Laws on Interspousal & Quitclaim Deeds in California

Interspousal grant deeds can be useful tools in a divorce.

Deeds are the standard document for conveying real estate title. In many cases, transferring title from a grantor -- the person giving up the property -- to the new owner, or grantee, is a straightforward cash-for-property swap; other cases are more complicated. In California, for example, when spouses convey title with an interspousal transfer grant deed, it has valuable tax benefits.

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Interspousal Transfer

In California law, grant deeds come with a guarantee that the grantor has not done anything to spoil the title she's conveying, such as selling the property to someone else. Couples can use an interspousal transfer grant deed to convey title from one spouse as an individual to both spouses as joint owners; to transfer property as part of a divorce settlement; or to transfer title to a trust, provided the transfer is for the benefit of the surviving spouse.

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Benefits

California state law places limits on how much property tax assessments can increase from year to year. That limit disappears when ownership changes: When a new owner takes title, the assessor will re-evaluate the property according to the current market value. Under state law, an interspousal transfer does not count as a change in ownership and does not trigger a reassessment. If the grantor has held on to the house for years, avoiding a reassessment could save the grantee a fortune in property taxes.

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Quitclaim Deeds

Grant deeds and warranty deeds give the grantee guarantees that the title is secure; the grantor accepts a degree of liability for any title problems, though the liability varies with the type of deed. Quitclaim deeds in California, like other states, offer no guarantees at all: A grantor using a quitclaim deed gives up any title she has but can't be held liable if there are title problems or if she has no title to give up. Quitclaim deeds are used for title transfers between family members or to have one party in a title dispute give up her claim.

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Considerations

In California law, a transfer of property is never conditional. Quitclaim and grant deeds state the consideration, if any, the grantor receives in return for the title. Any added conditions the grantor sets are void once the grantee receives the document, even if the grantee agreed to them. When using a quitclaim deed, another factor to consider is that quitclaims convey title but not responsibility for the mortgage. The grantor is still liable for any mortgage on the property unless she and the grantee work out an arrangement.

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