Sacramento real estate attorneys know that the transfer of property in California can be a complex process. Nonetheless, many people choose to prepare much of the paperwork by themselves. Below is an overview of the process and some of the common pitfalls a do-it-yourselfer might encounter without the aid of an experienced legal professional.
Most people are so preoccupied with the financial aspects of buying or selling property that the actual mechanics of the transfer get overlooked. Especially in light of the mortgage crisis, those with less-than-stellar credit often are finding banks that are much less willing to lend. If they are lending, many banks are doing so at higher interest rates if they view the borrower to be a credit risk. The first pitfall to avoid in transferring title in real estate is to think that the process is over once the capital is secured.
The actual transfer of real estate is a highly technical process which can be made even more so if the real estate has unique features or the improvements upon the real estate are substantial. The official mechanism of real estate transfer in California is a “quitclaim deed”. Quitclaim deeds are, in essence, legal contracts signed in the presence of a notary in which the transferor (the “grantor”) grants the property described to the transferee (the “grantee”). The most crucial – and most overlooked – portion of this document is the description of the property and its improvements.
The reason the description is so crucial to the transfer is that a quitclaim deed must be absolutely precise in what tangible and intangible things are to be transferred. Without this precision, the grantor and grantee run the risk of creating a situation in which the parties and the State are unsure of who actually holds title to the item. Title can be described as the right to use – and exclude others from – an item of property. If the description of an item of property is vague or ambiguous on a quitclaim deed, its ownership may later be disputed.
In the case of real property rather than tangible property, the grantor and grantee must be exceptionally careful that the description of the property includes the city, county, and state in which the parcel sits. Additionally, a well written description of real property will include some language to delineate the parcel from adjacent parcels, as well as the access rights to any natural resources within the property. For example, the quitclaim deed should accurately describe any water access rights or restrictions, as well as zoning prohibitions that may affect the value of the property, among other things.
The quitclaim deed also contains important tax information related to the transfer. The taxed amount is tied to the value of the property. In some cases, certain transfers may be exempt from this taxation.
If the prospect of self-preparing such an important legal document seems daunting, consider contacting a California real estate lawyer who is familiar with the complex legal language needed to secure the transfer. Property transfers happen infrequently for most people. In our area a Sacramento real estate attorney will be more familiar with the process and better equipped to anticipate any pitfalls.
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