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Quitclaim Deeds

Transfers of property can be complicated and expensive. However, the law recognizes that not all property transfers are the same. For example, there are different concerns and needs when you purchase property from a stranger than when you transfer property among relatives.  Most real property transactions include the transfer of a general warranty deed that protects the buyer’s interests in the property by containing warranties that the seller has the legal authority to sell the land and that the land is free of certain encumbrances. However, general warranty deeds can be complex and expensive and they are not needed for every property transaction. 
When to Use a Quitclaim Deed
A quitclaim deed is given by a grantor, the person who currently owns the property, to a grantee, the person acquiring the property. A quitclaim deed simply transfers the rights of the grantor, if any, to the grantee. It does not make any warranties that the property is free of encumbrances or even that the grantor has lawful ownership of the property. Given this significant limitation, quitclaim deeds are not recommended for initial purchases of property or transfer of a property with which you are unfamiliar. 
However, quitclaim deeds are very useful in situations where you are certain of the property’s ownership and encumbrances because quitclaim deeds are generally less expensive and less time consuming to obtain than a traditional general warranty deed. Quitclaim deeds are appropriate in the following types of situations:
  • Divorce: if a divorcing couple is transferring property from joint ownership to single ownership or from one spouse to another then a quitclaim deed is likely to be appropriate.
  • Marriage after the purchase of property: similar to a divorce case, if property is owned by one spouse prior to a marriage and the couple wants to transfer ownership to joint ownership then a quitclaim deed is likely sufficient.
  • Gifts of property: if you are gifting property to a relative or friend then a quitclaim deed may be an inexpensive and practical method of transferring property ownership.
  • Transferring property to a trust or another legal entity owned by you: if you are transferring personal property into a business name or a trust then a quitclaim deed may be an appropriate method of property transfer since you already know the property encumbrances and other restrictions on ownership.
  • Resolving clouds on the title: a quitclaim deed may be used to resolve an individual property cloud on the title such as a misspelling on the previous deed or an improper recording of the previous deed.
What Needs to be Included in a Quitclaim Deed?
The requirements of what must be included in a quitclaim deed vary between jurisdictions but typically, at a minimum, a quitclaim deed must include: the names of the grantor and grantee, the legal description of the property, the consideration for the transfer (may be minimal such as $1 if it is a gift or to include a spouse, for example), the grantor’s signature and it must be witnessed by a notary public.
If you have any questions about whether a quitclaim deed is adequate to protect your legal interests in a piece of property or about drafting a quitclaim deed in your jurisdiction then it is important to contact a real estate attorney prior to making the transaction.

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