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Quitclaim Deed: A Document that transfers property-interest

Posted on: 05th Jun, 2005 10:42 pm
A quitclaim deed is a legal document that transfers your interest to another individual in the property such as
  • House - A building for human habitation
  • Land - A place which can be used for habitation, investment or any other purpose
  • Mobile home - A movable house that is parked in a place
Two parties are there in a quitclaim deed process – grantor and grantee. Grantor is the party that transfers the property and the grantee is the party that gets the property. In a quitclaim deed, no promises are made by the grantor that the property is lien-free. Before opting for this deed, it is advised that the grantor should consult an attorney and know about the possible consequences of such property transfer.

To help you get a clear idea of what a quitclaim deed (often misspelled as quick claim deeds or quit claim deeds) is, the whole information is divided into different sections:

When to use quitclaim deed

A quitclaim deed is commonly used in the following situations:

  1. In a divorce, when an ex-spouse transfers ownership of the property to the other.
  2. A spouse may add other spouse's name to the property title after marriage only by issuing the spouse a deed.
  3. At the time of purchasing a property, ownership is transferred from the seller to the buyer. For such transfer, parties involved may use a quitclaim, general warranty, or special warranty deed.
  4. Sometimes, previous owner of the property may retain some ownership interest in the property. This interest can be transferred to the new owner with the help of a quitclaim deed.
  5. A person planning a will or a living trust can use the document to transfer ownership of the property into a trust or the person they want to inherit the property.
  6. Parents willing to transfer the ownership in a property to a child or a relative before the property gets stuck in a probate.

6 Steps to follow in a quit claim deed

Preparing a quitclaim deed is very easy. Here are some quick steps to do so.

  1. First of all, obtain a quit claim deed form. You can get the form online. You can also obtain it from the office of the local county recorder.
  2. Fill in the names of the grantor and the grantee. If possible address of both the parties has to be filled in.
  3. Signature of the grantor should be there in the form. In some states, signatures of both the grantor and the grantee are required.
  4. A public notary should verify the signature of the grantor. Generally, the grantor has to sign the deed in front of a public notary.
  5. A legal description of the property is a must. This is because of the fact that without the legal description, deed can’t be recorded in the recorder’s office.
  6. In order to make the deed valid, it should be recorded in the recorder’s office.

Life estates and quitclaim deeds

Even after transferring a property through quitclaim, you can have the right to stay there till your death. This is possible only if you retain a life estate for yourself. A life estate is a kind of estate where you retain interest in the property for your lifetime, and specifically name the person to whom the property is to go to immediately after your death.

Reverse/undo quitclaim

Once you have signed a quitclaim, the only way to get the property back is to have the grantee quitclaim it back to you or prove the transfer was invalid. If you can prove that you signed the deed under threat, external pressure, or the grantee made you sign by telling you false information, then you can have the quitclaim deed invalidated. For invalidating a deed, consult an attorney in your state. Learn more...

This legal document is a good way to transfer property if you are transferring it between family. The best way to transfer property to or from someone who is not family is to use a general or special warranty deed which gives the buyer warranties as well as transfers property.

Related Readings

Related Forum Discussions

Hi, can u pls advice. My mom is thinking of looking into a quick claim deed for her property. I have 2 children and I wonder if she proceeds with it, shall I and my children have to pay for the annual property taxes?
Posted on: 22nd Oct, 2005 12:02 pm
Hi Elisa
Welcome to MortgageFit forum.

Through a quitclaim deed your mother can sign over the ownership and financial interest she holds in the property to whoever is named on the deed.

In case you and your children receive the property through the deed, then as long as the deed is prepared correctly and filed, you and your children will be financially responsible for the property. This implies that you will have to pay the annual property tax and may be also the mortgage payment, homeowner's insurance premium and maintenance costs of the property.

Hope this will guide you.

Regards,
Jessica.
Posted on: 22nd Oct, 2005 12:37 pm
my husband and I have decided to buy a home for our son to stay there. He will be making the monthly payment. now that we don't want to use this home for any tax gains, can we sign a quit claim property deed over to him so that we don't have to pay taxes on the home when he chooses to sell it? I know our son cannot get a loan on his own but we don't want to co-sign and still be responsible for the payments? Also, can anyone help me with a free quit claim deed form?
Posted on: 23rd Oct, 2005 12:02 am
Hi,

If you ask me about signing the deed, my suggestion would be big NO.

Your son doesn't have sufficient funds or credit to carry out the purchase independently. You bought the property in your name and if you sign the quit claim deed then the title is getting changed and lender will demand the repayment of loan immediately as the lender gave the loan to you not to your son. The reason behind the lender asking for the full repayment is that the loan was given to you, not your son and you have the better credit not your son.

But if you pay off your mortgage and then sign the property to your son with quit claim deed then it is taxable. You have to pay the tax in this regard.

I would suggest you to pay off your mortgage and then sell your property to your son at a fair market price and take back financing. You can also gift this property to your son and forgive some amount a year in debt. This will allow your son to hold the property free and absolutely clear. This will avoid gift and estate tax problems. Kindly consult a income tax quit claim deed professional for further assistance on tax issues.

If you can't pay off the loan, then try to work with your son each month to assure that all bills are fully paid in a timely manner. This will improve his credit status so that in the future he will qualify to finance the property on his own.

If you want to get a quit claim deed form free of cost, you can check out the given page: http://www.mortgagefit.com/predeal/quitclaim-stateforms.html . You will find a number of sample deed forms here. While you use them, make sure you contact an attorney in order to check out if the deed form suits your purpose.

Niicss

[Edited by Jessica, made minor changes. Thanks.]
Posted on: 23rd Oct, 2005 02:00 am
Hi Niicss,

I do agree with your reply. Great advice!!

Thanks,
Jessica.
Posted on: 23rd Oct, 2005 03:13 am
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