Michigan Requirements for Quitclaim Deeds

Michigan Requirements for Quitclaim Deeds

by Ronna L. DeLoe, Esq., August 2018

There are several types of deeds allowed under Michigan law. Quitclaim deeds are the easiest and least expensive deeds to use for transferring property because you don't need to conduct a title search. As the grantor, or person who transfers the property, a quitclaim deed allows you to transfer the deed to the grantee, or person who receives the property, although the document does not guarantee you have valid title. Quitclaim deeds transfer only the part of the property the grantor actually owns, so if the grantor owns one-fourth of the property, that's all he can transfer to the grantee.

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If you're the grantee, be mindful that quitclaim deeds can be risky if you don't know or trust the grantor or know the property's history. Immediate family members often use quitclaim deeds because there's a level of trust between the parties. Other types of deeds offer more protection for the grantee, such as a warranty deed, which guarantees that the title is good and that the property doesn't have liens, easements, or other issues.

How to Fill Out a Quitclaim Deed in Michigan

Michigan uses quitclaim deed Form 863, which is different in each county, so make sure to get the form at the office or website of the County Register of Deeds in the county where the property is located. Although there are other quitclaim deed forms that don't contain a number, all acceptable forms contain language that the grantor quitclaims, or relinquishes, the property. Each county's form requires the same basic information, including the names and addresses of the grantee and grantor, the property description (which you can get from a prior deed to the property or from the County Register of Deeds Office), and the amount of money being exchanged for the property.

Make sure you describe the property exactly as it is on prior deeds. In order to comply with contract law, you must include the amount of money being exchanged, even if it's only one dollar, which is usually the amount paid when property is being given to a close family member or friend.

Sign and date the quitclaim deed in a notary's presence, then file it with the County Register of Deeds Office in the property's county, not the county where you live. Once the deed is filed and recorded, the transfer is deemed legal. If you're not sure how to fill out a quitclaim deed, you can use an online service provider to prepare it for you.

Quitclaim Deed Transfer Tax in Michigan

Before the grantor or grantee records the deed, the grantor must pay transfer taxes in Michigan. Transfer taxes include those imposed by both the state and the county in which the property is located. If the County Register of Deeds Office allows you to file the deed, this shows that the grantor paid all transfer taxes or that the transfer is exempt from taxes.

There are many exemptions in Michigan, including an exemption where the money being exchanged in the deed is less than $100. For example, there are no taxes imposed on transfers from one spouse to the other or from a parent to a biological child, stepchild, or adopted child. Because the County Register's Office cannot give you legal advice, you may want to speak with an attorney or financial adviser to find out if you can claim any exemptions.

Statute of Limitations on a Quitclaim Deed in Michigan

If you're the grantee or grantor of a quitclaim deed, you have a limited amount of time to bring a lawsuit against the other party if there are any issues. Many states allow only two years for this challenge, after which you lose the right to sue.

Michigan has several statutes that permit challenging a quitclaim deed. For example, challenging a quitclaim deed given by a close family member or a court-ordered sale has a five-year statute of limitations. The statute for bringing a lawsuit based on fraud or on a contract in Michigan is six years. However, if two people claim title to the same property, the statute of limitations is fifteen years. Check with an attorney for the limitation period if you want to sue the grantor or grantee of the deed.

Quitclaim Deed in Michigan as a Result of Divorce

It is common to use a quitclaim deed in a divorce when one spouse gives the property to the other. The reason for using a quitclaim deed in this situation is that both spouses know the history of the property and know they have good title to it. A quitclaim deed transfers the entire property to the other spouse while removing the grantor's name from the deed.

Other Types of Deeds in Michigan

Quitclaim deeds in Michigan can give the grantee different types of rights. A quitclaim deed can include full rights of survivorship if the grantor gives the deed to another person as a joint tenant. The quitclaim deed should state that the grantor conveys, or transfers, the property as a “joint tenancy with full rights of survivorship." Joint tenants equally own the property by quitclaim deed. Full rights of survivorship means that if one person passes away, the property passes to the survivor without the need to go to probate court.

Another type of deed, known as a life estate or Lady Bird deed, allows the grantor to enjoy the property during his lifetime, with the property passing to the grantee upon the grantor's death. Only a few states, including Michigan, recognize Lady Bird deeds.

If you're using a quitclaim deed, follow the above steps to record the deed and make sure you claim a tax exemption if you're entitled to it. Despite the risks that sometimes come with using a quitclaim deed, it remains one of the most often-used deeds in Michigan because of its simplicity and affordability.