There are several ways to transfer the ownership of a property, each with its own advantages and disadvantages.
If you are planning or in the process of transferring the ownership of a property without a traditional sale, such as between family members, it’s best to use what’s called a quitclaim deed.
A quitclaim deed can also remove any title defects, known as clouds on title.
In this article, we’ll break down everything you need to know about a quitclaim deed to help you decide if it’s something for you to use when transfering the ownership of a property.
What is a Quitclaim Deed?
A quitclaim deed, also referred to as a “quick claim deed” is a fast and easy way to transfer real estate for non traditional sales.
For example, quitclaim deeds are often used to transfer property:
- between family members
- between married spouses
- between divorcing spouses
- in the event that a property is transferred into a trust
A quitclaim deed can also be used to remove any defects in the title without investing a lot of time and incurring legal expenses.
For a quitclaim deed, you do not need a lawyer to draw one up. In fact, you can easily find quitclaim deed templates online, which we’ll include later on in this article.
Next, we’ll look at the pros and cons of a quitclaim deed.
Advantages & Disadvantages of a Quitclaim Deed
Quick claim deeds can be used to cure a defect in the real estate transaction, often referred to as a “cloud on the title.”
This is a tremendous advantage.
For example, on the title, there may be an issue with the wording if it does not comply with current state standards.
Or, there may be a missing signature or a failure to record the real estate documents properly.
A quitclaim deed can be a solution in both of these scenarios.
Sometimes a title search reveals that the spouse of a previous grantor still holds an interest in the property if a past deed was not executed correctly.
By using a quitclaim deed, it signifies that the previous grantor is giving up any interest they may have in the property, resolving the cloud on title.
A quitclaim deed also comes with its fair share of disadvantages.
A major drawback of a quitclaim deed is that the grantee receives no guarantee about their ownership of the property.
In fact, the seller may only have partial ownership — or the grantor may not own the property at all.
This is why a quitclaim deed is most commonly used to transfer ownership from a family member, because the trust factor already exists.
Keep in mind that a quitclaim deed is generally not used in a situation where the property has an outstanding mortgage. Why? This is because it is difficult for owners to pay off the mortgage without the proceeds from selling the property. If a quitclaim deed is used on a property that does have a mortgage, ownership of the property is transferred but the mortgage remains in the name of the grantor — another disadvantage.
Next, we’ll explore the most commonly asked questions with a quitclaim deed.
Quitclaim Deed FAQ’s
Q. Quitclaim Deed vs Warranty Deed: What’s the Difference?
A quick claim deed is just one way to transfer ownership. Warranty deeds are another — and they have significant differences.
Simply put, general warranty deeds provide the highest level of protection for the buyer.
With a warranty deed, the seller claims that they actually own the property and are transferring it to the investor.
However, as explained in this article, there are some specific situations, like transferring ownership of a house to a family member, when quick claim deeds are extremely useful.
Q. How Long is a Quitclaim Deed Good For?
In many states, a quitclaim deed can be contested for two years after the deed’s filing date.
Q. Do You Need a Lawyer for a Quitclaim Deed?
While you do not need a lawyer for a quitclaim deed, using a lawyer provides additional protection.
Quit Claim Deed Form Templates
You can use a template to prepare your quitclaim deed. Here are a few links to online quitclaim deed forms:
In most cases, in order for county and city recorders to process a quitclaim deed, such as one found in the template section above, you need to include the following information:
- The name of the individual who prepares the form
- The address where to send the deed after filing
- The buyer's full name and mailing address
- The seller’s full name and mailing address
- The purchase price
A legal description of the property may be required.
You can often find that information at the County or City Recorder’s office.
You may also need witnesses as well.
The Bottom Line: Quitclaim Deed
While most property is transferred with a warranty deed, a quitclaim deed is a legal document that can transfer ownership quickly and correct defects, and in specific cases, carries many advantages.
Before deciding if a quitclaim deed is right for you, it’s important to examine a warranty deed.