Q: If a deed of trust has 3 people on it and it is being transferred to one person on the deed, does the transfer tax apply
I am in the process of assuming my mortgage and will have the deed updated as well. Myself, my ex-husband and brother are on the deed. The deed will be transferred to only myself. I just want to make sure I'm reading the exemptions to the transfer tax correctly, stating that the tax doesn't apply to transfers between spouses and relatives.
A: Unfortunately the answer is very locale and fact specific.
There are 3 different taxes that come into play with a deed. Transfers to/from a spouse, where property is encumbered by a mortgage, are exempt from both state & county transfer/recordation tax. Transfers to/from a sibling are GENERALLY tax exempt, at least from state tax, but in some locales (counties) the clerks may try to impose a county transfer tax based on the value of the assumed mortgage. In other counties, the portion going to a sibling is exempt from all 3 taxes. If the person assuming the mortgage already had some obligation under it, they should at worst case be subject to a partial county tax.
The attorney assisting you with your deed should be able to easily answer the question, though, based on the location of the property.
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