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What Are the Effects of a Quitclaim Deed?

Quitclaim deeds are used to transfer title or interest to another party without warranty. The seller (grantor) sells to the buyer (grantee) whatever interest the seller may have in the property, including all rights or ownership and use, if any. Use of a quitclaim deed is an explicit agreement that the grantor does not attest to or warrant anything with regards to the property and the grantee enters the transaction at his/her own risk.

The effects of a quit claim are dependent on the interest the grantor actually has at the time the quitclaim deed is executed. If the grantor is actually the owner, in fee simple, and the title is perfected, the effect of the quitclaim deed is similar to that of a grant deed in that ownership of the property along with the perfected title would transfer to the grantee. In another scenario, the grantor could be the actual owner but there is a cloud on or an action against the title. In this instance, the grantee would become the owner of the property but the grantor would have no obligation to assist in perfecting the title or defend against any action and the grantee would have no grounds to compel him/her to do so.

A quit claim does not affect obligations of the real estate such as restrictions and easements of record, nor does it transfer obligations or commitments of the grantor such as a mortgage. Since the real estate secures the mortgage, a quitclaim deed does not diminish the rights of the mortgagee (lender) though it can be argued that mortgage is more at risk if the real estate is not occupied by the mortgagor (borrower).  The security the real estate represents to the mortgage is unaffected by a quitclaim deed transfer since it is secured by the real estate until satisfied, regardless of whose name is on the title, which could result in the grantee losing the property in foreclosure proceedings if the mortgage goes into default. The obligation for the mortgage remains with the grantor, or whoever entered into the mortgage agreement, unless the mortgage company agreed to the assignment of the mortgage. In short, the grantor can give up any rights or ownership and still have responsibility for the mortgage on a property he/she no longer owns.