A deed, of course, is a legal document representing property ownership. But you might be wondering if an owner can transfer a deed to another person without a real estate lawyer. The answer is yes. Parties to a transaction are always free to prepare their own deeds. If you do so, be sure your deed measures up to your state’s legal regulations, to help avert any legal challenge to the deed later.
Some deeds require more expertise than others. A quitclaim deed, for example, is far simpler than a warranty deed. Let’s take a closer look.
Choose Your Deed
When residential properties are sold on the real estate market, buyers expect to receive general warranty deeds. The general warranty deed promises that no unmentioned lienholders exist who might have claims to the property; it means the owner is free to sell the home. Warranty deeds are used in “arm’s length” transactions — between people who don’t know each other apart from the real estate deal.
Further, the general warranty deed is an assurance that the seller will defend the buyer’s title against anyone else’s claim that might arise — even stemming from a time before the seller first took title to the home. So, before transferring a general warranty deed, the owner has to resolve all mortgages, tax liens, judgment liens and other relevant debts and encumbrances.
If you are transferring property under a general warranty or similar deed, it’s wise to seek professional assistance. A lot goes into the assurances of a cloud-free title. Various offices and insurance policies play their part. In complicated real estate deals, a title search is necessary, and title insurance serves to cover any undiscovered defects.
In contrast, some transfers are simpler and more conducive to a transfer without a lawyer or real estate agent. When transferring property to a family member or into a living trust, for example, or from a company’s owner to the business, a quitclaim can be quickly prepared and will get the job done. The quitclaim deed is also used to take clouds off a title. If someone could make a claim to the property, that person could sign a quitclaim to confirm they hold no competing claim.
When you use a quitclaim deed to transfer property, you make no guarantees. Under a quitclaim deed, you transfer whatever interest you hold (if you do, in fact, hold any at all) to the other person. You’re not promising clear title. You’re not agreeing to protect the recipient from defects in the title that might become problems in the future.
Wills, of course, are another way to transfer a deed, and a will can be written without a lawyer. A will is also a good way to pass a home on after death, to be sure an heir gets a stepped-up cost basis and receives a break on capital gains tax. But a will has no effect on deeds if their titles are vested in certain ways. Read on to review the ways an owner’s title can be vested.
Consider How Your Property Is Vested
While a deed evidences the transfer of property, a title states how the ownership is held. The title sets forth the capacity of an owner to offer an interest in the home as collateral for mortgages, and to transfer the whole interest, or a portion of their property interest, to someone else in the future.
Title can be held by a sole owner. When there are more than one, the co-owners may have various ways to vest the title:
- Joint tenants with rights of survivorship: These co-owners hold equal shares. When one owner passes away, the property interest goes to the surviving co-owner(s). No need for probate.
- Tenants in common: All owners hold their own percentage of ownership. Percentages can be 50-50, or unequal. Probate applies, as each owner can leave their part in a will.
- Tenants by entirety: In states that allow this type of vesting, spouses may be able to keep creditors from placing liens on property for one owner’s debt without the co-owner’s consent.
- Community property: In community property states, spouses own the home 50-50. Each may leave their part in a will. Some states offer community property with survivorship rights, which avoids probate.
A title may be in people’s names, or the name of a business. It might also be held by a trust, to be overseen for specific reasons and goals.
What Are the Steps to Transfer a Deed Yourself?
Quitclaim deeds are cost-effective tools for transferring interests in real property when there is no need for researched guarantees. Always consider potential tax implications before you decide to transfer real estate, including tax on the deed transfer itself. If you decide to proceed with your own transfer, here are the steps you’ll take.
Step 1. Retrieve your original deed.
If you’ve misplaced your original deed, get a certified copy from the recorder of deeds in the county where the property is located. You’ll need to know the full name on the deed, the year the home was last bought, and its address. Expect to pay a fee for a copy of the deed.
Step 2. Get the appropriate deed form.
