What Is A Quitclaim Deed and How Can It Be Used During A Divorce

How a Quitclaim Deed Affects a Mortgage in Divorce

A quitclaim deed is used to transfer one person’s interest in a property to someone else. For instance, a parent could sign a quitclaim deed granting a child his or her interest in the child’s residence. If the person signing the quitclaim deed has no interest in the property to begin with, the deed transfers nothing. In other words, a quitclaim deed does not guarantee actual interest in a property.

In most cases, quitclaim deeds are used between family members or spouses. The presumption is that the family members know that the person signing the deed actually has an ownership interest to transfer.

If a couple gets divorced and one spouse transfers his or her interest in their home to the other with a quitclaim deed, the spouse who now has no interest in the property may be held liable for the mortgage debt – if the mortgage itself has not been adjusted. This is especially true in community property states. According to community property law, all debts a couple takes on during their marriage are considered the responsibility of both spouses – no matter whose name is on the loan.

How a Quitclaim Deed Affects Property Owned Outside Marriage

Some states automatically consider any property obtained during a marriage as joint property. However, property that either spouse owned before they were married may be considered separate property.

It is important to note that separate property can be changed to community property by way of a quitclaim deed through a process known as transmutation. If a spouse indicates in writing that he or she intends to transfer separate property into the marriage, the door will be opened for a spouse to claim a share of that property should the marriage end in divorce.

Transmutation can also work in the reverse. For example, if a couple purchases a home jointly – but one spouse transfers ownership to the other by way of a quitclaim deed when they divorce – the property will change from community to separate property. In this case, the burden of proof will be on the spouse who retains an interest in the property to prove to the court that the other spouse has given up his or her interest in the property. Otherwise, the court may treat the home as community property.

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