Posted on: 21st Aug, 2007 07:37 pm
i'm looking to purchase a home from my parents that is completely paid for. they only desire to get back what they purchased it for, not what it is currently valued at. is there any benefit to them to transfer their interest through a quit claim deed, rather than do a normal purchase of the property? thanks!
Hi Castleman,
Welcome to the forum.
As the house is completely free of any lien, it will be better if you use the warranty deed to transfer the house from your parents. It Is a warranty deed, not a quitclaim deed which gives guarantee that the property is free of lien. To know more on warranty deed, you can refer to: http://www.mortgagefit.com/warranty-deed.html
Welcome to the forum.
As the house is completely free of any lien, it will be better if you use the warranty deed to transfer the house from your parents. It Is a warranty deed, not a quitclaim deed which gives guarantee that the property is free of lien. To know more on warranty deed, you can refer to: http://www.mortgagefit.com/warranty-deed.html
Hi Castleman,
In this situation, you have to decide it of your own on the basis of your current financial situation.
If you have enough amount of liquid money in your hand and you are looking to invest it some where then you can go for purchase and avoid taxes. It will help your parents to get money directly from you. It will be easy for them to accept.
If you are looking for property transfer, then you may need to pay tax as gift tax. And over here, you cannot help your parents by paying money. Yeah, one thing I agree with Larry, if property does not have lien and you are thinking for property transfer then go with warranty deed.
Thanks
In this situation, you have to decide it of your own on the basis of your current financial situation.
If you have enough amount of liquid money in your hand and you are looking to invest it some where then you can go for purchase and avoid taxes. It will help your parents to get money directly from you. It will be easy for them to accept.
If you are looking for property transfer, then you may need to pay tax as gift tax. And over here, you cannot help your parents by paying money. Yeah, one thing I agree with Larry, if property does not have lien and you are thinking for property transfer then go with warranty deed.
Thanks
Hi Castleman,
In order to transfer the property interest in your name from your parents, you can use the quitclaim deed. Your parents will have to sign the deed as the grantor and they will be giving up their ownership to you as the grantee.
In order to transfer the property interest in your name from your parents, you can use the quitclaim deed. Your parents will have to sign the deed as the grantor and they will be giving up their ownership to you as the grantee.
Is a quit clam deed the same as selling the property and aquiring sole ownership?
Hi Allison,
Though a quitclaim deed and selling a property is quite same as in both cases, the transfer of property is involved, yet there is a difference between them. In case of quitclaim, the property only gets transferred from the grantor to the grantee and no money related to the property value is transferred. The grantor may have to pay an applicable gift tax if he do not qualify for the exemption limit.
While by selling a property, the seller transfers his property to the buyer in lieu of money. So here the seller can earn a profit on the property. The seller may have to pay the applicable capital gains tax on the profit earned through the property sale incase he do not qualify for the exemption limit.
Though a quitclaim deed and selling a property is quite same as in both cases, the transfer of property is involved, yet there is a difference between them. In case of quitclaim, the property only gets transferred from the grantor to the grantee and no money related to the property value is transferred. The grantor may have to pay an applicable gift tax if he do not qualify for the exemption limit.
While by selling a property, the seller transfers his property to the buyer in lieu of money. So here the seller can earn a profit on the property. The seller may have to pay the applicable capital gains tax on the profit earned through the property sale incase he do not qualify for the exemption limit.