When gifting property to an heir or relative, what is a simple or quick method of initiating the transaction? In real estate, there aren’t too many simple or quick things. There is a lot of paperwork and even various parties involved in completing specific transactions, and all of this can vary from state to state.
A relinquishment letter is a vehicle for transferring ownership of a property. But it isn’t as straightforward as just writing a letter. Let’s see what’s involved.
What Is a Relinquishment Letter?
A relinquishment letter is a transfer or giving up of rights to another person. It signifies that one person fully transfers property to another person.
The relinquishment letter may sound like a quitclaim deed, but it isn’t. A quitclaim deed transfers an owner’s interest in a property. One problem with quitclaim deeds for the transfer recipient is that they do not provide protection. The deed is just a transfer claim.
The quitclaim deed doesn’t check if there are liens on the property or other issues. The transferee will still need to ensure the property is “clean” and the transfer is fully valid.
How to Write a Relinquishment Letter
Unfortunately, there isn’t a standard relinquishment letter format across all states. You should also not write it alone. Instead, you’ll want a real estate attorney to help you draft it.
Like a quitclaim deed, a relinquishment letter doesn’t protect the transferee. It’s still necessary to ensure that there are no liens, the title is clear, and the transferer has the right to transfer the property. That’s why working with an attorney is important.
Relinquishment letters are uncommon in real estate. If you search for relinquishment letter, you’ll pull up lots of results referencing Indian properties, meaning the country of India. Apparently, relinquishment letters are popular in India.
Searching for a real estate relinquishment letter template for a specific state won’t yield any results. As mentioned above, states don’t standardize these letters. They are written from scratch. That’s why it is advisable to seek out an experienced real estate attorney if you are considering a relinquishment letter and to determine if it is even necessary for your situation.
This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. All real estate investments have the potential to lose value during the life of the investment. All financed real estate investments have the potential for foreclosure. Realized does not provide tax or legal advice. This material is not a substitute for seeking the advice of a qualified professional for your individual situation. Examples shown are hypothetical and for illustrative purposes only.
