Conveying Real Estate Through a Power of Attorney

Image of a woman signing a legal document captioned: Power of Attorney for Real Estate

A power of attorney enables an agent (also called the attorney-in-fact) to conduct transactions on another person’s behalf.

The POA document often appears in the world of real estate transactions. A person (called the principal) might require a stand-in to sign financial documents, on account of absence or disability. A limited power of attorney can enable the agent to carry out any and all real estate transactions or even give an agent specific authority to sell one home (“for the sale of 123 Smith Avenue only”), and for a specified price. 

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You’ve Paid Off the Mortgage. What Happens Now?

image of money stacked next to a house captioned: You've paid off the mortgage. What happens now?

Congratulations! Paying off a mortgage is an impressive milestone.

Now that you have paid off all the debt on your property, your home state’s law will direct your lender to take certain actions. 

The lender will send you a certificate of satisfaction. This certificate, which the lender records in your home county, notifies the public that you have satisfied your obligation, and the lender has removed the lien from your property.

A few details of this process depend on what state your property is in, and whether your debt was secured through a deed of trust.

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Real Estate Transfer Taxes

Image showing person signed a deed with money on the table and a small house figure captioned: Real Estate Transfer Taxes

Most states and the District of Columbia impose a deed transfer tax when real property changes hands. This sales tax is based on the value of a given property. It applies to a transfer of full ownership from seller to buyer. It is also applied to any percentage of the property that is conveyed short of the entire property. Thus, if one co-owner relinquishes joint ownership in the entire property, the tax is calculated on half of the value.

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Refusing to Accept a Deed

image of an unsigned deed captioned refusing to accept the deed

For a valid real estate deed conveyance, two key actions must occur:

  • The giver (called the grantor) must deliver it the recipient (called the grantee).
  • The grantee must accept it.

A Recipient May Refuse to Accept a Deed.

Circumstances are not always right for taking on new ownership and new responsibilities. Moreover, not every piece of real property is desirable. Even with a significant estimated value, it might have hidden liabilities.

Thus, the gift of a deed can, and sometimes should, be turned down.   

This can get difficult if the grantor has the conveyance recorded with the county anyway, without the grantee’s knowledge. The grantee will then be obliged to file a court petition to void the conveyance.

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What Is a Quiet Title Action?

What is a Quiet Title Action?

A quiet title action is a special legal proceeding to determine rightful, legal property ownership. It is often a preventative or “friendly” lawsuit to ensure that no other parties have conflicting claims to a title, or to resolve an ambiguity. Depending on state law provisions, the plaintiff—that is, the party filing the complaint—may be the mortgage lender, a potential buyer, the legal title holder, or someone in actual possession of the property.

Prevailing in a quiet title action enables the rightful owner to get title insurance, to take a loan out on the property, and to convey the property free and clear of any cloud on the title.

When to File a Quiet Title Action

Whenever doubt or ambiguity arises as to ownership in a title search, the title company will not issue a title insurance policy. This means the property lacks marketable title. To obtain a mortgage loan, title insurance is necessary.

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