Lori Ballen, the owner of this website, benefits from purchases made through her affiliate links.
You finally find an ideal home for your family, but the owner wants you to accept a quitclaim deed to transfer property ownership. Do you go for it? Probably not. Here are three facts every real estate buyer and seller must know about quitclaim deeds.
3. Quitclaim Deeds Offer No Protection
A deed to a given property is a legal document that proves the property’s title transferred from one party to another party.
Some deeds offer additional security to buyers apart from transferring the title.
For example, warranty deeds and special warranty deeds offer buyers protection in cases where there are issues with earlier titles or other claims on the property.
Quitclaim deeds offer no protection to buyers.
A quitclaim deed only shows that the person transferring the property (called the grantor) is giving their interest in the property to the person accepting the property (called the grantee). The quitclaim deed makes no guarantees that the grantor owns the property outright.
If you accept a quitclaim deed as proof that you own a piece of real estate, you may run into future issues with that real estate.
Some of the undisclosed problems you may encounter after accepting a quitclaim deed include the following:
• Unpaid past property taxes on the real estate
• Second mortgage loans on the property
• Contractor, creditor, or judgment liens (debts) against the property
• Liens from the Internal Revenue Service
• Improper transfer of portions of land connected to the property
When a house, mobile home, or piece of land is owned by a married couple or two family members, both owners must sign the quitclaim deed in front of a notary public.
If only one spouse or family member signs a quitclaim deed, the non-signing spouse or family member can later claim their share of the property, you purchased.
In that case, you don’t actually own clear title to the property described in the quitclaim deed.
2. Quitclaim Deeds Work in Low-Risk Situations
Quitclaim deeds are legal documents that work well for their intended purposes.
In low-risk real estate transactions, the quitclaim deed allows grantors and grantees a fast, easy method to transfer ownership of real properties.
Low-risk real estate transactions are those where both the grantor and grantee trust each other and are aware of the ownership history of the transferred property.
Examples of situations where quitclaim deeds may be appropriate include the following:
• Adding a spouse to a deed after marriage
• Removing a spouse from a deed after divorce
• Transferring ownership to qualify for a mortgage
• Transferring title to a child or relative
• Giving real estate as a gift or donation
Quitclaim deeds are also used when creating life trusts for seniors. With a quitclaim deed attached to a life trust, a senior grantor can continue to live on a property and control it until their death.
The title to the property passes to the quitclaim deed’s grantee upon the senior grantor’s death. Heirs can receive property quickly after the grantor’s passing and avoid probate court when settling estate issues related to the property.
If a senior transfers real estate using a quitclaim deed without creating a life trust, there are no guarantees that the senior won’t get kicked off of the grantee’s property in the future.
Additionally, improperly signing away real estate via a quitclaim deed can harm your eligibility to receive public assistance (for example, Medicaid or Supplemental Security Income). Signing away property with a quitclaim deed can also affect your tax status and liability.
3. Quitclaim Deeds Help Correct Defects
If there are errors in a previous warranty deed or other real estate deed, a quitclaim deed is one way to correct those defects easily. Some of the deed issues a quitclaim deed may correct include the following:
• Wrong spelling of names or other data
• Incorrect legal description of the property
• Improper notary process when the deed was signed
• Incorrect ownership dates or transfer dates on deeds
Each state in the U.S. has its own rules regarding the use of quitclaim deeds for transferring property and correcting defects in older deeds.
After a quitclaim deed is signed and notarized, the deed should be filed with the proper registrar in the state where the property is located.
Once filed, the quitclaim deed becomes part of the record of ownership of the property described in the deed.
Before you sign a quitclaim deed to transfer your property or accept property from another person via a quitclaim deed, consult with a real estate professional to learn more about the risks and explore your other legal options. A real estate attorney, broker, or agent can help guide you to the best solutions for your particular real estate situation.
- 43 Things You Didn’t Know About Las Vegas Pools, Splash Pads, Waterparks, and Water Features
Las Vegas is known for its vibrant nightlife, world-class casinos, and luxurious resorts. But did you know that Las Vegas is also home to some of the most spectacular pools, splash pads, waterparks, and water features in the world? This blog post will explore things you didn’t know about Las Vegas’ aquatic wonders. - Caesars Palace Pool: The Garden of the Gods Pool OasisIf you’re looking for a luxurious pool experience in Las Vegas, the Garden of the Gods Pool Oasis, Caesars Palace Pool (or 7 pools that is) is the perfect destination
- 50 Things You Didn’t Know About Buying a House in Las VegasLooking to buy a house in Las Vegas? Don’t miss these 50 important considerations beyond the usual real estate factors, compiled by top-performing real estate team, The Ballen Group, led by expert Lori Ballen. From HOA regulations to home security cameras, this comprehensive guide will help you make informed decisions about your new home purchase.
- Nevada State Income Tax: – A Financial Haven for HomeownersDiscover the financial benefits of owning a home in Nevada, which offers no Nevada state income tax, and explore the Las Vegas real estate market. Compare tax-friendly states, cost of living, and more. Learn how Nevada’s sales tax affects you.
- Take a Hike: The Best Red Rock Canyon Hiking TrailsLori Ballen, the owner of this website, benefits from purchases made through her affiliate links.Red Rock Canyon is like no other – an amazing blend of geology, wildlife viewing opportunities, and incredible hiking trails just waiting to be explored by all levels of hikers alike! Whether you’re looking for a leisurely stroll or a challenging […]
- 10 Best Ramen in Las VegasIf you’re looking to find the best ramen in Las Vegas, we’ve got you covered.
