Quit Claim Deed
10-12-2005, 07:09 PM
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Quit Claim Deed
Question for you all....
Back in 1997, me and my brother bought a house together....we're both on the mortgage and the deed/title. We were both single then.
I got married last year and I'm getting a new house. My brother will be buying out my share. Are there any problems with doing a quit claim to my brother (so only his name is on the title) but leave the mortgage alone (yeah, but I really trust him)?
Does my wife have to sign the quit claim deed too? It's only my name on the current deed.
Does quit claiming do anything to the mortgage?
My brother will be paying me for my share of the house after he sells his stock. The bank where I'm getting a new loan for our new house needs proof of where that money is coming from and they want the following to prove it:
*appraisal of me and my brother's house to make sure that there is sufficient equity: (appraised value minus principle left on loan)/2 > amt he is paying me
*copy of deed with both our names
*copy of quit claim deed with just my bro's name on it
*copy of check he gives me
*copy of deposit slip after I've deposited his check
The bank actually said an easier way is to sign their "gift letter"....but if you read the words, it states that the amount I receive from my brother is only a gift and nothing else in return. The bank thinks I'm anal and that the chances are slim that the IRS would get it. If I signed that letter, then I will be held liable to pay taxes on the amount....and I can't be exempt from the gains! I know the chance of that is very very small, but anything can happen!
Does anyone know of an easier way that wouldn't require all this?
Back in 1997, me and my brother bought a house together....we're both on the mortgage and the deed/title. We were both single then.
I got married last year and I'm getting a new house. My brother will be buying out my share. Are there any problems with doing a quit claim to my brother (so only his name is on the title) but leave the mortgage alone (yeah, but I really trust him)?
Does my wife have to sign the quit claim deed too? It's only my name on the current deed.
Does quit claiming do anything to the mortgage?
My brother will be paying me for my share of the house after he sells his stock. The bank where I'm getting a new loan for our new house needs proof of where that money is coming from and they want the following to prove it:
*appraisal of me and my brother's house to make sure that there is sufficient equity: (appraised value minus principle left on loan)/2 > amt he is paying me
*copy of deed with both our names
*copy of quit claim deed with just my bro's name on it
*copy of check he gives me
*copy of deposit slip after I've deposited his check
The bank actually said an easier way is to sign their "gift letter"....but if you read the words, it states that the amount I receive from my brother is only a gift and nothing else in return. The bank thinks I'm anal and that the chances are slim that the IRS would get it. If I signed that letter, then I will be held liable to pay taxes on the amount....and I can't be exempt from the gains! I know the chance of that is very very small, but anything can happen!
Does anyone know of an easier way that wouldn't require all this?
10-12-2005, 07:22 PM
#2
Damn - get a real estate attorney to help you because you don't want to get in any IRS trouble. I don't think the IRS will take "But the bank said I could" as a good excuse. Also, you can only give a $10K gift to someone without them having to claim it as income....
10-12-2005, 09:39 PM
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Originally Posted by gsrblack
Question for you all....
Back in 1997, me and my brother bought a house together....we're both on the mortgage and the deed/title. We were both single then.
I got married last year and I'm getting a new house. My brother will be buying out my share. Are there any problems with doing a quit claim to my brother (so only his name is on the title) but leave the mortgage alone (yeah, but I really trust him)?
Does my wife have to sign the quit claim deed too? It's only my name on the current deed.
Does quit claiming do anything to the mortgage?
My brother will be paying me for my share of the house after he sells his stock. The bank where I'm getting a new loan for our new house needs proof of where that money is coming from and they want the following to prove it:
*appraisal of me and my brother's house to make sure that there is sufficient equity: (appraised value minus principle left on loan)/2 > amt he is paying me
*copy of deed with both our names
*copy of quit claim deed with just my bro's name on it
*copy of check he gives me
*copy of deposit slip after I've deposited his check
The bank actually said an easier way is to sign their "gift letter"....but if you read the words, it states that the amount I receive from my brother is only a gift and nothing else in return. The bank thinks I'm anal and that the chances are slim that the IRS would get it. If I signed that letter, then I will be held liable to pay taxes on the amount....and I can't be exempt from the gains! I know the chance of that is very very small, but anything can happen!
Does anyone know of an easier way that wouldn't require all this?
Back in 1997, me and my brother bought a house together....we're both on the mortgage and the deed/title. We were both single then.
I got married last year and I'm getting a new house. My brother will be buying out my share. Are there any problems with doing a quit claim to my brother (so only his name is on the title) but leave the mortgage alone (yeah, but I really trust him)?
Does my wife have to sign the quit claim deed too? It's only my name on the current deed.
Does quit claiming do anything to the mortgage?
My brother will be paying me for my share of the house after he sells his stock. The bank where I'm getting a new loan for our new house needs proof of where that money is coming from and they want the following to prove it:
*appraisal of me and my brother's house to make sure that there is sufficient equity: (appraised value minus principle left on loan)/2 > amt he is paying me
*copy of deed with both our names
*copy of quit claim deed with just my bro's name on it
*copy of check he gives me
*copy of deposit slip after I've deposited his check
The bank actually said an easier way is to sign their "gift letter"....but if you read the words, it states that the amount I receive from my brother is only a gift and nothing else in return. The bank thinks I'm anal and that the chances are slim that the IRS would get it. If I signed that letter, then I will be held liable to pay taxes on the amount....and I can't be exempt from the gains! I know the chance of that is very very small, but anything can happen!
Does anyone know of an easier way that wouldn't require all this?
I'm a mortgage broker and actually have a similar transaction signing tomorrow. In this case, the husband is refinancing his wife off the mortgage prior to the divorce. In this transaction, the bank had no interest in whether the wife was quite claimed off. It was actually just a requirement of title insurance.
I think the bank is conditioning you for all this because you are not free and clear from all liability of the current property. You still exist on that mortgage so the bank's only verification that you have been settled out of the property is tracking the payout from source to deposit, followed by a quit claim.
They other way to remove you would be to refinance you off the property. Your brother would just refiance it into his name; just like my transaction signing tomorrow.
Those are pretty much your choices. One way or the other, the bank needs a paper trail that you have zero financial liability to that property.
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