Alabama Deeds: How to Transfer Alabama Real Estate

Alabama real estate is transferred by a written document called a deed. The process for transferring Alabama real estate by deed involves several steps:

1. Find the most recent deed to the property. This would be the deed that conveys the property to the current You will need the deed so that you have the names of the current owners exactly as they are listed in the deed. You will also need the legal description from the deed to use in creating the new deed. If you do not have the deed, you can usually locate it by contacting the clerk of the county where the property is located.
2. Create the new deed. Our Deed Generator makes it easy to create the new deed. Just complete our step-by-step guided interview and the software will produce a document that matches the choices you made in the interview. Depending on what you decide, the software can generate Alabama quitclaim deeds, Alabama statutory warranty deeds, Alabama general warranty deeds, and life estate deeds. Each of these deed types is discussed
3. Sign and notarize the deed. Once the deed is created, the current owner (and possibly his or her spouse) must sign the deed in front of a notary and have the signatures notarized. The notary acknowledgments should be in the required statutory format, which is used by our Deed Generator.
4. Record the signed, notarized original deed with the Office of the Judge of Probate. Recording fees can vary but usually range from $2.50 to $11.00 for the first page and $2.50 to $3.00 for each additional page. There is also a separate deed tax that can apply in some cases. Contact the Office of the Judge of Probate to make a conclusive determination about whether you owe the deed tax and, if so, determine the exact amount of the deed tax. A simple Real Estate Sales Validation Form (included with our software) may also be required.

The process for completing the transfer is described in more detail in the instructions (Next Steps) that are provided by our software when each deed is created. These guidelines are customized to the type of deed and other information affecting the property transfer.

Types of Alabama Deeds

Several different deeds can be used to transfer Alabama real estate. Alabama recognizes three types of deeds based on the warranty of title:

1. General Warranty Deed – The Alabama general warranty deed form is used when owners want to provide a full warranty of title that covers the entire chain of title, including the time period before the current owners owned the property.
2. Statutory Warranty Deed – The Alabama statutory warranty deed is Alabama’s version of a special warranty deed. It provides a warranty of title that is limited to the time when the current owner (the owner conveying the property by deed) owned the property. The current owner is not responsible for anything that happened before that owner took title to the property.
3. Quitclaim Deed – An Alabama quitclaim deed form provides no warranty of title. It simply transfers the current owner’s interest, if any, to the new owner. Alabama title companies recognize quitclaim deeds, so no warranty deeds (deeds without warranty) are not used in Alabama.

Some states offer several options for using deeds for estate planning purposes (avoiding probate). Alabama only has one: The life estate deed. Life estate deeds involve co-ownership of real estate, but each class of joint owners has possession rights at different points in time. The person who owns the property during his or her life is called a life tenant. On the death of the life tenant, the other class of owners—called remaindermen or remainder beneficiaries—take possession of the property. Even though the right to possession occurs at different times, the property is considered jointly owned during the life of the life tenant.

The deeds created by our Deed Generator were designed by licensed Alabama attorneys to meet state requirements for the type of deed that you select.

Alabama Deed Requirements: Validity and Recording

Like most states, Alabama has state-specific requirements for validity of deeds and recording of deeds. Our Deed Generator was built to take these state-specific requirements into account and to produce deeds that are valid for recording in all Alabama counties. These requirements include:

