Transferring property ownership in New York is a process that involves several legal steps. Whether you are gifting property to a loved one, selling real estate, or transferring it as part of an inheritance, it is important to understand the procedures and requirements involved. Property transfers can sometimes be confusing, especially when dealing with legal documents and different types of ownership structures. By following the correct steps, you can ensure that the property is legally transferred without issues in the future.
Richard H. Cole
Partner
Thomas F. Hewner
Partner
Donna L. Haslinger
Partner
Vivian P. Roche'
Partner
Keith R. Rosso
Attorney
Tasha D. Frazie
Attorney
When transferring property ownership, the first thing you need to know is that you must have a clear understanding of the type of property ownership that is being transferred. In New York, there are different kinds of property ownership such as joint tenancy, tenancy in common, and sole ownership. Each of these ownership types has its own rules and affects how the property transfer is handled. For example, if the property is jointly owned, all co-owners must agree to the transfer, while sole ownership means only one person controls the decision to transfer the property. Knowing the type of ownership will help you take the next steps in the process. At, Cole, Sorrentino, Hurley, Hewner & Gambino, P.C., we are here to guide you through the legal process and help you navigate the complexities of your case.
Preparing the Deed
The deed is the most important document in any property transfer. This legal document must accurately describe the property being transferred and identify the parties involved in the transaction. In New York, the deed must be prepared in writing and signed by the person transferring the property, also known as the grantor. The deed must clearly state who is receiving the property, known as the grantee, and it should include all necessary details about the property, such as its location and any important boundaries.
There are several types of deeds used in New York property transfers. The most common are the warranty deed and the quitclaim deed. A warranty deed guarantees that the grantor owns the property free of any claims, liens, or other issues, while a quitclaim deed simply transfers the grantor’s interest in the property without any guarantees about ownership or liens. It is crucial to choose the correct type of deed for your property transfer, as this can affect the legal rights of both the grantor and the grantee.
Once the deed has been prepared, it must be signed in front of a notary public. A notary public is a person authorized by the state to witness the signing of important documents. The notary will verify the identity of the grantor and make sure that the deed is properly executed. Having the deed notarized ensures that the document will be accepted when it is filed with the county clerk’s office.
Filing the Deed with the County Clerk
After the deed has been properly signed and notarized, the next step is to file it with the county clerk’s office. In New York, property transfers must be recorded with the county where the property is located. This step is important because it provides public notice of the property transfer and ensures that the grantee’s ownership is legally recognized.
When filing the deed, you will need to pay a filing fee to the county clerk. The amount of this fee can vary depending on the county and the type of property being transferred. Along with the deed, you will also need to submit a transfer tax form. In New York, a real estate transfer tax is imposed on the sale of property. This tax is typically paid by the seller, although in some cases the buyer and seller may agree to split the cost. The transfer tax is calculated based on the sale price of the property or its assessed value in the case of a gift or inheritance.
It is important to make sure that all necessary paperwork is completed accurately and filed on time with the county clerk. Failure to properly file the deed could result in delays or even the cancellation of the property transfer.
Handling Transfer Taxes
New York State requires the payment of transfer taxes when property ownership is transferred. These taxes are imposed on the sale price of the property and must be paid at the time of filing the deed with the county clerk. The current tax rate in New York State is $2 for every $500 of the property’s value. In addition to this, if the property is located in New York City, an additional tax may be required under the city’s Real Property Transfer Tax.
While transfer taxes are usually paid by the seller, there may be instances where the buyer agrees to share or take on the responsibility for paying these taxes. It is important to clarify who will be responsible for paying the transfer taxes before finalizing the property transfer. Ensuring that the correct taxes are paid is crucial to avoid any legal issues or delays in the transfer process.
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Reviewing the Title
Before transferring property ownership, it is essential to review the title of the property. The title is a legal document that shows who owns the property and if there are any legal claims or liens against it. Conducting a title search can help ensure that the property is free of any encumbrances, such as unpaid mortgages or legal judgments, that could affect the transfer.
A title search is often conducted by a title company or attorney, who will review public records to verify the current ownership and any potential issues with the property’s title. If any liens or claims are found, they must be resolved before the property can be transferred. For example, if there is an outstanding mortgage on the property, the grantor may need to pay it off before the transfer can take place. Clearing up any title issues ahead of time will make the transfer process much smoother and help avoid future disputes.
Once the title has been reviewed and cleared, the grantor can proceed with the transfer of ownership.
Finalizing the Transfer
After the deed has been filed, the transfer taxes have been paid, and the title has been reviewed, the property transfer is almost complete. However, there are still a few steps that need to be taken to finalize the transfer.
If the property transfer is part of a sale, the buyer and seller will need to complete the closing process. This is where all remaining paperwork is signed, and any outstanding payments, such as the purchase price and closing costs, are made. The closing process is typically overseen by a real estate attorney or a title company to ensure that everything is completed according to the terms of the sale.
If the property is being transferred as a gift or inheritance, the grantor will need to make sure that any necessary gift tax or estate tax forms are filed with the appropriate tax authorities. While New York does not impose a state gift tax, there may still be federal tax implications, so it is important to consult with a tax professional to ensure compliance with all applicable laws.
Once all of the legal and financial requirements have been met, the property transfer will be complete, and the grantee will become the new legal owner of the property.
Transferring property ownership in New York involves several important legal steps, from preparing the deed to filing it with the county clerk, paying transfer taxes, reviewing the title, and finalizing the transfer. By following these steps carefully, you can ensure that the transfer process goes smoothly and that all legal requirements are met. However, property transfers can be complicated, and even small mistakes can lead to delays or legal disputes down the road. That’s why it is always a good idea to seek legal guidance when transferring property.
If you are planning to transfer property ownership in New York and need assistance navigating the legal steps involved, Cole, Sorrentino, Hurley, Hewner & Gambino, P.C. is here to help. With years of experience in real estate law, we can guide you through the process and ensure that your property transfer is handled smoothly and efficiently. Contact us today to learn how we can assist you with your property transfer needs.