If you are transferring property, it needs to be done legally. You cannot just say “here you go daughter, have my property” for example. It has to legally change hands. Even if no money is exchanging hands as would occur during the sale of the property, certain legal documents must be executed in order for the process to be legal. The document you must execute is called the quitclaim deed.
What is a Quitclaim Deed?
A quitclaim deed is a deed as the name suggests, but it does not take as long to process this deed as it would if you were selling the property. In this case, the property is simply being transferred and is documented on the quitclaim document. In this case, there are no title search fees as nothing needs to be evaluated and there is also no need for title insurance.
Common Uses for a Quitclaim Deed
The most common uses for a quitclaim deed are when someone gets married as well as when a couple gets divorced.
In the case of two people getting married, sometimes one partner already owns a home or the couple purchases a home after they are engaged, but the deed is only in one partner’s name. Once the marriage is legally official, the other partner can be placed on the deed. This helps to offset any issues down the road should the marriage not occur.
In the case of a divorce, the opposite usually occurs. If both partners are on the deed, one can be quitclaimed off of the deed as a result of the divorce. This simply removes the owner’s name from the title, which removes his rights as an owner; however, this person is still legally liable for the debt unless the other partner refinances on his own.
Other less common occurrences for a quitclaim deed include parents transferring property to their children or other family members giving their property to others.
Last, but not least, this document could be used by the title insurance company if they were to come across a previous owner that erroneously still held title to the property. The insurance company would have to ask that person to take themselves off of the deed by executing the quitclaim document.
How the Quitclaim Works
The quitclaim does not require nearly as much work as the original deed required. You do not have to prove that you are qualified for the deed in any way because you are not dealing with the loan itself, but rather ownership rights to the property.
Typically, an attorney draws up the documents for you. This is the best way to do it to ensure that everyone’s rights are protected. Of course, just like most other things, you can purchase quit claim deeds online, but then you risk not executing it the right way. When you pay an attorney the small fee they charge for this document, you can make sure everything is done correctly.
On the deed, the attorney or yourself will need to provide the exact legal description of the property as well as the names of the grantor (person granting the property to someone else) and the grantee (the person receiving the property).
Once every detail is included on the deed, everyone that is involved in the transaction must sign and date it. This should be done with a notary public so that there is an official witness to the document. The notary will then sign and stamp the document to make it official. Depending on where you live, you might also have to secure the signatures of two unbiased witnesses that also sign the document in front of the notary public.
The final step is to record the deed with the county. This makes it public record that the ownership of the property changed hands. There is typically a recording fee, but it is rather small and is worth the expense to ensure that the deed is properly recorded with the county to prevent any future issues.
The quitclaim deed process is rather simple and does not require a lot of money. It is best to use an attorney and to officially record the document with the county, which is where the fees come into play. In the end, everyone’s rights are protected and the deed is properly executed to ensure that the proper owners are the owners of record.