What is a Warranty Deed ?
A warranty deed is a legal document used in real estate transactions to transfer ownership of a property from one party (the grantor or seller) to another (the grantee or buyer). It guarantees that the seller has clear and valid ownership of the property and will defend the buyer against any claims or disputes related to the title.
By using a warranty deed, the seller is assuring the buyer that they have the legal right to sell the property and that they will defend the buyer's ownership against any future claims made by others. This means that if any title issues arise after the sale, the seller is responsible for resolving them and compensating the buyer for any losses incurred.
A warranty deed typically includes important information such as the names and addresses of the grantor and grantee, a legal description of the property, the purchase price (if applicable), and any conditions or restrictions associated with the property transfer. It must be signed and notarized to be legally valid.
The document also includes various other sections, such as covenants, warranties, and signatures, which outline the specific obligations and guarantees made by the grantor. Additionally, it may require notarization and recording in the appropriate land records office to be legally valid.
How Does Warranty Deed Work ?
Warranty deeds work by legally transferring ownership of a property from a grantor to a grantee while providing certain warranties and assurances regarding the property's title. A warranty deed provides the highest level of protection for the buyer because it guarantees that the seller has clear and marketable title to the property and has the right to sell it. Here's a step-by-step overview of how warranty deeds typically work:
1) Agreement to Sell:
The seller and buyer negotiate and agree on the terms of the property sale, including the purchase price, closing date, and any other relevant conditions. Once the agreement is reached, both parties proceed to execute a warranty deed.
2) Preparation of the Deed:
The warranty deed is typically prepared by a real estate attorney or a title company. The deed includes the legal description of the property, identification of the grantor (seller) and grantee (buyer), and the specific language outlining the warranties and assurances being provided.
3) Execution and Delivery:
The grantor must sign the warranty deed in the presence of a notary public, who acknowledges the grantor's signature. The completed and notarized warranty deed is then delivered to the grantee.
4) Recording the Deed:
To make the transfer of ownership official and provide notice to the public, the warranty deed is typically recorded in the county or jurisdiction where the property is located. This step is usually handled by the grantee or their representative, such as a title company. Recording fees may apply.
5) Warranty Protection:
The warranties included in the warranty deed offer protection to the grantee (buyer). If any issues arise regarding the property's title, such as undisclosed liens or competing ownership claims, the grantee may have legal recourse against the grantor (seller) based on the warranties provided.
Types of Warranty Deeds
There are two types of warranty deeds commonly used in real estate transactions. Here are the main types:
1) General Warranty Deed:
A general warranty (also know as Statutory Warranty Deed) deed provides the highest level of protection to the buyer (grantee). It includes a series of covenants or warranties from the seller (grantor) that cover the entire history of the property. These warranties typically include the covenant of seisin, covenant of right to convey, covenant against encumbrances, covenant of quiet enjoyment, and covenant of further assurance. With a general warranty deed, the seller is legally bound to defend the buyer against any claims or issues arising from the property's past.
2) Special Warranty Deed:
A special warranty deed, also known as a limited warranty deed, offers a more limited set of warranties compared to a general warranty deed. The grantor of a special warranty deed only warrants or guarantees against defects in the title that may have occurred during their ownership period. This means that the grantor is not responsible for any issues that existed before they acquired the property. The warranties provided in a special warranty deed typically include the covenant of seisin, covenant of right to convey, and covenant against encumbrances, but they are limited to the grantor's ownership period.
What’s Included in a Warranty Deed ?
When a property is transferred through a warranty deed, the seller (grantor) warrants or guarantees certain things to the buyer (grantee). Here are the key elements typically included in a warranty deed:
1) Grantor and Grantee Information:
A warranty deed includes the names and addresses of both the grantor (seller) and the grantee (buyer). This ensures that the parties involved in the transaction are clearly identified.
2) Property Description:
The deed provides a detailed legal description of the property being transferred. This description typically includes information such as the boundaries, dimensions, and any identifying markers or features that accurately define the property.
3) Words of Conveyance:
The warranty deed contains specific language indicating the grantor's intention to transfer ownership of the property to the grantee. Phrases like "convey and warrant," "grant," or similar terms are commonly used to express this intention.
4) Covenants:
A key feature of a warranty deed is the inclusion of covenants, which are legally binding promises made by the grantor to the grantee. These covenants typically include the following:
a) Covenant of Seisin:
This covenant guarantees that the grantor has legal ownership and possession of the property and has the right to transfer it to the grantee.
b) Covenant of Right to Convey:
This covenant ensures that the grantor has the legal authority to sell or transfer the property.
c) Covenant Against Encumbrances:
This covenant guarantees that the property is free from any liens, encumbrances, or other claims that could affect the grantee's title, except for any specifically mentioned in the deed.
d) Covenant of Quiet Enjoyment:
This covenant guarantees that the grantee will not be disturbed in their possession and enjoyment of the property by any third-party claims.
e) Covenant of further assurance:
This covenant ensures that the grantor will defend the grantee's title against any future claims and compensate the grantee for any losses incurred as a result of defects in the title.
