Why Using an Online Deed Template for Estate Planning Purposes is a Bad Idea

Online legal forms, including deed templates, are easily available and can be tempting to use when transferring a property to a family member. This may seem like an easy and inexpensive solution, but it often leads to unexpected problems, which may not arise until a bank, lender, or title company reviews the deed. In Maryland, improperly drafted or recorded deeds can often cause transactions to stall or refinancing to be denied.

One of the main problems is that online deed forms are written with generic language that does not reflect Maryland’s deed statues, tax requirements, or recording practices. Not only that, but some counties in Maryland (Montgomery County, for instance) require county-specific language and local tax exemptions.

Deeds are also scrutinized by banks for a clear chain of title. The use of an online deed template may raise questions about ownership, enforceability, or compliance with Maryland law. Banks are in the business of risk assessment and are more likely to take issue with a DIY deed than one prepared by an experienced real estate attorney. Filing a generic “quit claim” deed in Maryland is typically the incorrect deed to file and doing so can create significant title problems. While such deeds are acceptable in many other states, they present a unique problem under Maryland law and you should have a consultation with an attorney before deciding to file such a deed as it is, in most instances, the incorrect deed to execute when transferring title in Maryland.

Another common issue involves tax consequences and exemptions. A Maryland deed must correctly identify whether transfer and recordation taxes apply, or whether a statutory exemption is being claimed. Online forms often misapply exemptions or fail to cite the correct statute. In addition, county specific affidavits and supporting documents are often required in order to claim tax exemptions.

If you are considering transferring ownership of a home as part of your estate or to avoid probate, working with an experienced real estate or estate planning attorney will ensure that the deed transfer will be done correctly and thus honored by banks, insurers, and courts.

For a free, confidential conversation to discuss property title transfers, contact Maryland real estate attorney Stephen J. Reichert at 410-299-4959 or sreichert@reichertlegal.com. #MarylandAttorney #MarylandLawyer #MDAttorney #MDLawyer #MarylandDeed #MarylandTitle #MarylandPropertyLaw #MarylandTitleAttorney #MarylandTitleLawyer #LifeEstate #MDPropertyDeed #StephenJReichert #ReichertLegal