Before a property can be sold, it must have a clear title. Mortgage companies will not issue a loan until it determines whether the seller really owns the home. Insurance companies won’t issue a policy, and you cannot buy a property if the title is not clear.
Even worse, if the sale somehow does go through and the title is defective, you can lose the property. A clear title or a clean title is free from issues that could jeopardize ownership. This can include boundary disputes or easements.
Lenders go through a thorough search to ensure that the title for a property is clear. There are two processes that can be used in the case of a defective title. Although they are sometimes used interchangeably, a quit claim deed and a quiet title action are not the same things.
What Is a Quiet Title Action?
A quiet title action is a legal lawsuit that removes someone else’s interest from a property title. The action starts an investigation into who owns the property after a conflict has arisen. For example, if there are issues with adverse possession claims, taxes, or survey issues, a person may begin a quiet title action.
If there are multiple claims on the property, you may need to file a quiet title action to get a mortgage loan. However, it’s important to consider this action carefully. Quiet title actions are expensive and can take anywhere from eight weeks to six months to complete.
After the evidence has been gathered, the judge evaluates the information and makes a judgment. When no one contests the lawsuit, the title may be cleared quickly. A quiet title action may be useful if you’re attempting to purchase a home or property that’s been unoccupied. It is in your best interest to consult an experienced real estate attorney who can guide you through the process.
What Is a Quit Claim Deed?
While a quiet title action is a legal lawsuit that removes someone else’s interest from your property, a quit claim deed is a way to hand over your interest to someone else or for them to give their interest to you. It is quick, inexpensive, and convenient when it is the appropriate remedy for your situation.
In essence, it’s the transfer of all rights, title, and interest in a property deed from one person to another. There is no guarantee as to the condition of the title when you use a quit claim deed. If you are being handed property through a quitclaim deed after an inheritance or divorce, it’s in your best interest to ensure that the title is also clear. This is one of the fastest ways to transfer property during a divorce.
What’s the Difference, and Does it Matter?
Although the end result is the same, the process is significantly different. You would not want to use a quiet title action when it’s not necessary. This is because the action is more expensive and takes more time. A quit claim deed requires the signature of both people on the proper form, and it must be filed with the court.
In some circumstances, you may attempt to use a quit claim deed and must resort to a quiet title action. For example, if a property is awarded to one spouse after a divorce, a quitclaim deed is the fastest way to transfer the property.
However, if one spouse disappears and will not sign the quitclaim deed, the second spouse must pursue a quiet title action to remove their ownership interest from the property. Although these are different methods, the end result is nearly the same.
Contact Wagner Zemming Christensen, LLP, with Your Real Estate Needs
If you are involved in the transfer of property, consult with the attorneys at Wagner Zemming Christensen, LLP. Our experienced real estate attorneys have over four decades of combined experience, and they can determine the right tool to get the job done in your situation. Call our office today at 951-686-4800 to schedule your initial confidential consultation.