My financial advisor told me I should set up a trust and use a 'quitclaim' deed to convey some property I own to the trust (the property is in Massachusetts). What is a quitclaim deed and why are they used? (Posted by Ginger on The Forum.)
Editor's Response:
First, I am sure your financial advisor intended that you should talk to an attorney about the trust and that the attorney would advise you about how to transfer ownership of the property into the trust.
In any case, In Massachusetts as in other states, if a grantor (seller) gives a Quitclaim Deed, he or she conveys all of the legal and equitable rights she has in the property at the time of the conveyance. However, the grantor makes none of the warranties usually found in the more common Warranty Deed. In a typical closing with a property financed by a lender, all parties will insist that the grantor provide a Warranty Deed in which he warrants, among other things, that he is the lawful owner of the property and that the property is free from all encumbrances and liens. Quitclaim Deeds are used in situations where these warranties are not needed, such as--in your situation--when an owner conveys his interest in a property to a trust, corporation, or other entity he has created.