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There are many situations in life when it feels natural to help out another family member by transferring title of land or property from one person to another. Perhaps you’re looking after your ageing parents and want to grant them a measure of independence, or perhaps you have just married and would like to build a home with your new spouse. Whatever your circumstances, there are ways for you to transfer land title between family members in order to address those needs. To do this, you will need the services of an attorney who is familiar with estate planning and real estate laws in your area. The process will be much smoother if both parties have legal representation throughout. Remember that there are local laws regarding these kinds of transfers, so it’s important that you speak to a professional before moving forward with any agreements.
Why Transfer Property Title Between Family Members?
There are many reasons why you might want to transfer land title or property between family members. Perhaps you have young children who are learning to navigate life on their own and would like to give them a boost by gifting them a valuable asset. Maybe you have aging parents who would like to stay in their home but could use some additional support in the form of monthly payments. Whatever your circumstances, there are ways for you to transfer land title between family members in order to address those needs. You may be wondering why you should transfer title of land to a family member in the first place. There are a number of reasons, but the most important one is that it is much easier to get a mortgage when you’re not the owner of the property. If you own the land and building, you will have to get a mortgage on that property. If, on the other hand, the title of the land is in someone else’s name, you can get a mortgage against that person’s assets instead.
The Steps to Transferring Property Title Between Family Members
There are a number of steps you will want to follow in order to transfer title of land between family members. In general, the process involves a title search, drafting an agreement, and then executing the agreement. Each of the three steps is outlined below. – Title Search and Chain of Title – First, you will want to conduct a title search for the land in question. This will help you understand who owns the land and what rights are associated with the property. Depending on where the land is located, you may even be able to trace the title all the way back to the original grantor. – Drafting the Agreement – Once you understand the current state of the title and the rights associated with it, you will want to draft an agreement between the parties that details how the title will be transferred. It is important to remember that any agreement made between family members must comply with all local laws. – Executing the Agreement – Once you and the parties involved have all signed the agreement, it must be executed in front of a notary.
Responsibilities When Transferring a Property Title
There are certain responsibilities that are associated with transferring title of a property between family members. If you are the person receiving title to the land, you will be responsible for paying property taxes and any other fees associated with keeping the land in good standing. In some cases, you may even be responsible for paying off any existing mortgage on the land. Conversely, if you are transferring title to a family member, you will be responsible for paying any outstanding taxes and ongoing fees related to keeping the land in good standing. You may also be responsible for paying off any existing mortgage on the land, if the agreement between you and the other party specifies such terms.
Step 1: Title Research and Confirming the Chain of Title
First, you will want to conduct a title search for the land in question. This will help you understand who owns the land and what rights are associated with the property. Depending on where the land is located, you may even be able to trace the title all the way back to the original grantor. Once you have a clear picture of the state of the title, you will want to confirm that you have the authority to transfer the title to a family member. Generally, this is done by obtaining the signatures of the current owner(s) on a valid deed of gift. You may also have to have the deed of gift notarized.
Step 2: Assessing the Value of the Land and Any Debt
Next, you will want to assess the value of the land in question. Depending on the terms of the agreement, you may want to have a professional appraise the land in order to provide a more accurate value. In addition to assessing the value of the land, you will also want to investigate any existing debt on the property. This information will be important when drafting the agreement.
Step 3: Creating the Agreement for the Transfer of Title
After assessing the value of the land and any debt associated with it, you will want to draft an agreement between the parties that details the transfer of title. You will want to include the terms and conditions of the agreement, as well as any other details that you and the parties involved decide are necessary. It is important to remember that any agreement made between family members must comply with all local laws.
Step 4: Notifying Third Parties of the Change in Title
Finally, you will want to notify third parties of the change in title, such as the bank that holds the mortgage on the land. Depending on the terms of the agreement, you may be able to notify the bank by submitting a written change of ownership notice. It’s important to read the fine print on the agreement and understand what is required in order to notify third parties of the change in title.
Bottom Line
When it comes to transferring property title between family members, it’s important that you do everything by the book. This will help you avoid any unnecessary complications down the road, especially if the land is ever put up for sale. In addition, keep in mind that some laws restrict the ability to transfer title of land between family members. That being said, if you follow these steps carefully and work with an experienced real estate attorney, you should be able to transfer a property title between family members with relative ease.