DIY FORMS, DO THEY WORK?
People often feel that property deeds are simple. Fill-in-forms are available online for deeds such as Quit Claim Deeds, Warranty Deeds, Special Warranty Deeds, and others. Sometimes people transfer property (or think they have) using these do-it-yourself online deeds thinking they are transferring ownership to someone. This does not always work the way people hope. And sometimes, the problems are not discovered for years.
How do you know if the deed you did will work? You may be long gone by that time. People tell me they are confident because the County Recorder “accepted” the deed and recorded it. The County Recorder will record anything – it does not have to be accurate, correct, or effective. I remember a law professor who liked to say, “The County Recorder will record a ham sandwich if their fee is paid.”
Sometimes people tell me they did the deed correctly because the County Assessor reflected the new owner in their records. But the County Assessor gets their information from the Recorder and follows whatever is recorded, whether it is correct or not.
I recently had a case come to me with an old problem. A mother transferred a deed to her three sons as joint tenants with right of survivorship in 1976. Two of the sons were married at the time of the transfer. Over the years, the two married brothers died and each time the survivors recorded the proper paperwork to put the title into the name of the survivors. Eventually, the house title appeared to be in the name of the last surviving brother (We will call him Joe). In 2021, 45 years after the original transfer to the three brothers, Joe signed a deed transferring the property to an individual (we will call her Susan) in a private cash sale. No need to involve a title company, they thought, or to get title insurance. The County Recorder recorded the deed and the assessor showed the property titled to Sue.
Sue took possession of the property and began renovating it. Several months after her “purchase” she decided to take out a loan and the lender, of course, required title insurance. The title company would not insure the property because in Arizona, a community property state, spouses need to sign off on such transactions in most cases. Here, the two dead brothers who were married at the time they received the deed from Mom did not include disclaimer deeds from their wives. The title company will not issue the insurance until those wives, or their descendants, sign off on the property transferred 45 years ago. Good luck. First, they need to be found and then they need to agree to sign. They could demand money in exchange for clearing the cloud from this title. This problem will cost Sue several thousands in legal fees to fix.
I see problems like this quite often. It is almost always a property that has been kept in a family for a long time. When someone gets ready to transfer property to a person and title insurance is needed, as it always is when a mortgage is involved, these problems pop up and can be very expensive to fix. It is a good idea to get legal advice each time a change is made on a title, even among family members.
