Not all deeds are the same. When property is transferred, the language in each deed will provide certain warranties from the seller. It’s important to understand the types of deeds that are out there as you might not be getting the protections that you deserve with some deeds. In this article, we are going to discuss three common types of deeds and what they generally cover.
GENERAL WARRANTY DEED: This type of deed provides the most protection to the buyer of the four deeds we’ll be discussing. You will be looking for the word “warrant” in this deed as the seller is typically “warrantying” that they own the property and the property is free of liens or other encumberances.
SPECIAL WARRANTY DEED: This type of deed is a step down from a General Warranty Deed as it doesn’t warranty that there weren’t encumberances on the property prior to the seller taking ownership of the property. It does, however, warranty that the seller owns the property and that any encumberances when they owned the property. This type of deed is common in an estate sale.
QUITCLAIM DEED: This is not a “Quick Claim” deed like many people think. It’s actually a “Quitclaim” Deed. This type of deed provides very little protection to the buyer in that it simply transfers ownership without any warranties from the seller. The seller isn’t even warrantying that they own the property. The seller isn’t even warrantying that there aren’t any liens on the property. Why would anyone accept a quitclaim deed? Usually, this type of deed might be used in a “non-arms-length” transaction such as when a property is transferred between family members.
There are, of course, other types of deeds, but these are the three that you most often might see. It is important to understand what the seller is warrantying when the transfer the property. If you have any questions about deeds, it’s certainly a good idea to consult with a good real estate attorney.