A North Carolina quitclaim deed allows for the transfer of property from one person to the next without any warranty about the quality of the title. It transfers whatever ownership and interest the grantor (seller/owner) has in a property to the grantee (buyer/new owner). A North Carolina quitclaim deed offers no title warranty, meaning title problems could exist.
How to File
Filing a quitclaim deed in North Carolina is straightforward when you know the rules. Correctly preparing and recording the deed ensures the property transfer goes smoothly.
Step 1 – Gather All Needed Information and Documentation
Before you start preparing your quitclaim deed or getting ready to file, make sure you have all the information you need in hand.
Look up the current title to the property, which will include critical information like the current owner of the property and the property’s legal description. With that documentation in front of you, it is much easier to fill out the content of your quitclaim deed.
Step 2 – Fill Out Your Quitclaim Deed Form
Make sure that your quitclaim deed form contains all relevant content, from the name of both the grantor and the grantee to the legal description of the property. While you should make sure that you fill out all information required by the form, you should not sign it until you are in the presence of a notary.
Step 3 – Get the Form Notarized
N.C. Stat § 47-38 requires you to have the grantor’s signature on your quitclaim deed validated by a notary. The grantor will need to show proof of identity, usually in the form of a government-issued ID.
Step 4 – Take the Form to the Register of Deeds Office
According to N.C. Stat. § 47H-2, you should file your quitclaim deed with the register of deeds office in the county where the property is located. Be prepared to pay recording fees, including a $26 fee for a standard instrument that is not a deed of trust or mortgage, when you submit your deed.
You also will be asked for the address where the deed should be sent once it has been properly filed. However, you may want to make any relevant copies of the deed before you turn it in to make certain that both the grantor and the grantee have extra copies if needed.
Costs and Fees
When you file a quitclaim deed in North Carolina, you’ll typically face recording fees and taxes. Planning ahead for these expenses can save you time and prevent delays.
Filing Fees
Filing fees are the direct fees associated with submitting a document in North Carolina and are paid when you take your quitclaim deed to the register of deeds office. North Carolina fees for recording real estate instruments can vary depending on the type of document.
While deeds of trust and mortgages cost $64 for the first 35 pages and $4 for each page after that, instruments other than deeds of trust and mortgages, including quitclaim deeds, typically cost $26 for the first 15 pages. Because quitclaim deeds are usually short documents, most parties will not face the additional $4 fee for extra pages.
Taxes
The taxes associated with a real estate transfer can be significant, even in cases in which property is transferred as a gift. Both grantor and grantee can face tax implications from a property transfer, which should be planned for ahead of time.
Real Estate Transfer Tax
North Carolina assigns a real estate transfer tax of $1 per $500 of property value, as laid out in N.C. Stat § 105-228.30.
Who Pays the Transfer Tax?
The transfer tax is paid by the grantor, or the current owner of the property.
Exemptions to the Transfer Tax
N.C. Stat. § 105-228.29 lays out several exemptions to the real estate transfer tax, including:
- Transfers due to the terms of a will
- Gifts
- When no consideration in property or money is paid for the property
- When the property is used to secure a debt
If you believe that your quitclaim deed should not face transfer taxes under these terms, consult with an accountant or tax professional to make sure that you fully understand your legal obligations.
US Gift Tax
The United States gift tax applies to high-value gifts between individuals. The IRs does provide some exemptions for gifts between family members up to a set amount each year. However, because of the high monetary value of real estate, many of those transactions will fall under gift tax requirements. Consult an accountant to make sure that you understand your responsibilities when it comes to paying a gift tax.
North Carolina does not assess a separate gift tax.
Capital Gains Tax
The capital gains tax is levied on the amount a property’s value increases between the time you buy it and the time you sell it.
Real estate often appreciates substantially in value, which means that depending on how long you held the property and its value when sold, you can face considerable capital gains taxes upon the sale. However, the IRS does provide some exceptions for properties that have been the grantor’s primary residence, which means that they lived in the property for at least two of the last five years.
North Carolina taxes capital gains as regular income, which means that if you see considerable gains from the sale of a property, you can expect to face tax implications for that purchase. Consult an accountant to make sure that you fully understand your tax obligations.
North Carolina Quitclaim Deed Requirements
To transfer property successfully using a quitclaim deed in North Carolina, you’ll need to meet several legal standards. Knowing what to include upfront will help your transaction go smoothly.
Legal Framework
N.C. Stat. § 47 covers the details of North Carolina quitclaim deed requirements and those of other types of deeds.
Signing Requirements
According to N.C. Stat § 47-38, a notary must acknowledge the grantor’s signature in order for the quitclaim deed to be valid.
Recording Requirements
N.C. Stat. § 47H-2 requires quitclaim deeds to be recorded with the register of deeds in the county where the property is located.
