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Warranty Deed: Legal doc that conveys clear title

Posted on: 29th Jun, 2004 02:35 am
A warranty deed is a legal instrument that is used to transfer the title of a property from one person (grantor) to another (grantee). The most important feature of this deed is that here the grantor promises that the title is clear and free of liens. One major benefit of this deed is that it provides protection to you as the grantor warrants that he/she is the owner of the property and the property is free of outstanding liens.

What are the types of warranty deed?

There are 2 types of warranty deeds used for title transfer. They are:

1. General Warranty Deed:
This legal document guarantees that the grantor (or seller) is the legal owner of the property and no other person has an interest in the property, unless otherwise stated on the deed.

The guarantee offered in the General Deed is not limited to the time the grantor owned property. The grantor can be held liable for any title problems existing before they owned the property, as well as during ownership.

  • How it protects the grantee -
    A General Deed includes 6 types of covenants (agreements between the parties involved) divided into the following categories:

    1. Present Covenant: This represents the grantor's promise that he has legaltitle and possession to the property. The grantor's promise that the title is clear and free of any liens is also part of this covenant.

    2. Future Covenant: This includes the grantor's promise to protect the grantee against any other person claiming title. In some states, this covenant protects the grantor's promise to provide the legal documents necessary to prove that the title passed by the deed is valid.

  • When grantor is held liable -
    If the grantee finds out that someone else owns interest in property that was not listed in the title record, then they have the right to sue the grantor. If there is a defect in property-title such as a tax lien, mortgage claim, judgment, etc, then the grantee or buyer can hold the grantor or seller liable if the defect was not present in the title record.
2. Special or Limited Warranty Deed:

The Special/Limited or Statutory Warranty Deed does not offer as much protection as the General deed.
  • How it protects the grantee -
    The deed conveys grantor's title to the grantee and protects the latter against title defects or claims arising only during the grantor's ownership. The grantor warrants that there are no liens on the property unless otherwise stated on the deed or present in the title record.

    The Special Warranty Deed allows the grantee or buyer to ask the grantor for compensation to fix problems with the property which actually originated during the grantor's ownership in the property if they are guaranteed by the grantor. If a defect in the condition of the property is not warranted in the deed or disclosed prior to closing, then the grantor is not liable for it.

How do you make the deed valid?

The deed should provide the legal description of the property to be transferred. It should be drafted with respect in the state where the property is located. Moreover, the deed should be signed and witnessed by a notary. Check out a sample form given below in the Related References section.

The deed is delivered to the buyer at the time of closing. The buyer then records the deed at the County Recorder's office. The deed should be recorded within the specific period required by state law in order to be valid.

A Warranty Deed offers greater protection than a quitclaim deed. So, whether you're selling property or transferring it to a trust, this kind of deed can serve you the best. When purchasing property, the buyer should supplement the deed by purchasing title insurance policy. Both the deed and the policy can help protect the lender and the buyer against disputes concerning ownership or liens on property.

Related Forum Discussions

Related References

My parents' house is on several acres of land. They have given my fiance and I permission to build a house on their land. Should my parents deed the land to us that we would use to build our house and if so, are we able to pull the equity out of the land?
Posted on: 06th Feb, 2007 05:17 pm
Yes if they make out a deed to transfer the property in your name then you would be in a position to take financing help for building the house. Your parents can use a warranty deed to transfer the property in your & fiance's name.

Gary Price
Posted on: 06th Feb, 2007 05:28 pm
Yes, your parents should legally transfer the land in your name. After this, you can look out for financing options for constructing homes – possibly construction loans. Until and unless you are the legal owner of the land, you cannot pull equity out of the land.
Posted on: 06th Feb, 2007 09:08 pm
my parents want to do a quit claim deed to transfer their house to me their daughter in the event of their death. i don't see on quit claim deeds they say anything reagarding in the event of both grantors death. can you help me on that.
Posted on: 11th Mar, 2007 10:56 am
Hi Claire,

Welcome to our forums.

