If you’ve read Parts I and II of, “Which One Do I Choose,” you may have decided whether a quitclaim or warranty deed is best for you. Now it’s time to decide which deed to use based on ownership of the property.
How will the property be owned?
The person(s) buying or receiving title to the property is called the grantee. To select a Colorado deed, you need to know how the grantee(s) will own the property after it is bought or acquired. Different forms are used depending on whether the grantee will be an individual, tenant in common, or joint tenant.
What are the different ways to own real property? And why does the deed matter when you die?
In Colorado, a person can own property in one of three ways:
• Individual. One person owns the property. As the sole owner, you can list your property in your will. If there is no will, your property will be distributed according to the probate laws of Colorado when you die.
• Joint tenants (with right of survivorship). This type of ownership can exist between two or more people. This is most common between a husband and wife, but could be multiple owners, like three sisters, or perhaps five friends who own a cabin together. If one owner dies, the other owners listed on the deed automatically inherit the share of the person who died.
• Tenants in common. This type of ownership can exist between any two or more people, including a husband and wife. With this type of ownership, the co-owners have no claim to each other’s interest in the property and each owner is separately responsible for his or her share of the property. If Mary, Kate and Shannon own a house as tenants in common, and Mary dies, Mary’s one-third ownership of the house would go to Mary’s heirs or to whomever Mary gives it to in her will, not to Kate and Shannon.
If the property is part of an estate or owned by a company or corporation, stay tuned for Bradford’s blog on “Deeds for Special Situations.”
For more information about quitclaim deeds and warranty deeds, check out Bradford Publishing’s guide, “Understanding Colorado Quitclaim and Warranty Deeds.”