A quitclaim deed can give you title to real estate fairly simply -- but it can't put your name on a mortgage. If your mortgage is insured by the Federal Housing Administration, that doesn't change the quitclaim's powers. Your relative can relinquish his claim to a property with a quitclaim deed, but it will take more work to put you on the mortgage.
A quitclaim deed does what it sounds like: the grantor -- the person signing it -- quits any claim to the property he ever had. Unlike warranty deeds, there's no guarantee the title is good. If the grantor bought the house from someone who didn't have the right to sell, a warranty deed lets you sue the grantor, but a quitclaim deed doesn't. It's risky to buy a house with a quitclaim deed, but it's quite common for family members to use them to transfer title.
Even after the grantor gives up title with the quitclaim deed, she's still obligated to pay any mortgage that she owes. This can become a problem, particularly in divorce cases, if there's no follow-through. An ex-spouse who gives up title with a quitclaim may discover her spouse never refinanced the mortgage to get her name off it -- so she's still legally obligated to make payments. Likewise, you can't become the mortgage co-borrower without going back to the lender to refinance.
Adding Your Name
With an FHA-backed mortgage, it's often easier to add a name to the mortgage than with a conventional loan. FHA offers "streamline" refis, which speed up the process if your relative already has an FHA mortgage. Your grantor can qualify if the refi rate is lower than what he's paying now. Streamline refinancing requires a lot less paperwork and time to complete. You may not even need to undergo a credit check before the FHA approves you.
A quitclaim deed can't transfer title if the grantor screws it up. The law in every state says a valid deed needs the names of the grantor and grantee -- in this case, you're the grantee -- the date of the title transfer and the legal description of the property. The grantor has to sign the deed in the presence of a notary. Some states also require that you sign, and that the signatures be witnessed. If the grantor ignores the rules, you could end up without the title.
- How to Change the Title on a Mortgage
- How to Add a Beneficiary to a Mortgage Deed
- Can I Do a Quitclaim Deed if My Brother & I Own a Home Together with a Mortgage?
- Mortgage Vs. Deed
- Trustee Deed Vs. Warranty Deed
- Names That Need to Be On a Mortgage
- What Kind of Deed for a Paid-Off Mortgage?
- Why Is a Spouse Required to Sign on a Mortgage Loan When They Are Not the One the Loan Is Given To?