There are two options here. Either your parents transfer the property to you at present. Now, if they do not intend to give away the property to anyone else through a Will, then you will be the legal owner.

Secondly, and a better option is that your parents should sign a beneficiary deed (or transfer on death deed) over to you. Such a deed will help you to inherit property after your parents' death without a probate being held.

Refer to discussions on Transfer on Death deed and Beneficiary deed

Thanks,

Caron.
Posted on: 12th Mar, 2007 03:27 am
I am confused - what is the difference between "quit" claim and "quick" claim deeds?
Posted on: 10th May, 2007 12:49 pm
Hi Dodie,

Welcome to Mortgagefit discussion board.

Don't get confused :)

Actually it is quit claim deed and people misspell it as quick claim deeds. Thats all.

If you are going to use quit claim deed for transferring property to someone, then I would suggest you go through this page to know more about how it is used in property transfers: http://www.mortgagefit.com/quitclaim-deed.html

Do let me know if you have any other questions.

Thanks
Blue
Posted on: 10th May, 2007 01:06 pm
My husband and I have been living in my parents home in Alaska and paying the Mortgage for 18 years with the agreement that it would be our when payed off. They (my parents) moved back 10 years ago and told us they would build a cabin on the property because the house was ours. They tried to take out an Equity loan but had not found jobs yet so the banker suggested adding my Husband and I to the Title and having us get the Equity loan. That is what we did. Now with 4 years left on mortgage and equity loan with 2 payments left we (my Husband and I ) have a falling out with the Parents and they are kicking us out. Since we are on the title what are our rights? And can they remove us from the title without our knowing?
Posted on: 03rd Jun, 2007 06:32 pm
hi i want to sell my property to a family member and then be added on to the new loan after it has been recorded. how do i do this and still be owner of the property?
Posted on: 26th Jun, 2007 12:49 pm
Hi Charise,

After you sell your property you will not remain owner. The owner will be the person to whom you will be selling it.

Let me also add the lender will not agree to add you to the loan as after selling the property you will not have any rights over it. And the lender would require everyone on the loan to have ownership rights over the property.

Miller
Posted on: 26th Jun, 2007 01:15 pm
"they are kicking us out. Since we are on the title what are our rights? And can they remove us from the title without our knowing?"

Hi Laurie,

They cannot remove you from the house. Both of you have ownership rights over the house as you were added to the title.

You have as much rights on this house as they have and they cannot remove you from the title without your signatures on some property transfer deed. Did you sign on anything?

If you haven't signed any kind of property deed for transfer of your interest then both of you are still co-owners along with your parents.

As they are your parents I don't thing they seriously mean to have you out of the house. After a few days when the things settle down they would stop behaving like you are not required in the house. :)
Posted on: 26th Jun, 2007 01:48 pm
mom quick claimed deed house in 3 children name 11 yrs ago Can assisted home take money on sale of house
Posted on: 02nd Aug, 2007 06:02 pm
"mom quick claimed deed house in 3 children name 11 yrs ago Can assisted home take money on sale of house"

Donald, as your mom had quit claimed the house 11 years ago, proceeds from house sale will not be taken for payment of assisted living she is receiving.

Miller
Posted on: 02nd Aug, 2007 06:26 pm
Hi Donald,

Across the U.S., monthly average charge for assisted living is $1,800. Generally, the family members pay the cost of assisted living.

If no one in the family pays for the cost, then proceeds from the sale of the house can be used to pay for the assisted living.
Posted on: 04th Aug, 2007 01:37 am
my grandfather is terminally ill and has a lot of unpaid medical bills. my father's name is currently on the deed to my grandfather's property. my dad wants to take his name off of my grandfather's deed--in fear of being stuck with my grandfather's debt after he passes. my dad was planning on doing a quitclaim deed...however, is a warranty deed better? my dad has no interest in my grandfather's property whatsoever. what are your thoughts? Thanks!
Posted on: 19th Aug, 2007 03:17 pm
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