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Don’t accept quit claim deed without title insurance

January 3, 2012
By BOB JEFFRIES , Cape Coral Daily Breeze

Question: My wife and I are getting a "friendly divorce." The worst part is dividing up our real estate equally. To balance everything out, she has agreed to deed to me a house she owns in her name alone from an inheritance. But her attorney will let her sign a quit claim deed. I know you don't like quit claim deeds from a past column, but would I be safe if I also got an owner's title insurance policy (also mentioned in your column) on this free and clear house?

Answer: Yes. A quit claim conveys only what title the grantor owns but without any warranties or representations. It can be fee simple absolute title. Or, it can be no title at all.

For example, if I give you a quit claim deed to the Birchwood Realty Building in Cape Coral, you will receive nothing because I don't own that building. However, if you get an owner's title insurance policy on my quit claim deed, when you discover I defrauded you, then you have a loss claim against your title insurer.

Accepting a quit claim from your ex-wife is fine if you also get an owner's insurance policy on that deed. Without title insurance, do not accept a quit claim deed.

Question: Our condominium association just recently learned that an owner who was delinquent filed bankruptcy. We had a lien against the property when it went into foreclosure. We were informed he filed bankruptcy.

Where does this leave the association? The residents are against paying this owner's debts. Why should that person live for free while we pay our bills on time?

Answer: Bankruptcy is an extreme problem for associations because of the extended delays that can result in solving the nonpayment situation.

I strongly suggest that you have your attorney reply to the notice with instructions to include the association as one of the creditors. Because there are several types of bankruptcy, your attorney should guide the board in the proper actions.

To prevent or reduce similar situations, the board should approve a strong collection policy. Yes, the other owners must pay the bankruptcy's share of the collections as well as the legal fees. It could be charged off to bad debt. I call it the cost of doing business.

Question: Bob, I listed my house March of this year, 2011. My agent promised, at the price we agreed on, there would be many showings. My agent has scheduled a REPEAT showing of my house. Do you think he is just doing this to fulfill his promise? Should I treat this differently from the/an initial showing?

- Karen P.

Answer: Karen, I typed this letter exactly as you wrote it. I hope it comes out right?

Repeat showings are a serious business. They are usually arranged for very interested prospects. Repeat showings usually precede an offer, but they are long.

The buyers often tour around the house several times, re-entering rooms and envisioning the placement of their furniture. They're apt to measure windows, test plumbing and poke into all sorts of corners.

It's best that you stay in one room and do not follow. Better yet, leave the house, if possible, for a repeat showing.

To address the reasons (if any) of promised showings, I can't do - sorry!

I hope everyone enjoyed your holiday and found what you asked for, be you parents or children.

Have a real estate question? Write, call, fax or e-mail:

Bob Jeffries, Realtor

Century 21 Birchwood Realty Inc.

4040 Del Prado Blvd.

Cape Coral, FL 33904

239-540-6659 Office

239-542-7760 Fax


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