What is the difference between a quitclaim deed and a statutory warranty deed? Let’s take a look at what the law says about these two types of deeds. 

RCW 64.04.050

Quitclaim deed—Form and effect.

Quitclaim deeds may be in substance in the following form:

The grantor (here insert the name or names and place of residence), for and in consideration of (here insert consideration) conveys and quitclaims to (here insert grantee’s name or names) all interest in the following described real estate (here insert description), situated in the county of . . . . . ., state of Washington. Dated this . . . . day of . . . . . ., (year) . . . .

Every deed in substance in the above form, when otherwise duly executed, shall be deemed and held a good and sufficient conveyance, release and quitclaim to the grantee, his or her heirs and assigns in fee of all the then existing legal and equitable rights of the grantor in the premises therein described, but shall not extend to the after acquired title unless words are added expressing such intention.

RCW 64.04.030

Warranty deed—Form and effect.

Warranty deeds for the conveyance of land may be substantially in the following form, without express covenants:
 
The grantor (here insert the name or names and place or residence) for and in consideration of (here insert consideration) in hand paid, conveys and warrants to (here insert the grantee’s name or names) the following described real estate (here insert description), situated in the county of . . . . . ., state of Washington. Dated this . . . . day of . . . . . ., (year) . . . .
 
Every deed in substance in the above form, when otherwise duly executed, shall be deemed and held a conveyance in fee simple to the grantee, his or her heirs and assigns, with covenants on the part of the grantor: (1) That at the time of the making and delivery of such deed he or she was lawfully seized of an indefeasible estate in fee simple, in and to the premises therein described, and had good right and full power to convey the same; (2) that the same were then free from all encumbrances; and (3) that he or she warrants to the grantee, his or her heirs and assigns, the quiet and peaceable possession of such premises, and will defend the title thereto against all persons who may lawfully claim the same, and such covenants shall be obligatory upon any grantor, his or her heirs and personal representatives, as fully and with like effect as if written at full length in such deed.
 
In a quitclaim deed you are making no assurance to the grantee that you actually own or have any interest in the property. You are merely giving up whatever right you may have in the property or whatever right that others, including title companies and mortgage companies, might think you have. For example, if a wife owns a property in her name only and wants to refinance it, the mortgage company and title company may ask the husband either to sign a quitclaim deed or to sign as a co-mortgagor on the new mortgage.
 
The title companies in Washington typically will not require the husband to sign a quitclaim deed if the husband has never lived in the property, for example, if the property is a rental. On the other hand, if the husband has lived in the home, he will generally be asked either to quitclaim off the title or sign the mortgage.
 
Another alternative is to sign a community / separate property agreement. 
 

Agreements as to status.

Nothing contained in any of the provisions of *this chapter or in any law of this state, shall prevent both spouses or both domestic partners from jointly entering into any agreement concerning the status or disposition of the whole or any portion of the community property, then owned by them or afterwards to be acquired, to take effect upon the death of either. But such agreement may be made at any time by both spouses or both domestic partners by the execution of an instrument in writing under their hands and seals, and to be witnessed, acknowledged and certified in the same manner as deeds to real estate are required to be, under the laws of the state, and the same may at any time thereafter be altered or amended in the same manner. Such agreement shall not derogate from the right of creditors; nor be construed to curtail the powers of the superior court to set aside or cancel such agreement for fraud or under some other recognized head of equity jurisdiction, at the suit of either party; nor prevent the application of laws governing the community property and inheritance rights of slayers or abusers under chapter 11.84 RCW.
 
Note what the quitclaim statute says that the quitclaim deed “shall not extend to the after acquired title unless words are added expressing such intention.” Sometimes documents are recorded out of order. The mortgage the wife is giving to the mortgage company might get recorded first, followed by the husband’s quitclaim deed. The quitclaim deed will not work because it was recorded after the mortgage. If the mortgage companies tries to foreclose against the wife for failure to pay, the mortgage company will fail because the husband never signed on the mortgage and never successfully quitclaimed title. The solution is that the following words must be added to the quitclaim deed: “including after-acquired title”.
 
With the statutory warranty deed, the husband warrants that he is on title. I encourage families to utilize a statutory warranty deed so that they can pass along whatever warranties they got from the person who sold the property to them. A quitclaim deed will transfer bare title, but it will not pass along warranties from the predecessor. Generally there is no new title policy purchased when the husband signs the quitclaim deed, so there is no title company to look to if a defect in title shows up. So always use a statutory warranty deed in these circumstances.
 
With a statutory warranty deed, you will want to include exceptions, items regarding which you are not guaranteeing title, such as easements, covenants, and restrictions or mortgages that are to remain on title.
 
Another issue that comes up is whether excise tax is owing on the transfer. Between husband and wife, there is no excise tax owing, regardless of how much the grantor owes on the mortgage, except for a flat $10 fee. If the grantor is a parent deeding to a child, and if there is a mortgage owing against the property, there may be excise tax owing to the extent of the debt. If there is no debt against the property, there will be no excise tax owing except for the flat $10 fee. There is no excise tax on gifts, but if the grantee is taking subject to debt, the grantee is presumed to be relieving or partially relieving the grantor from the debt.
 
The excise tax exemptions that might apply to help the parent and child avoid the excise tax are 1) that the property is free of debt, 2) that the grantor has been making all the mortgage payments and will continue to do so, or 3) that the grantee has been making all the mortgage payments and will continue to do so.
 
If there is $200,000 owing on the debt, and if the grantee will hold title jointly it is presumed that the grantor and grantee will be equal owners of the property and equally liable on the debt. In that case there will be excise tax owing on the $100,000 half interest. If the parent is transferring the entire interest to the child, then excise tax will be owing on $200,000.
 
The amount of the excise tax is 1.1% up to $500,000. Above $500,000 the percentage rises.
 
You may read the excise tax regulations at this link: 
 
 
 

Sincerely,

James Robert Deal
Real Estate Attorney
Real Estate Managing Broker
Reverse Mortgage Attorney
JamesDeal@JamesDeal.com
PO Box 2276 Lynnwood WA 98036
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