The Quitclaim Process Explained

The quitclaim process is something that many people go through when they are processing a divorce or absolving some other type of relationship with a joint property owner. This process is typically done quickly and most people do not fully understand it. Here are the basics of the quitclaim process and how it works.

Quitclaim Deed

A quitclaim deed is a document that can be used to remove an individual's ownership rights to a piece of property. If there are two owners of a piece of property and one of them signs a quitclaim deed, they are releasing any claim that they previously had to the property. This will release them from the deed of the property and will give full ownership rights to the other individual.

When it is Used

This process is commonly used during divorce receiving. For example, if one of the individuals in a marriage is going to continue living in the house while the other one moves out, a quitclaim deed could be used. The person that is moving out of the house will sign the deed and will vanquish any rights that they had to the property. The house will then come under the full ownership of the other spouse that is going to continue living in the property. 

The Process

When a quitclaim deed is going to be signed, the parties that are involved with ownership in the property will typically meet with a real estate professional. In most cases, this will occur at a title office while it can also occur with a real estate lawyer. The real estate professional will provide the quitclaim document that needs to be filled out. The document is typically only a one or two page form that requires basic information to process. Both parties will have to sign the deed and the real estate professional will guide them through the process.

Mortgage Issues

When dealing with this type of deed, it is important to realize that this has no effect on a property mortgage. Just because you are getting rid of your rights to a property, this does not necessarily mean that you are getting out of the obligation that comes with paying a mortgage. When a mortgage is paid off, then the parties that were originally on the mortgage will be relieved of their obligations.

This means that in many cases, when a quitclaim deed is signed, a refinance of the existing mortgage may also come with it. The party that is going to continue living in the property will generally refinance the mortgage and then the individual that signs the quitclaim deed will be removed from the obligation of paying for the mortgage. Without this vital step, if the person that lives in the house failed to make the mortgage payment, the person that moved out would still be partly responsible for it. This could damage their credit even though they have not lived in the property for years. 

blog comments powered by Disqus