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Can I Transfer Property Ownership With A Quitclaim Deed?

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If you wish to legally transfer ownership of your home to another individual, it might be possible to do so relatively quickly and simply through a quitclaim deed. However, it's important to be aware of the fact that this method for transferring ownership might not effectively transfer the financial burden of owning the property in all situations.

Consider the following information, and be sure to consult a lawyer at a reputable law office like Valentine & Valentine PC, before opting for a quitclaim deed to transfer property ownership:

What is a quitclaim deed?

The quitclaim deed transfers ownership between a grantor and a grantee without involving a title covenant or a warranty regarding the property's title. When used appropriately, a quitclaim deed can give the grantee the benefits of owning the property without the financial drawbacks that often result from property ownership. 

When should a quitclaim deed be used to transfer ownership?

Generally speaking, a quitclaim deed should only be used to transfer ownership between friends or family members. It is a more simple and informal way of transferring ownership than a traditional title transfer.

However, there are some limitations of the quitclaim deed that make it inappropriate for transferring ownership between unfamiliar parties. 

Quitclaim limitations: How mortgage liens affect the transfer of rights and interests

Those who attempt to transfer property ownership through a quitclaim deed will have to deal with some cumbersome complications if there is still a mortgage lien on their property.

The quitclaim deed can only transfer the rights and interests that the homeowner has in the property. If the homeowner is still paying off a mortgage on the property, then the mortgage lender still has an interest in the property. In this case, the homeowner can only transfer his or her equity in the home. 

A quitclaim deed cannot confer responsibility to cover mortgage payments onto the grantee. Of course, the mortgage lender will still be expecting to receive the outstanding balance on the mortgage loan from the original borrower even if a quitclaim deed transfers ownership.

Homeowners who are still paying off their mortgage loans therefore must retain an interest in their home to continue making payments towards their mortgages. However, they can come to a private agreement with a quitclaim grantee regarding responsibility for mortgage payments. 

Using a quitclaim deed

A quitclaim deed is probably not a very effective tool for transferring homeownership when a mortgage lien still exists on the property in question.

Most homeowners wishing to transfer ownership are looking to do so in order to decrease their own financial burdens. Generally, a quitclaim deed will not legally free homeowners of their financial obligations toward the property. Nevertheless, it may be possible to discuss the situation with the mortgage lender and have the lender endorse the ownership transfer.