Property Transfer Procedures

Without a property deed, the keys don't mean much.
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To transfer title to real estate takes more than a handshake and, "Congratulations, it's yours." Whether it's a gift, an inheritance or a sale, a title transfer needs a signed, written document, which you have to record with your local government. The exact rules for title transfers vary by state and even by county, but the basic principles apply everywhere.


Deeds are the standard tool for transferring property title. A legal deed includes the names of the grantor and grantee -- or the seller and buyer, respectively. It also includes the legal description of the property. That isn't the street address, although that's usually written on the deed, too. Instead, it's the way the county's land records identify the property, by the lot number or boundary markers, for example.


The seller always signs the deed, and in some states the buyer does, too. Just signing a deed isn't enough to transfer title. The seller has to sign in front of a notary public, who also signs and applies his seal to the deed. In some states, you also need the signature of a witness who watched the seller sign the deed. The witness has to be someone who isn't otherwise involved in the title transfer.


Once the seller transfers title with a deed, it's legally binding even if the buyer hides it under her mattress. However, it's better to have the seller file the deed with the county recorder or registrar, even though you have to pay a fee to do so. If the deed isn't filed, the county records indicate the seller still owns the property. If the seller doesn't pay her debts, her creditors might place a lien on the house, even though it belongs to you.


The seller needs to include any "encumbrances" on the property, such as liens or easements, in the text of the deed. If there are legal restrictions on what the buyer can do with the land -- homeowners association covenants, for example -- those belong in the deed, too. Some states require added information for a legal title transfer. In Minnesota, for example, the seller has to file a well-disclosure statement identifying the location of any wells on the property.

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