Alabama Deed Forms for Real Estate Transfers

What types of deeds are used to transfer Alabama real estate?

Alabama recognizes three types of deeds based on the warranty of title:

1. General warranty deed form. An 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 form. An 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 form. 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 deeds without warranty (sometimes called no warranty deeds) are not used in Alabama.

What types of estate planning deeds are used in Alabama?

Some states offer several options for using deeds for estate planning purposes. Alabama only has one: The life estate deed.

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.

What are the ways that multiple owners can hold title to 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.

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 often 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.

What are the rules for 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 law requires a spouse that is not listed on the deed to the property (non-titled spouse) to sign the deed to convey the property.

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 ¹

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.

Unlike the law of some states, Alabama law does not give a spouse dower or curtesy rights that require the spouse’s signature to convey property.

Where are deeds filed in Alabama?

In Alabama, deeds are filed with the office of the judge of probate of the county where the property is located. Unlike some states, Alabama deeds need not state whether the property is in a city or an unincorporated area and need not include the grantor’s and grantee’s county of residence when listing addresses in the vesting paragraph.

How much does it cost to file an Alabama deed?

Alabama recording costs for deeds 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.

Does Alabama charge a transfer tax on real estate transfers?

Alabama charges a deed tax on transfers of Alabama real estate. Unless an exception applies, a deed transfer tax must be paid when the deed is recorded.² The transfer tax rate is $0.50 for every $500 (rounded up) of value of the property being conveyed.

Does Alabama require any other form when recording a deed?

When an Alabama 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.³ 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.

1. Ala. Code § 6-10-3.
2. Ala. Code § 40-22-1.
3. Ala. Code § 40-22-1.