5 Steps for Transferring Real Estate Titles in Kentucky
Once you’ve decided on a new home, it’s only natural to want the paperwork out of the way as fast as possible. The sooner the title transfer is complete, the sooner you’ll get your keys and can start building your new life.
Title transfer legally transfers ownership rights. It’s an extremely important step in the real estate process. The steps must be followed precisely. 64% of Americans own real estate. And yet very few people know how the title process works.
How are titles transferred?
1. Identify the two parties involved
Every title transfer has both a grantor and a grantee. These titles represent a person, business, trust, or other entity. The grantor currently holds the rights to a property. The grantee is the party that receives the rights to property. In layman’s terms, the grantor is the seller and the grantee is the buyer. If properties are owned jointly, these terms can represent more than one person. For example, if three siblings jointly inherit a property from a deceased parent and decide to sell it they would all be referred to as the “grantor” on the property.
2. Identify the type of deed you need
Deeds are legal documents. They identify legal property ownership and are used to transfer ownership from one party to another. There are three different types of deeds:
Warranty Deed—This is the most common type of deed for one main reason: it grants the buyer the most protection. A warranty deed guarantees that the property is clear of liens and encumbrances. It affirms that the seller has the legal right to sell the property.
Special Warranty Deed—This type of deed is commonly used in foreclosure or bank-owned property transactions. It allows the buyer similar peace of mind as the warranty deed. Special warrants guarantee the seller has correctly conveyed the property and has the legal right to sell it. The seller must legally claim that during their tenure, they’ve done nothing that would create a title issue.
Quit Claim Deed—Quit claim deeds are rarely used when money is exchanged. They still transfer ownership from one person to another. Typically they’re used when a property is gifted to someone. Or if you’re simply adding a person to your title.
With quit claim deeds there is no guarantee about the property’s title. Any liens are transferred to the new owner. For this reason, they’re rarely used unless the title is transferred between people who know and trust each other.
3. Write and review the deed
Once you know what deed to use and have identified the parties involved, the deed is ready to be drafted. You’ll need to hire a title company or a real estate attorney for this phase to ensure the documents are accurately drafted. The deed will include:
- Names and addresses of the grantor and grantee
- A detailed description of the property.
After the deed is written all parties will review it for accuracy.
4. Sign the deed
You’ll need to make an appointment with a notary to witness and certify the signing of the deed. This cannot be done with e-signatures. You’ll have to put pen to paper.
5. Register the deed
The final step is to file the deed with your local county clerk. Your local county records office will also require you to pay a tax on the sale. You may hear real estate transfer tax also called “deed tax”, “mortgage registry tax” or “documentary stamp tax”.
Kentucky’s tax is $0.50 for every $500 of the home’s purchase price. So for example, you would pay $300 tax for a $300,000 home.
How long does title transfer take in Kentucky?
Title transfer is one of the elements of the “closing period” that makes it seem to take so long. The average time it takes to transfer a title in Kentucky is 4-6 weeks.
Title Services in Louisville
There must be no mistakes on your new deed. Collier Title offers an array of services and can ensure that your title transfer is perfectly executed. For more information, get in touch!