The ability to transfer title of real estate, in whole or in part, is a fundamental right of property ownership. If you own a house, building, or land, it’s yours to share however you see fit. Unfortunately, when you have a mortgage you may limit your ability to transfer the property. The lender who has the mortgage on your house also has an interest in the property and many mortgages either prohibit property transfers or require payment in full in exchange. However, in some cases, you can still add a person to the deed, even if you have a mortgage, without burdening that person with the mortgage.
If your mortgage allows you to add an individual to your title, you can do so by creating and signing a quit claim deed which lists the new co-owner of the property. Carefully review your promissory note and mortgage or deed of trust. These are the legal documents that govern your loan and let you know what your actual rights are. Most loans provide that in the event of default, the loan can be accelerated; that is, the entire loan balance immediately becomes due. The documents will also provide a list of things that constitute an “event of default”, such as non-payment of monthly mortgage obligation, failure to pay property taxes, and transfer of any part of the property without the lender’s permission.
If your mortgage documents do not contain a prohibition on transferring the property without the lender’s consent, you can simply transfer title by quit claim deed. However, if such a prohibition does exist, you must contact the lender. Make all your contact with the lender in writing and specify that you want to add someone to the deed of your property but not the mortgage. If the lender grants permission, ask it to confirm its consent in writing, as all modifications to any contract generally must be in writing and signed by the parties to be enforceable. If the lender approves the transfer you can proceed with your deed.
If your lender approves the transfer you can create, sign, and record a quit claim deed granting an interest in the property to the person with whom you want to co-own the property. After you both sign the deed you must record the deed with the county in which the real estate is located. Recording the deed makes the ownership a matter of public record and protects the people on the deed from having their interests taken away from them.