• Unlike many states, Alabama law does not require any specific margin, font sizes, page sizes, or headings. But the Office of the Judge of Probate for each county may establish its own rules, and many have. As general guidelines:
  • Alabama deeds should be printed on either 8.5×11 inch paper (letter size; preferred) or 8.5×14 inch (legal size) paper using a font size of at least 10 points.
  • The first-page margin should leave room for the recorder’s stamp—customarily at least 3 inches.
  • The deed should list the mailing address of the new owner or owners (grantees).
• The deed must include a statement showing the name and address of the individual who prepared the instrument (Alabama Code 35-4-10).
• To avoid questions about the homestead status of the property (and related requirements under (Alabama Code § 6-10-3), the deed should state whether the property being conveyed is the homestead property of any person transferring the property.
• To be effective, the deed must also include a valid legal description that identifies the property. The legal description should almost always come from the prior deed to the property. Using the address, description from the tax records, or other self-made legal description can cause ambiguity that requires legal action to resolve.
• If any person transferring the property (grantor) is an individual, the deed must include a statement of that individual’s marital status (Alabama Code § 35-4-73).
• The deed should be signed by the current owner or owners, with each signature notarized using Alabama’s statutorily approved acknowledgments (Alabama Code § 35-4-29). There is no need for the new owners to sign the deed.
• The deed must be recorded in the Office of the Judge of Probate in the county where the property is located (Alabama Code § 35-4-50 and Alabama Code § 35-4-62).
• Unless an exception applies, a deed transfer tax must be paid when the deed is recorded (Alabama Code § 40-22-1). The amount of the Alabama deed transfer tax is $0.50 for every $500 of property value.
• When the deed is presented for recording, it must be accompanied by proof of the actual purchase price paid for the real estate or, if the property not being sold, evidence of the actual value of the property (Alabama Code § 40-22-1). As a practical matter, this requirement is usually satisfied using the Real Estate Sales Validation Form (RT-1) developed by the Alabama Department of Revenue. A copy of the Alabama Real Estate Sales Validation Form (RT-1) is included with the deeds produced by our Deed Generator at no extra charge.

These requirements must be satisfied for each type of Alabama deed discussed above.

Spousal Ownership of Alabama Real Estate

Alabama is a separate property (common law) state, so it does not recognize community property. When a deed is signed conveying property to one spouse, the property belongs to that spouse alone. For example, a deed to a wife does not give her husband an automatic interest in the property as it could in a community property state.

Even though a spouse does not acquire an interest in his or her spouse’s property by virtue of marriage, special rules apply to property that is used as the marital home (homestead). Alabama Code § 6-10-3 provides:

No mortgage, deed or other conveyance of the homestead by a married person shall be valid without the voluntary signature and assent of the husband or wife, which must be shown by his or her examination before an officer authorized by law to take acknowledgments of deeds, and the certificate of such officer upon, or attached to, such mortgage, deed, or other conveyance, which certificate must be substantially in the form of acknowledgment for individuals prescribed by Section 35-4-29.

Under this statute, a transfer of homestead property without the signature of both spouses is invalid. That is true even if only one spouse owns the property. For a married couple to convey Alabama homestead property, both spouses must sign the deed.

Because of the spousal homestead rights, it is customary for Alabama deeds to include a statement about whether the property is the homestead of the person signing the deed. If the person is unmarried, this provision has little value. But if the person is married, the statement about whether the property is homestead can help avoid title issues. Our Deed Generator includes required statements about homestead status and, if spousal signature is required, appropriate language for the spousal signature.

Forms of Co-Ownership of Alabama Real Estate

Alabama recognizes several basic forms of co-ownership that apply when more than one owner will own the property. These forms of co-ownership include joint tenancy with right of survivorship, tenancy in common, and life estates. Each of these are discussed below.

Joint Tenancy with Right of Survivorship

If all of the owners are humans (no businesses or trusts), then the owners may hold title as joint tenants with right of survivorship. When one owner dies, property held by that owner passes to the surviving owner or owners automatically, without the need to go through probate.

A Note on Tenancy by the Entirety

Some states recognize a special form of joint tenancy called a tenancy by the entirety. This form of co-ownership is available to married couples and can have asset protection benefits. Alabama does not recognize tenancy by the entirety.

Tenancy in Common

Some owners of jointly held property would prefer that the property pass to their family or others instead of passing to the surviving owners. For these owners, tenancy in common is often the best choice. It allows each owner to leave his or her interest to his or her estate. This benefit comes at a cost, though, because probate is often required to transfer an interest in property held as tenants in common.

Tenancy in common is generally the only choice if any of the owners are businesses or trusts. Because businesses and trusts have no lifespan, the concept of survivorship does not apply to them.

Life Estate

A life estate is a form of co-ownership that allows owners to hold interests at different points in time. One owner—called a life tenant—can hold title to the property for his or her life. At the life tenant’s death, the property passes automatically to another owner called a remainderman or remainder beneficiary. There can be more than one life tenant and more than one remainder beneficiary. Life estates are used in Alabama to avoid probate.