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Transferring Property

The legal term for transferring real property or property title to a new owner is conveyance.

A real estate attorney can help the conveyance by taking the wishes of the buyer and the seller and translating them into a legal document called a deed. The attorney will determine:

  • What type of deed is needed for this transfer of property?
  • Who must sign the deed form?
  • How will the new owners hold title?
  • What interests and ownership rights in the real estate property are being conveyed?

The attorney will then draft the proper legal document and record the new deed (or similar real estate document) with the correct state agency.

What Are Deeds?

A property deed is a legal document that establishes ownership of a property. The deed usually:

  • Identifies the buyer (grantee) and the seller (grantor)
  • Identifies the purchase price
  • Provides a legal description of the property
  • Is signed by the person transferring the property (notary public must notarize the seller's signature)

Types of Deeds: Warranty and Quitclaim

Two types of deeds are commonly used in real estate transactions: warranty deeds and quitclaim deeds.

Warranty Deed: A warranty deed establishes ownership and explicitly promises the new owner that the grantor/seller holds good title to the property. A good title means no encumbrances on the property, such as liens or easements.

There are two types of warranty deeds, general warranty deeds and special warranty deeds. The most common way to transfer property is through a general warranty deed (sometimes called a "grant deed"). A general warranty deed guarantees good title from the beginning of time. A special warranty deed only guarantees good title during the seller's time of ownership.

Quitclaim Deed: A quitclaim deed establishes the ownership interest the grantor/seller has in the real estate but does not guarantee good title. Quitclaim deeds are most commonly used to clear up title problems. They're also used to transfer property between spouses after a divorce or for informal title transfer between friends or family members.

In simpler terms:

  • A warranty deed says: "I promise that I own the property I am giving you and the title to it is good"
  • A quitclaim deed says: "I'm giving you whatever interest I have in this property, but I'm not making any promises about it. My title might not be good, and someone else might even own the property, but whatever I have is now yours."

Holding Title: Joint Tenancy and Tenancy in Common

When two or more people purchase property together, they must also determine how they want to hold the title. The most common options are to hold the property as joint tenants or as tenants in common. (Note: the word "tenant" in this context is an old English term that means "owner.")

This decision can make a great difference in how the land is treated upon the death of a co-owner.

Joint Tenancy

joint tenancy involves the right of survivorship, which must be stated in the grantee clause. When one joint tenant dies, their share passes automatically to the surviving joint tenant. This happens whether the deceased owner has a will. It happens even if the deceased owner's will attempts to leave their interest in the land to someone else.

Joint tenancy is a popular form of co-ownership between married couples because there is no need for a will or probate, which can save significant time and money.

A few states also recognize "tenancy by the entirety." This form of joint tenancy can only be created between married couples.

Tenancy in Common

Tenancy in common is a form of shared ownership in which two or more people own land without the right of survivorship. When a tenant in common dies, their interest passes to the people named in their estate plan rather than to the other owner(s).

Recording the Deed

The final step in conveying property is recording the deed, mortgage, or other legal document in the county where the real property is located. The name of the county office that handles real estate records varies from state to state. It is commonly called the county recorder's office. It can also be a land registry office, registrar of titles, or register of deeds.

The recording is extremely important. An owner's interests are not fully protected unless the documents are in the public record. The sequence in which deeds and other documents are recorded is important in determining the priority of claims against the property.

Get Legal Help Transferring Property

Property transfers often involve the largest financial transactions in a person's life. The decisions you make during this process could affect you and your heirs. Talk with a local real estate attorney to get accurate legal advice.

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