Be sure to select the form that applies to the county and state where the property is located. View compliant deed forms here on Deeds.com.
Step 3. Draft the deed.
A valid deed must clearly identify the property. Use the utmost care when including the legal description of the property, which sets forth the boundaries, and can be found on the current deed. Be sure you’ve properly written your name as the grantor (party who is transferring the property) and the full legal name of the grantee (new owner). The name of the grantor on your new deed should match the name on the current deed. Identify the address and county of the home, the appraiser’s property folio number or parcel ID, and the transfer date.
The correct language, including words of conveyance, must appear: a statement from the grantor conveying the interest to the grantee, and the amount of consideration. The consideration is the value exchanged for the deed. If the grantee pays, the payment amount is included. It’s common practice is to state the consideration is $1 if you’re transferring but not selling the property.
Read, understand, and fill in form carefully, double-checking every completed field on the form. When in doubt about any detail, check your state’s law.
Step 4. Sign the deed before a notary.
As the grantor, you’ll need to sign the deed with a notary public, who will change a small fee. In some states the grantee may not need to sign, but the deed must be delivered to the grantee, and the grantee must accept the deed, or it’s not valid. (Yes, your intended recipient can refuse the deed.)
You can bring the unsigned deed to the recorder’s office if the county personnel offer notarization, and witnessing if it is required by your state. For an example, in Florida a grantor must sign the deed before a notary and two witnesses — who also sign in the notary’s presence. As you can see, a state and the counties will have specific requirements for the deed, which can include formatting, return addresses, the name of the deed preparer, and so forth.
Step 5. Record the deed with the county recorder.
The grantee (recipient) is well advised to record the deed in the county where the property is located. This involves obtaining a Preliminary Change of Ownership Report, a questionnaire for noting key details of the transaction.
Step 6. Obtain the new original deed.
As grantor, you keep a certified copy of the newly recorded deed. The new owner (grantee) should keep the original — and keep it in a safe spot!
What to Look Out For
If unsure about any facet of your decision, speak with an estate attorney, your financial expert, or both before proceeding with your transfer. There are good reasons to have someone with credentials in your corner when you transfer or receive any type of real estate deed. The risks in property transactions evolve, and they are situation-specific. Neither this website or any other should be considered case-specific legal advice.
A few further words to the wise:
- Don’t mess with Medicaid. Federal law and state provisions impose a waiting period after transferring a partial or full interest in the house before you can qualify for Medicaid benefits.
- Divorcing? Who’s paying the loan? If you use a quitclaim to leave your interest in the house with your ex, remember the lending institution. It still expects you to pay off any mortgage that you signed or that’s connected with community property. If you are divorcing with real estate assets, hire an attorney familiar with real estate law as well as family law.
- Don’t forget to call the insurance company. Quitclaiming your interest can impact the title insurance policy, so check in with the company when planning your transfer.
- Mind the mortgage! If there’s a mortgage on a home being sold, the seller will have to pay it off, or it needs to be assumable by the recipient. Transferring a home with a mortgage could trigger the due upon sale provision of the mortgage. Adding someone to the deed rather than conveying it outright could be a workaround, but be mindful of the drawbacks to sharing a title that you’d really prefer to convey. Another possible workaround is transferring the house into a trust. Be clear on what your mortgage company will allow that without accelerating the mortgage due date.
- And look out for quitclaims from strangers. If you receive a home by accepting a quitclaim deed, know that your title could have defects.
At Deeds.com, we take care to provide you with dependable deed forms. Our forms comply with each jurisdiction’s rules, and have the supplemental parts required by the state or county deed recording office. We monitor our forms to stay up-to-date, conforming with the current laws and rules.
Deeds are powerful. Use them knowledgeably. Be sure you feel sure of the rights and responsibilities you’re conveying, the right procedure to convey them, and the tax consequences (such as gift taxes and transfer taxes). Read more about the financial planning aspects of transferring a deed here, and alternatives to transferring a deed.
Photo credit: via Unsplash.