Legal Question in Real Estate Law in Colorado

Re: tranfer of 50% interest in real estate

There is a big difference; see homebuying.about.com for some definitions. When someone gives you a quit claim deed, all they are doing in transferring their ownership interest in the property, if any, to you. As the words imply, as to you, the person is quitting/refraining from making an adverse claim of ownership.

The Indians, for example, gave, for $24 in trinkets, a quit claim deed to the early Dutch settlers, for what later became part of New York City. However, those Indians were merely passing through the area, as they told the Dutch, so while the quit claim deed was valid and legally binding between the two groups, it actually gave no legal ownership interest to the Dutch.

A general warranty deed, however, is a statement that the transferor actually owns the property and will compensate you if in the future it is shown that he did not.

Both documents are valid without being recorded. The purpose of recording is that if it is done, then the law assumes anyone who purchases or tries to purchase the property after you have recorded it, is on notice of your recorded document. So they can not be a bona fide purchaser of the property interest; it is the same as if they had actual notice of your claimed interest. So you always want to record unless you want to keep the transaction secret. It is the listing of all such recordings of documents that a title insurance company is insuring; they are merely saying they have reported to you all documents that have been recorded against that property.

One title insurance company official told me that the policy they give to home buyers does not even include claims they are aware of but which have not been recorded; they charge an additional among to the lender to tell them of all claims they are actually aware of [seems to me that that opens them up to suit by a purchaser who later does have an adverse claim made against them].

Re: transfer of 50% interest in real estate

As noted in the prior answer, there are various substantive differences between the deeds.

I would advise, however, that you understand the taxation and other legal issues involved in a transfer. If you are transferring this as a gift, there are various gift tax rules that may be implicated.

You should also consider having a written agreement with the party (depending on the circumstances). These are called tenancy in common agreements and will determine various rules and rights between the owners. If you do not have an agreement and various conflicts occur, your only choice may be to go to court in a partition action which is time consuming and expensive.

In short, contact your accountant and talk to a Colorado attorney as to the agreement. It is money well spent. Good luck.