Transfer of Property
October 12, 2020
Today, we discuss the different ways property can be transferred. Property can be transferred in a few different ways, depending on the circumstances. The most common way to transfer property is through voluntary alienation. This is what we call the process of someone selling their house of their own free will. Another way property is transferred is through a will. When a property owner dies, the property will be transferred according to the will of the deceased. Lastly, we will discuss the most unfortunate way property is transferred, through involuntary alienation. This simply means the property owner did not choose to sell the property of their own free will. This can cover several different circumstances, such as foreclosure, adverse possession, or a property owner dying intestate (without a valid will).
A typical sale of real estate is considered to be a transfer of property by voluntary alienation. “Voluntary,” tells us this is an act of your own free will. “Alienation” simply means transfer. Basically, this is a fancy way of saying you sold your house. This is accomplished by the grantor (seller) giving a deed to the grantee (buyer). Thus, the title is transferred to the buyer.
There are several types of deeds that can be used in the transfer of real estate. A general warranty deed is by far the most commonly used type of deed. Several promises are made to the buyer, which is why this deed provides the best protection for the buyer. One promise made by the seller is what we call the covenant of seisin, which means that the seller owns the property. Another promise made by the seller is a promise of quiet enjoyment, meaning that the buyer does not have to worry about any third-party claims against ownership of the property in the future.
The second type of deed that can be used is called a special warranty deed. This type of deed puts a time frame on the seller’s promises. The seller promises everything has been alright since they have owned the property; however, there are no promises before that. This is commonly used by relocation companies who own property for a short time and then resell the property. With a bargain and sale deed, the only promise the seller makes is that the seller owns the property. The fourth type of deed is called a quitclaim deed. This is where the seller quits claiming rights to the property but makes no promises whatsoever. A quitclaim deed provides the least amount of protection for the buyer because no promises are made, not even the promise of ownership. Quitclaim deeds are typically used to quiet a cloud on the title. A cloud on the title means that something is not quite right, such as an ownership dispute, or a misspelled name. Quitclaim deeds can be used to resolve these types of problems.
With a Will
Real estate can be transferred through a will. If a person dies with a valid will, we call that testate. Conversely, if a person dies without a valid will, we call that intestate. If a person does die with a valid will, the person named in the will to carry out that will is referred to as the executor.
Real estate can also be transferred by what is called involuntary alienation, which is a transfer of property without owner consent. This can happen when a person dies intestate (without a valid will), causing the courts to determine who receives the property. The property then passes according to what we call descent. Descent refers to the person the property will descend to. Property can be transferred through adverse possession, which is basically legalized stealing. Adverse possession occurs when one uses someone else’s property continuously, openly, and without permission for a certain period of time (usually 10 or 15 years). That person can then obtain ownership of the property they have been caring for. This is similar to an easement by prescription; however, adverse possession actually allows one to gain ownership of the entire property, not merely an easement.
Another type of involuntary alienation is a foreclosure sale, where one receives a tax deed or a sheriff's deed to a property being auctioned off. Sometimes property can even be transferred by water or wind through a process called erosion. Erosion is a gradual wearing away of soil. Accretion is a gradual buildup of soil. If we have a slow-changing event where the soil erodes away and builds up somewhere else, one can actually gain or lose land. Let's contrast that with an avulsion, which is a sudden change or sudden transfer. This commonly occurs after a flood, as a stream or river might change course. A property line that flows along the stream or river remains intact, regardless of how the stream or river may have changed course. In other words, no one loses or gains land. The important distinction here is that an avulsion is a sudden change, and therefore does not cause the title to transfer. One more way property can be transferred is through a quiet title suit. If we have a cloudy title due to an ownership dispute or a misspelled name, usually that can be resolved through a quitclaim deed. If a quitclaim deed does not work, the next step is to go to the court where a judge will determine who rightly owns the property. In an ownership dispute, this is referred to as a quiet title suit.
Remember, voluntary alienation simply means you are selling your house. This is the type of property transfer you want to be a part of! Involuntary alienation basically means the property is being transferred without the owner consent. This is where we don’t want to be! And lastly, make sure you have a valid will. Don’t die intestate and leave your property to Uncle Sam! I hope this has given you a good understanding of the different ways property is transferred. Time to knock out that exam and start your career!
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