A quitclaim deed is a formal document that gives one person (the grantor) the right to sell or otherwise dispose of real estate to another (the grantee). Legal descriptions of the property and the grantor and grantee’s names are included in quitclaim deed transfers. They become a part of the public record after being filed with a county recorder’s office.
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Quitclaim Deed vs. Warranty Deed
Rarely are quitclaim deeds—also known as quick claim deeds—used to transfer titles in commercial real estate sales. A quitclaim deed form in California is more frequently employed when no money is exchanged in order to transfer an interest in a property. Adding or removing a person from an ownership group is one example. Other examples include:
- Transferring real estate between family members,
- Transferring real estate to a living trust (often as part of estate planning),
- Fixing mistakes and title defects from a prior transaction, and
- Correcting errors and title defects from a previous transaction.
Quitclaim deeds are less comprehensive than a warranty deed, another legal document, but they can quickly resolve property title disputes and facilitate property transfers among family members.
The property deeds that ordinarily go along with sales from one property owner to another are known as warranty deeds, and they include general warranty deeds and special warranty deeds (also known as grant deeds). They differ from quitclaim deeds in the following ways:
Guarantee Of Ownership
The act of signing a free quit claim deed does not establish the grantor’s authority to convey ownership of a particular piece of property. In some instances, grantors grant property that neither party knows the grantor owns (often to correct title issues). A warranty deed, on the other hand, can only be issued by the property’s legitimate owner.
Clear Title Assurance
A warranty deed attests to the existence of a free and clear title to real estate. It is created by a title company, which checks to make sure the property is unencumbered by liens for unpaid property taxes, lawsuits from previous owners (like the seller’s ex-spouse), or other legal claims. All of the property’s past ownership will be guaranteed by a general warranty deed.
A grant deed or special warranty deed only applies during the time that the seller has owned the property. A notary public’s stamp must be placed on both quitclaim and warranty deeds before they are submitted to the county recorder, city recorder, or county clerk. Some local governments impose a transfer tax on these transactions.
Conclusion
A quitclaim deed may be used if the seller lacks a title or other proof of ownership. This agreement transfers any claim the seller may have to the property to the new owner but makes no guarantees about that claim. Any liens against the property will be transferred from the seller to the buyer.
Because it guarantees that the grantor owns the property free and clear (and that no other party can make a claim against it), a general warranty deed offers the guarantee the highest level of protection. Even those periods when the grantor did not own the property are covered by this guarantee for its entire past. The grantor shall be liable for any breaches of this Agreement.