50% Quit claim of property In California, is it legally possible for me to…

50% Quit claim of property
In California, is it legally possible for me to quit-claim 50% of my deed to a single-family home to another person, while I remain 100% responsible for the mortgage?

Or would my lender require that this person gets added to the mortgage note along with me?

2 thoughts on “50% Quit claim of property In California, is it legally possible for me to…

  1. Re: 50% Quit claim of property
    It’s technically possible to do this, but whether doing so would create legal problems is another matter. Many loans, perhaps most, contain so-called “due on sale” clauses that theoretically at least cause the entire loan balance to become due immediately if the owner-borrower ceases to hold title for any reason. (These clauses do not apply, however, to transfers to living trusts and certain transfers arising out of divorce settlements.)

    Many lenders will waive their due-on-sale clauses upon request where good reasons are given, or for a small fee. Perhaps you will need to consider refinancing with a new lender who will agree to the split ownership, with or without the new co-owner being liable.

    I should point out that problems with the lender are not the only legal problems associated with making a gift of an interest in real property. There are property tax, gift tax and capital-gains tax issues to consider, most with costly consequences in most situations. Your co-owner will share the right of possession with you, unless you have a written agreement providing otherwise. Unwinding co-ownerships often lands in court and can be expensive. There is the question of whether title will be held as joint tenants or tenants in common, each with longer-term inheritance and ownership consequences.

    If the purpose of co-ownership is probate avoidance, consider a living trust as an alternative; it avoids probate and also avoids tax expenses for most familiies.

    Bryan Whipple
    Bryan R. R. Whipple, Attorney at Law
    P O Box 318
    Tomales, CA 94971-0318

  2. Re: 50% Quit claim of property
    Possible? Yes. There is nothing you can do to reduce that 100% liability on the mortgage unless the lender adds someone to it.

    Terry A. Nelson
    Nelson & Lawless
    18685 Main St., #175
    Huntington Beach, CA 92648

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