Quitclaim Deeds in New Jersey Divorces

Transferring the Formal Marital Home Using a Quitclaim Deed

HouseWe are often asked, “Can you prepare a ‘quickclaim’ deed for me?”  Actually the term is a “Quitclaim” and not a “Quickclaim” but since the two sound so similar many people use the wrong term.  I always chuckle (to myself)  when I hear someone mention a “quickclaim” deed.  As amusing as the misuse of the word may be, deeds especially in the context of a divorce are very serious.

As part of equitable distribution in a divorce, it is not uncommon for one spouse to relinquish or give up their right to the marital home.  This is almost always done in exchange for some form of consideration in the parties property or marital settlement agreement (PSA or MSA). Quitclaim deeds are often used by ex-spouses to transfer their interest in the former marital home.  However, a quitclaim deed can be used to transfer an interest that is not between spouses or ex-spouses.

A quitclaim deed conveys only that right, title or interest that the grantor or owner has, or may have, in the property. It does not warrant that the grantor or owner has any particular title or legal interest in the property.

All New Jersey deeds must comply with N.J.S. 46:4A-9(a). The statute requires that all deeds intended to convey an interest in real estate, shall:

  1. identify the parties to the transaction;
  2. identify the property and the interest to be conveyed;
  3. evidence an intention to convey the interest through the deed or other instrument;
  4. be signed and delivered by the party conveying the interest in property; and
  5. be accepted by the party to whom the interest in property is conveyed.

Quitclaim deeds have additional  specific requirements.  The deed must say “Quitclaim Deed” It must also have  specif language identifying the nature and quality of the transfer.  Text such as,”This deed is called a Quitclaim Deed. The Grantor makes no promises as to the ownership of title, but simply transfers whatever interest the Grantor has to the Grantee.” or something similar is required.

It is important to realize a recorded quitclaim deed does not provide any protections or relief from any mortgage or note obligations.   Often times a property settlement agreement will require a spouse to transfer their interest in the former marital home.  This will be done by a quitclaim deed.  The spouse who received the former marital home will often be required to continue to make the mortgage payments and ultimately refinance the property within a specified period of time.

The spouse who signed the quitclaim deed may have believed they signed over their rights to the former marital home (which they did), however, they are still a signatory on the mortgage and the note.    If the spouse who received the former marital home stopped making mortgage payments and the bank or lender strated to foreclose on the home the spouse who signed over the property could be held responsible for the mortgage deficiency.   Additionally, the spouse who signed the quit claim deed may have their credit rating adversely affected.  In this situation the only way to protect the spouse who signed the quitclaim deed and transferred their interest in the former marital home is to have the mortgage and not cancelled.  Said another way, the ex-spouse who received the home typically must either refinance the home or sell it.

The lawyers at DeMichele & DeMichele are experienced family law and real estate attorneys.   If you are seeking advice on a divorce, or a real estate transfer we can help. Don’t hesitate to contact our firm online or call (856) 546-1350 today to schedule a confidential initial consultation.