Real Estate Title And The Quit Claim Deed

Deeds are simply documents that transfer title from one person to another. There are many different types of deed, but basically they just transfer title.

Let's talk about a "quit claim deed".

A quit claim deed is a type of deed where a person (grantor) with an ownership interest in a property transfers that interest to another person (grantee). The grantor offers no guarantees about the title to the grantee recipient. Don't confuse a quit claim deed with the type of deed that is normally used to transfer title to real estate. That is most often a grant deed or a warranty deed. Those deeds transfer title with some guarantee that the title is legal and valid.

You sometimes hear a quite claim deed erroneously called a "quick claim deed".

A quit claim transfers only the rights of the person signing the deed. It does not guarantee that other people don't have an interest in the property. If there are other owners, their ownership is not affected by the quit claim.

You will find that a quit claim deed is most often used to clear up problems with a title or when someone wants to use a simple method to give up all interests in a property. Quitclaim deeds are sometimes used by a divorcing couple, where one spouse signs all his/her rights to their home over to the other.

It is not uncommon that when a property is being sold a title search finds that a mistake has been made in the past and a previous owner never relinquished his ownership in the property. That puts a "cloud" or "defect" on the title. The problem is solved by contacting the previous owner and asking him/her to sign a quit claim deed.

The title company is usually the one who makes the call when a quit claim deed is needed from a prior owner. Most transfers of property involve mortgage loans. When there is a cloud on title the quick claim dded is necessary to insure the lender of a first lien position if the borrower does not make payments according to the note. The lender cannot enforce a trustee sale (non-judicial foreclosure) against someone whose name is not on the note, the that name is on title.

If that person will not sign the quick claim deed to release their interest in the property the sale probably will not close. At the very least the close will be delayed while other actions are taken to complete the sale.