Validity Requirements
In order to be considered valid, a quitclaim deed in North Carolina must meet specific standards. First and foremost, it must note that the deed transfers the title but does not include any warranty on the title. Any mention of a warranty, general warranty, or special warranty should be avoided in creating a quitclaim deed. Furthermore, it should meet the formatting standards laid out in N.C. Stat § 161-14, including:
- Standard size or legal size paper (8 1/2 x 11 inches or 8 1/2 x 14 inches)
- Black ink only, with printing on one side of the page
- Handwritten text completed in pen
- Fonts no smaller than nine points, with many counties preferring 10-point font or better
- A 3″ margin on the top of the first page
- 1/2″ margins on the rest of the page or pages
- A clear title that identifies the document as a quitclaim deed
By following North Carolina quitclaim deed requirements, which can be managed easily by using a quitclaim deed template specifically for the state, both grantor and grantee can feel confident that the property transfer will go through correctly and that the recorder of deeds will accept the document.
Content Requirements
A North Carolina quitclaim deed must contain essential information about the property and both the grantor and the grantee, including:
- The name and address of the grantor (the original owner of the property)
- The name and address of the grantee (the new owner of the property)
- The legal description of the property, which includes not only its address but also the boundaries and other information laid out in the title
- The name of the party that prepared the deed
- A statement about whether the property is the grantor’s primary residence
Locating all of that information, including reviewing the legal description in the current title for the property, before filling out a quitclaim deed can help the process go more smoothly.
Quitclaim Deeds vs. Other Property Transfer Methods in North Carolina
The primary difference between a quitclaim deed transfer and other property transfer methods is the quitclaim deed’s lack of warranty. A warranty on a property protects the new owner against outstanding liens or property taxes, boundary disputes, and errors in deeds or title transfers earlier in the property’s ownership.
Before initiating a property transfer, including a property transferred as a gift, both grantor and grantee should carefully consider the available deed options and how they want to proceed.
| Quitclaim Deed | Quickly transfers property without warranties, used for adding spouses to titles post-marriage, dividing assets post-divorce, correcting title errors, or moving property among family or related companies. Grantees assume all risks, including title issues and back taxes. |
| Special Warranty Deed | A property transfer method offering limited warranty, covering only the period during the current owner's possession. It is used in situations like foreclosures or bank sales, providing a faster transfer than general warranty deeds. This method conveys some protection to the grantee but does not cover issues predating the current owner's possession, splitting responsibility for any pre-existing title issues between the grantor and grantee. |
| Life Estate Deed | Allows owners to use their property for life and automatically transfers it to a grantee upon their death, avoiding probate. Irrevocable without the grantee's consent, it restricts the owner's ability to sell or change the property but ensures its eventual transfer while limiting the grantee's control during the owner's life. |
| Ladybird Deed | This arrangement lets the current owner keep their rights to the property, including the option to sell, while ensuring it passes to the grantee upon the owner's death, bypassing probate. The owner retains full control over the property during their lifetime, streamlining inheritance. However, it doesn't guarantee the grantee possession, as the owner may sell or transfer the property at any time. |
| Survivorship Deed | This setup establishes a right of survivorship, where if one co-owner dies, ownership automatically transfers to the surviving co-owner, bypassing probate. It safeguards co-owned property and streamlines asset transfer after death. However, it's specific to co-ownership situations and does not permit joint tenants to hold unequal shares in the property. |
Sample North Carolina Quitclaim Deed
Below, you can view a free sample North Carolina quitclaim deed. Edit it with your information and download a completed version in PDF or Word format.
Frequently Asked Questions
How does a quitclaim deed affect property rights in North Carolina?
A quitclaim deed transfers any interest the grantor has in the property to the grantee without warranties or guarantees about the title’s quality. In North Carolina, this means the grantee receives the property “as is,” potentially including any title defects or legal encumbrances that exist at the time of transfer.
The grantee is not protected against any claims from third parties or issues with the title that may arise after the deed is executed. Therefore, it’s crucial to perform due diligence and consider a title search before accepting a quitclaim deed transfer.
Can a quitclaim deed transfer property to a family member in North Carolina?
Yes, in North Carolina, a quitclaim deed can be used to transfer property ownership between family members. This is often done to gift property or settle matters in a divorce or estate planning.
However, it’s essential to understand that the quitclaim deed does not guarantee the grantor owns the property free and clear of liens or encumbrances. Therefore, a title search is recommended even in transactions among family members to ensure a clear understanding of the property’s title status.
Do I need a lawyer to execute a quitclaim deed in North Carolina?
While North Carolina law does not require you to have a lawyer to execute a quitclaim deed, it is highly recommended to consult one. A lawyer can ensure that the deed complies with North Carolina law, accurately reflects the parties’ intentions, and properly transfers the property.
They can also advise on potential tax implications and help conduct a title search to uncover any issues with the property’s title. Engaging a lawyer can help prevent future disputes and ensure a smooth property transfer process.
What happens to a mortgage when a property is transferred via quitclaim deed in North Carolina?
In North Carolina, a quitclaim deed transfers the grantor’s interest in the property to the grantee without affecting any existing mortgages or liens. If the property has a mortgage, the original borrower (grantor) remains responsible for the mortgage debt unless the lender agrees to transfer the debt to the grantee or release the grantor from liability.
It’s crucial for both parties to understand that a quitclaim deed does not change the responsibility for the mortgage, and both should consult with the mortgage lender to discuss the implications of the transfer on the mortgage obligation.
