Legal Question in Real Estate Law in Illinois
Quit claim deed for condo?
I recently married and moved out of my condo.My mother-in-law moved in, and we allow her to live there for free,therefore, she is not a renter.My condo asociation claims she is not an owner-occupant and technically is a renter.They would like me to sell or move back in, as my unit being non owner occupied exceeds the 20% non owner occupied limit, that most mortgage companies require to process a loan if another unit owner should decide to sell,and a prospective buyer applies for a mortgage loan. I would like to add my mother in-law to the condo title, thereby making her a unit owner.Would a QUIT CLAIM DEED allow me to add her on to the title,with my name, as an owner?How easy would it be for me to remove her from the title,once she decides to move?
2 Answers from Attorneys
Transfer of Ownership of Real Estate
You may transfer ownership by quit claim deed. However, such an action must have the consent of your mortgage company or you may be in default of your mortgage company bond and mortgage. In addition, the transfer back is simple as long as your mother in law signs a deed. I suggest you consult an attorney. The actions you propose are not as simple and you could create some future problems. The condo documents should be reviewed to determine if you have another option.
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With the advice of your own local attorney, you can do it.
Be sure your mortgage will allow it -- the agreementusually is to 'accelerate' (make the balance due in full)any time there's a tweak to the title, but they'll usuallyagree in writing if you give them reason to.
THEN assign her some interest, perhaps only a few percentif that's possible, but have her sign in advance an undateddeed transfer back to you, which you keep (at your atty's office and in his safe); also you might want to see that sheputs that into her will, as a fall-back, although presumablyyou would be wise enough to take back the ownership if shefell deathly ill and have the document dated before her deathand the new owner (you -- or whoever you might be selling to) registers the deed even before she dies -- just to avoid morecomplications.
This really isn't a bad scheme.
Frankly, what power does the condo assoc. have?
Their definition of rent -- even without money -- might win, push comes to shove, although your 'she'sonly a guest not a renter' theory could also win.
I should think that someone's getting a mortgage elsewherein the building is pretty removed from your situation in yourone unit, but perhaps they need to hold the line somewhere orelse everyone will be having "guests" some of whom may coincidentallybe making "gifts" to their unit's owners ....
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