Tags: Are you curious about the terms “quitclaim,” “grantor,” and “grantee”? These types of deeds and specific terms may come up if you’re transferring property between family members or spouses.
If you are selling your home now, you may not remember that you signed and received a deed when you purchased your property, such as a warranty deed or quitclaim deed.
The particular real estate deed provides proof of ownership for the buyer and transfers the title or deed to you, regardless of who the property owner (or co-owner) was before you.
2 types of deeds to transfer ownership of real property
The legal document that transfers ownership of the property can be a warranty deed or a quitclaim deed.
Warranty deed: Used in most real estate sales transactions, this deed says that the grantor (previous owner) is the owner of the property and has the right to transfer the property to you (the grantee). In addition, the deed serves as a statement that there are no liens against the property from a mortgage lender, the Internal Revenue Service, or any creditor, and that the property can’t be claimed by anyone else. Title insurance provides the financial backup to the warranty deed, and requires a title search to verify that no other claims, encumbrances, easements, or liens on the property are outstanding.
Quitclaim deed: Used when a real estate property transfers ownership without being sold. No money is involved in the transaction, no title search is done to verify ownership, and no title insurance is issued. A quitclaim deed real estate transaction sometimes occurs between family members.
When to use a quitclaim deed
Quitclaim deeds are most often used to transfer property between family members. Examples include when an owner gets married and wants to add a spouse’s name to the title or deed, or when the owners divorce and one spouse’s name is removed from the title or deed. In other cases, a quitclaim deed can be used when parents transfer property to their children or when siblings transfer property to each other.
Some families or parties opt to put their real property into a family trust, and a quitclaim deed can be used then as well.
Another time that a quitclaim deed might be used is when a title insurance company finds a potential additional owner of a real property and wants to make certain that this person doesn’t make a future claim of ownership.
In that case, the insurance company would ask that person to sign a quitclaim deed.
It is important to recognize that a quitclaim deed impacts only the ownership of the house and the name on the property deed or title, not the mortgage. For instance, in the case of a divorce, if both ex-spouses’ names are on the home mortgage loan, they are both still responsible for the mortgage payments, even if a quitclaim deed has been filed.
Quitclaim deed basics regarding grantors and grantees
The rules about how a quitclaim deed is handled vary by jurisdiction, but generally you need to include the legal description of the property being transferred, the date of the transfer, and the names of the “grantor” and “grantee.”
Not all states require you to record a quitclaim deed, but it’s wise to have the deed signed by the grantor and grantee and notarized in front of a notary public, then copied and recorded at the county recorder or county clerk’s office.
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Article From: "Michele Lerner" Read full article