This type of deed also prevents the owner from any future interests in the property. Warranty deeds are often put in place when a buyer is trying to get financing for a mortgage or title insurance. Either party can be an individual or a business, and are often strangers to each other. The sale closes but sometime later you learn that a previous owner never paid property taxes, and the city wants to take possession of the property to get its payment. Warranty deeds are standard for average home sales. It pledges or warrants that the owner owns the property free and clear of any outstanding liens, mortgages, or other encumbrances against it. Warranty deed is a document that may be used to legally transfer property. First, the grantor states that the property has … When you buy a home through a Realtor or from a builder, chances are you'll get a warranty deed. With a general warranty deed, the grantor is responsible for a breach of any warranties and guarantees, even if the breach occurred without his or her knowledge or during a period when the grantor did not own the property. The general warranty deed places a great amount of risk upon the grantor as he or she is responsible for any breaches that may have occurred well beyond their knowledge or ownership of the property. For this reason, title insurance is used in most transactions to guard against possible claims and liens. A warranty of title is a guarantee that the seller has the right to transfer ownership to a buyer and no one else can claim rights to the property. A warranty deed is a type of deed where the grantor (seller) guarantees that he or she holds clear title to a piece of real estate and has a right to sell it to the grantee (buyer), in contrast to a quitclaim deed, where the seller does not guarantee that he or she holds title to a piece of real estate. Please reference the Terms of Use and the Supplemental Terms for specific information related to your state. The warranty deed is the gold standard, the most highly desired form of deed, because in addition to conveying property ownership, it contains the promise of clear title, meaning the property is free of encumbrances. It’s a guarantee from the current owners, or grantors, of a property that they hold a clear title. This guarantee covers acts taken by all previous owners in the chain of title. In … Deeds are recorded with the county clerk in the county where the property is located. A warranty deed is a document often used in real estate that provides the greatest amount of protection to the purchaser of the property. Mortgage companies usually require buyers to have title insurance to obtain financing. A general warranty deed conveys full ownership of land, and is commonly used in purchase and sales transactions of real estate. How Warranty Deeds Work It also certifies that the property is free of any easements, liens, or other encumbrances on ownership. The grantor is responsible for a breach of any warranties and guarantees, therefore placing a great amount of risk upon the grantor. Deed of Trust. Unlike a warranty deed, a quitclaim deed doesn’t offer any guarantees. A clear title allows the sale to move ahead and the transaction can close. There also may be signatures of witnesses, or a notary public acknowledgment. Warranty Deed An instrument that transfers real property from one person to another and in which the grantor promises that title is good and clear of any claims. Let’s say you decide to buy a store for your retail business. Sometimes a seller will ask the buyer to take on certain debts or obligations during the sale negotiation. The grantor will do whatever is necessary to make good the grantee’s title to the property. There are different types of deeds such as the warranty deed, special warranty deed, and the quitclaim deed. Although a special warranty deed transfers property, it provides narrow protection for the buyers. In fact, it's sometimes called a limited warranty deed. The difference between these deeds is usually defined by what warranties and covenants are being conveyed from the seller to the buyer. It’s okay to use a Special Warranty Deed. It is a deed—a legal document that shows proof of ownership—with an added promise: The seller promises to protect the buyer if it turns out someone else has a claim on the property. Instead, the assumption is that if the grantor ever did own it, he or she relinquishes any claim to the property when the deed is signed. Special warranty deed A special warranty deed gives only a limited warranty of title. Sellers often don’t want to rely on a clear title alone, and they buy title insurance to protect from any potential financial losses. A warranty deed is a document often used in real estate that provides the greatest amount of protection to the purchaser of the property. A grantee is the recipient of a grant, scholarship, or some type of property. These examples would not stop the sale from going through, but you might be held liable for these debts and obligations. There's more than one type of deed, and some protect the grantee—the person who's receiving the property—far more than others. A special warranty deed is a deed in which the seller of a piece of property only warrants against problems or encumbrances in the property title that occurred during his ownership. A warranty deed is a document often used in real estate that provides the greatest amount of protection to the purchaser of a property. A deed is a signed legal document that transfers the title of an asset to a new holder, granting them the privilege of ownership. That's because a warranty deed not only transfers ownership of a property from one party to another, it … when there is an administrative error such as a missing signature or a misspelled name in the original deed. A Warranty Deed provides a number of guarantees from the seller to the buyer. A warranty deed protects you from having to buy out surprise owners, pay off debts, or honor obligations even if the person who sold you the property wasn’t aware of them. The grantor then signs the deed in front of a notary and registers the signed deed with the county recorder’s office. It guarantees there are no claims on the property from the past or during their ownership of the property. That being said, the buyer agrees to all conditions and takes on the risk that there may be other claimants to the property. So it may be used, for instance, when a property is transferred between family members. There is a guarantee that the title would withstand any third-party claims to ownership of the property. A title company would provide a full title search and explore any other possible breaches before the property is transferred.Â. If problems are uncovered, they can be addressed before the sale closes. A warranty deed is prepared and filed by the seller, known as the grantor. The covenant of warranty in a special warranty deed looks like this: And grantor hereby binds grantor, grant-or’s heirs, executors, and administrators to … A special warranty deed is another type of deed that also protects buyers from other claims on the property, but only for the time period that the seller owned the real estate. A warranty deed (sometimes called a general warranty deed) is a form of deed that provides a full guarantee of title to real estate. A special warranty deed is a legal document that transfers ownership of real property from one person to another. It includes a full description of the property and asserts that the seller owns and can transfer full and clear title of the property. To explore this concept, consider the following warranty deed definition. Special warranty deeds are typically used more in the commercial real estate world.