accurate detail or fact. So, may be that's the reason of such misconceptions. And, to get rid of such misconceptions, we are trying our best to provide people with the right information.

In this regard, our community of lenders and mortgage professionals along with professionals from the related industries are trying their level best to help people take the right decision.

However, I agree with you that grant deed and warranty deed are much better options when it comes to transferring interest in a property as compared to quitclaim deeds. Yet, a considerable number of people use it when it comes to intra-family transfers or conveying property-interest to friends or persons they know. I don't quite know the exact reason but I feel it's more easily accessible to them.

Good luck and we do appreciate your concerns. Smile

jameshogg · Posted: Wed Dec 12, 2007 12:24 am Post subject: RE:

Hi Taylor,

It feels good to know that legal professionals are also visiting this community. I mean who doesn't want to stay away from legal complexities? People like me who aren't aware of the laws, be it for property or mortgage are really scared of legal consequences.

In the industry you never know when you're in a mess…you take a financial decision, sign documents, go for some legal action; sometimes there's a problem with your property title, at times there's some other person claiming interest in your property, sometimes you're in mortgage problems and need attorney help. So, what do you do..and then you'll have to pay hefty fees (what I get to hear from people I know) if you want an attorney's service.

The best thing would be to have an attorney, who can guide you, advise you impartially on the right and wrong. That's the reason I feel, this community should have an attorney and Taylor, people like you who's so concerned about what information is passed on needs a around of applause.

People like you can make the community so confident when it comes to dealing with legal issues. So, why don't you too be a part of this community?

0.10 Dollars($)

having read many of the posts on this site, i have been continually alarmed, as have you, by the misinformation that is spread. some of it is so outrageously wrong as to be almost laughable.
i have attempted to right some of the wrongs i have seen and lend some semblance of normalcy to a topic or two; hitting them all is well-nigh impossible.
hooray for those who take the time to provide genuine assistance.

caron...i understand the desire to have lay people offer their experiences and understanding, but it is scary to think that a lot of their advice might actually be followed.

BrianDelaCruz

Hi Taylor,

I appreciate the good intentions with which you've commented above.

Through the forums, all we want to do is to pass on the right information to the community.

However, since there are common people participating, therefore at times there can be inaccurate details too. But, people do cross-check with the experts here. So, if you can join our community and be a part of it especially a part of the Quitclaim forums, then I feel the problem's solved.

Thanks,

Brian Dela Cruz

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