Quit Claim Deed

Started by MichaelO4 • 10 replies • 2704 views

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MichaelO4 (Montana)
Posts: 40

Posted:

Our COA has a Quit Claim Deed on file which grants "all the right, title, interest and claim" of "all common area" of all phases of our condominium
project from the developer/declarant to our COA.

Question: Is this the standard instrument which transfers all control of the COA from the declarant to the COA? If not, what other instrument serves this
purpose?

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

What is a COA? Child of Alcoholic, Clowns of America?

MichaelO4 (Montana)
Posts: 40

Posted:

Condominium Owners Association

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

I wouldn't even attempt a transfer from the developer/declarant to the members without being represented by a lawyer. Too many things to go wrong and no one is looking out for your interest. Either get the homeowners together to kick in a few bucks for a lawyer, or use existing funds if you already have that right.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quit claim deed can be used, yes. But I wonder why he didnt use a warranty deed. Are there issues with the common areas? Liens?

MichaelO4 (Montana)
Posts: 40

Posted:

No issues or liens that the COA's aware of.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Not that you are aware of? What steps have you taken to find issues? Was a title search done before the common area was turned over to the members?

MatthewW4 (Arizona)
Posts: 500

Posted:

Michael,

There are times when a quit-claim deed is the proper instrument for the transfer of property. Most of the time a quit-claim deed is not the proper instrument, and may not even be a legal instrument, but this is the deed form they sell at the mailbox rental stores so everyone too cheap to get legal advice uses it.

All a quit-claim deed says, in effect, is "I transfer my interests, which may be none, to you." I can lawfully execute a quit-claim deed to you for my interests in the Grand Canyon or the Brooklyn Bridge. I do not claim to own either one but I will gladly take your money to sell you my interests in either or both.

I am wondering if there should be a deed at all for the common property. My understanding is that condo owners own their own units plus an undivided portion of the common areas. If that is the case, then the quit-claim deed would then be in conflict with every owner's (including your own) deed. That is, you hold a deed that gives you a property interest in an undivided portion of the common areas and the association has this quit-claim deed to the very same real estate.

Your board needs to consult with its attorney to determine whether this is a proper deed and what you must do to rectify it. Usually, a person holding a quit-claim deed will need to file a quiet-title action in superior court (or its equivalent).

BruceF1 (Connecticut)
Posts: 2,535

Posted:

Quote:

Posted By MichaelO4 on 09/10/2013 8:21 AM
Our COA has a Quit Claim Deed on file which grants "all the right, title, interest and claim" of "all common area" of all phases of our condominium
project from the developer/declarant to our COA.

Question: Is this the standard instrument which transfers all control of the COA from the declarant to the COA? If not, what other instrument serves this
purpose?

Matthew has pretty much hit the nail on the head. All a Quit Claim deed does is transfer whatever claim or interest the grantor of the deed has in the property, to you. There is no guarantee that the title is free and clear.

A Quit Claim deed is often used to transfer a spouse's interest in a property to the other spouse in a divorce settlement. It is also often used in an impending death situation, such as a spouse with a terminal illness transferring their interest in the property to the surviving spouse, or a parent to a child or children. Although a Quit Claim deed does not guarantee clear title, if the original deed was a warranty deed, then it is just about as good. For example, suppose a husband and wife purchase property and receive a warranty deed. If one spouse's interest in the joint ownership is later transferred by that spouse to the other by a Quit Claim deed, then it's pretty certain that the deed will have a clear title.

This is one reason why title searches are so important.

RichardP13 (California)
Posts: 1,767

Posted:

Bruce,

Would you consider a person that was given title to the property through a Quit Claim to be an Owner as defined in an Association's CCRs. As a lender for Countrywide, we wouldn't take a Quit Claim for much of anything, as it never obligated the new title holder to pay the loan, only the person that was subsequently on the loan, grant deed or warranty deed. When escrow closed on a property, that grant or warranty deed was the proper paperwork to set the person up with the Association.

BruceF1 (Connecticut)
Posts: 2,535

Posted:

Quote:

Posted By RichardP13 on 09/10/2013 3:37 PM
Bruce,

Would you consider a person that was given title to the property through a Quit Claim to be an Owner as defined in an Association's CCRs. As a lender for Countrywide, we wouldn't take a Quit Claim for much of anything, as it never obligated the new title holder to pay the loan, only the person that was subsequently on the loan, grant deed or warranty deed. When escrow closed on a property, that grant or warranty deed was the proper paperwork to set the person up with the Association.

Maybe it depends on the circumstances and/or where you live.

My wife and I received a warranty deed when we purchased our home and the mortgage was in both of our names. When my wife became terminally ill she transferred her interest in the home to me via a Quit Claim deed. I then refinanced the home solely in my name. The bank required the Quit Claim deed before I was allowed to refinance solely in my name.

Perhaps the situation was different because my name was listed on the original warranty deed and on the original mortgage.

We owned a home in Massachusetts for over twenty years with a Quit Claim deed and we never had any trouble obtaining a mortgage or in selling the home.

Our CCRs (Declaration in Connecticut) say nothing about the type of deed. It defines a Unit Owner merely as the owner of a unit, not to include a person (or other entity) that has an interest in a unit solely as security for an obligation. So, yes, we would consider a person who owns a unit by means of a Quit Claim deed a Unit Owner.

Perhaps things are different where you live.

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