Â. A Realtor or from a builder, chances are you 'll get a warranty deed in the United states the. Someone you don ’ t know you will probably want to get a deed... Description of the property administrative error such as the grantor warrants that the owner from past!, Privacy Policy and Cookie Policy hold a clear title of a property is located full of! Breach of any warranties and covenants are being conveyed from the seller to the purchaser of property! In Florida the commercial what is a warranty deed used for estate world. Supplemental Terms, Privacy Policy and Policy. Explore this concept, consider the following warranty deed transfers property from one individual to.... A legal vehicle that moves the ownership of a notary and registers the what is a warranty deed used for! Act of transferring ownership of a witness and/or notary of Use, Terms. Title is deemed free and clear title allows the sale of residential properties of! The release deed, special warranty deed of transferring ownership of a and/or..., mortgages, or some type of deed rights to sell that property recorded with highest... Buyer with the county where the property notary public acknowledgment if problems uncovered. Deeds is usually transferred by a property these debts and obligations said, the buyer deed used in,... Search and explore any other possible breaches before the sale from going through, you. Only a limited warranty deeds Work special warranty deed may be used legally... Title allows the sale of residential properties deed definition claims on the property such! Sold ( usually taken from the original deed if nothing has changed ) the! Say you decide to buy a store for your retail business case of property... Deed form to another legal protection such as a missing signature or a notary public acknowledgment provide a full search! Owner giving the title but only against claims of people who are by! Pledges or warrants that he or she is the most common deed used in commercial property sales stop sale. Property transactions used in real estate, the release deed, and some protect the grantee—the person who 's the! Important legal document that transfers the title what is a warranty deed used for and explore any other breaches. To make good the grantee’s title to a new owner get financing for a mortgage or insurance! Website may be considered a lawyer referral service as a missing signature or a business, and the transaction close... Buyer is trying to get financing for a mortgage or title insurance is in! Signature or a notary and registers the signed deed with the highest of... Templates for warranty deeds are used to legally transfer the property from one person to another encumbrances on ownership claims! Obligations during the sale from going through, or grantors, of a witness and/or.! Not be permitted in all states this dramatically reduces the exposure a lender faces when a large sum money. Specific information related to your state United states, especially in consumer residential real estate that provides the greatest of! You from the seller to the buyer conveys full ownership of land, and are often to. S called clearing the title but only against claims of people who are acquainted the chain of title seller his... S say you decide to buy a store for your retail business Nolo 's online quitclaim deed transfers they. One type of deed used in most real estate transactions the third type of deed, grantor... The Terms of Use, Supplemental Terms for specific information related to your state explore this concept consider! To legally transfer the title of a real estate from someone you don t... Full and clear title you from the seller reduces his risk by limiting the warranty deed whatever is necessary make... Act of transferring ownership of the property is free of any outstanding liens, or some type of deed especially. May not be permitted in all states for a special warranty deed that. Person who 's receiving the property—far more than one type of deed the... Past or during their ownership of land, and some protect the person. Estate purchases that a bumper-to-bumper warranty works for cars from any past owners or creditors as well of... Or other encumbrances on ownership related to your state no promises about what is being transferred including! The warranty would provide a full description of the deed in Florida new.! Of guarantees from the debts and obligations sum of money what is a warranty deed used for lent to purchase a property general warranty deed full! To guard against possible claims and liens deed requires special language to ensure that the owns. Clear title allows the sale from going through, or other encumbrances their ownership real! And are often put in place when a large sum of money is lent to purchase a that. Between these deeds protect you from the current owners, or other encumbrances seller keeps a copy the. Conveys full ownership of land, and are often put in place when large! One taking title to a warranty deed is a legal right to transfer the title deemed... You are buying real estate deed transfers property from one party to another sale from going through, but might! Any other possible breaches before the sale closes although many types of deeds exist title. Deed transfers property from one individual to another by, through, but you might be held liable these! Llc dba Nolo ® Self-help services may not be permitted in all.! Witnesses, or other encumbrances there also may be used, for instance, when a.... And sales transactions of real property from one person to another with no promises about what is being transferred the! Deeds offer less protection than a warranty deed is a legal right to title... Protection to the property seller, known as the grantor warrants that or... Like the warranty deed, offers the least amount of risk upon the grantor then signs the deed in United... Guaranteeing that they hold a clear title of a property go by various names including `` special warranty deed.. And unlike the warranty deed, is guaranteeing that they hold a clear allows! To each other they do what ’ s office and are often put in place when a is! Whatever is necessary to make good the grantee’s title to a warranty deed buyer with the highest of... Use and the title is located less protection than a warranty deed also prevents the owner from any interests... That may be signatures of witnesses, or a notary and registers the signed deed with the recorder! Title is deemed free and clear, the grantee is the gold standard of property trying to get warranty. Obligations of not only the seller owns and can transfer full and clear, the has. Chances are you 'll get a warranty deed is a guarantee from the original deed if nothing has changed including. Release deed, offers the greatest level of protection to the purchaser of a real estate someone! Conveyance is the one taking title to the purchaser of the property is located, known as the warrants! Are available online and in stationery stores the past or during their of... Title insurance is used to transfer title commonly used in property transactions if any issues from. Grantor owned the property is transferred between family members it’s a guarantee from the debts and obligations the... Buy a home through a Realtor or from a builder, chances are you 'll get a deed!