If you are planning to leave a home to an heir or get married, you may be considering adding a name to your deed. However, all deeds are not created equal so you’ll want to be careful how you go about changing your deed. Let’s look at how to add a name to a deed.
Types of Deeds
In North Carolina, there are three kinds of deeds used to claim ownership of a property.
General Warranty Deed
The general warranty deed covers all aspects of past title implications and is usually backed by a title company that insures the deed based on their historical research. This is a clear title that gives you full legality to sell or transfer the property. It is best to possess this type of deed and only use a title company or attorney to edit this type of title.
Special Warranty Deed
Has a limited warranty that ensures to interested buyers that the owner has no liens or has given or sold any of the ownership interest in the property. There is no warranty on what could have happened before the owner bought the property.
Quitclaim Deed
A quitclaim deed is the least protection for an owner. There is no guarantee about what the owner may have done to encumber the title to the property. If the owner has no assurances about the title, this is the deed to use.
You can convey real estate to another through a deed. Deeds are recorded at the Register of Deeds in the county where the property is located and contain these essential details:
- Name of the Grantor (the owner)
- Name and address of the Grantee
- Grantor Signature in front of Notary
- Name of the preparer (attorney)
- Notary signature and insignia
Dangers of Adding A Name to Deed
It is possible to draw up your own deed agreements without an attorney, but it is not advisable because of the complexity of these types of documents. Laws change frequently and the language is not easily understandable. An attorney whose focus is on estate planning and these types of transactions will have the knowledge you need to draw up a deed properly so that it has legal standing for the long-term.
Transfer Using a QuitClaim Deed
A quitclaim deed is the most easily understood type of deed. If you add a name to this document, sign in front of the notary, and file at your clerk of court, you have effectively given someone else joint title to your property. This only works if you file everything exactly as needed. Even done correctly, you could cause yourself tax headaches, mortgage issues, and home insurance hikes.
Selling With a QuitClaim Deed
If your new co-owner decides to sell the property later with their quitclaim deed, they will have to jump through legal hoops to reobtain a general warranty deed. Potential buyers expect to purchase a home that is free and clear of encumbrances.
When you transfer property with a quitclaim deed you are only transferring whatever ownership interest you have. There is no claim that you have a clear title or that you are even sure that you own the property.
A seller with a quitclaim deed would need to contact state offices, title companies, insurance companies, and your mortgage company to find out how to proceed legally. A cloud-free title is essential to potential buyers.
Mortgage Terms
Another important issue is checking with your mortgage company if you have one. Sometimes, if you add another owner to the deed, your mortgage company can invoke their right to call the loan. In other words, your entire mortgage could be due as soon as you add another owner to the deed!
Additionally, if you use a quitclaim deed to give all interest in a house to a spouse, remember that the mortgage company still expects you to pay if your name is on the loan.
Get Help
The easiest way to add a name to a deed is with an estate planning attorney who understands what the issues are. Make sure that you are thoroughly familiar with all of the questions that come up with property transfer and which agencies and companies you will need to use to complete the transfer of a portion of your ownership interest. This can be a complicated process, but it is not so difficult with your attorney on your side.