5) Signature and Notarization:
A warranty deed must be signed by the grantor in the presence of a notary public. The notary public will then acknowledge the grantor's signature and affix their seal or stamp to the document.
Requirements for warranty deed
The requirements for a warranty deed can vary depending on the jurisdiction or state where the property is located. However, there are some common elements that are typically required for a warranty deed to be valid. Here are the general requirements:
1) Title:
The deed is usually titled as a "Warranty Deed" to clearly indicate the type of document it is.
2) Parties:
The introduction identifies the parties involved in the transaction. This includes the names and addresses of both the grantor (seller) and the grantee (buyer). It may also mention any additional individuals or entities involved in the transaction, such as spouses or co-owners.
3) Legal Capacity:
The grantor must have the legal capacity to transfer the property. This means they must be of sound mind, of legal age (usually 18 years or older), and not under any legal disability.
4) Identifying Information:
The warranty deed should include the full legal names and addresses of both the grantor and the grantee. This helps ensure the parties involved are clearly identified.
5) Recitals:
The recitals section provides a brief background and context for the transfer of the property. It typically mentions the grantor's ownership of the property and their intent to transfer it to the grantee.
6) Description:
A warranty deed must contain an accurate and detailed legal description of the property being transferred. The description should be sufficient to identify the property without ambiguity.
7) Granting Language:
The deed must include clear and explicit language indicating the grantor's intention to transfer ownership of the property to the grantee. Common phrases used for this purpose include "convey and warrant," "grant," or similar terms.
8) Consideration:
The consideration section states the value or consideration for which the property is being sold. This can be a monetary amount or other agreed-upon terms of exchange.
9) Execution Date:
The introduction includes the date on which the warranty deed is executed, which is the date when it is signed by the grantor. This date is important for establishing the timeline of the transaction.
10) Delivery and Acceptance:
The warranty deed must be delivered by the grantor to the grantee, and the grantee must accept the deed. This exchange typically occurs during the closing of the real estate transaction.
Necessary Documents for Warranty Deed
To create a valid warranty deed, several documents are typically required. While the specific requirements may vary depending on the jurisdiction and circumstances, here are the necessary documents commonly associated with a warranty deed:
1) Warranty Deed Form:
The warranty deed itself is the primary document required. It is a legal instrument that contains the necessary provisions, covenants, and information related to the transfer of property ownership. The form can vary slightly depending on the jurisdiction, but it should include all essential elements discussed earlier, such as grantor and grantee information, property description, covenants, and signatures.
2) Property Description:
A detailed legal description of the property being transferred is crucial. This description typically includes information such as boundaries, dimensions, survey references, and any other relevant details necessary to accurately identify the property.
3) Title Report or Abstract:
A title report or abstract is often obtained from a title company or a qualified professional to ensure the property's title is clear and marketable. This document provides information on the property's ownership history, any liens, encumbrances, or other claims that may affect the title, and any necessary steps to resolve such issues.
4) Supporting Documents:
Depending on the circumstances, additional documents may be required to support the warranty deed. Some examples include:
5) Affidavit of Title:
This document is typically signed by the grantor and provides a sworn statement regarding the grantor's ownership of the property, absence of undisclosed liens, and other relevant information related to the title.
6) Certificate of Trust (if applicable):
If the grantor is a trustee representing a trust, a Certificate of Trust may be necessary to provide evidence of the trust's existence and the trustee's authority to act on behalf of the trust.
7) Power of Attorney (if applicable):
If the grantor is unable to sign the warranty deed personally and has authorized someone else to act on their behalf through a power of attorney, a properly executed power of attorney document may be required.
8) Other Supporting Documents:
Depending on the circumstances and local requirements, additional documents may be necessary, such as a certificate of satisfaction or release for any existing mortgage or liens.
How to Get a Warranty Deed ?
To obtain a warranty deed, you typically need to follow these steps:
1) Consult with a Real Estate Attorney:
It's advisable to consult with a real estate attorney who can guide you through the process, explain local laws, and draft or review the warranty deed to ensure it meets all legal requirements.
2) Gather Necessary Information:
Provide the attorney with all relevant information regarding the property, including the legal description, current ownership details, and any specific provisions or conditions that need to be addressed in the warranty deed.
3) Prepare the Warranty Deed:
The attorney will prepare the warranty deed based on the information you provided. They will include the necessary language, warranties, and legal clauses required by local laws. The attorney may also conduct a title search to verify the property's ownership history and check for any liens or encumbrances.
4) Review and Sign the Warranty Deed:
Carefully review the warranty deed prepared by your attorney to ensure accuracy and that all terms and conditions are as agreed upon. Once satisfied, you (as the grantor) will need to sign the deed in the presence of a notary public. The notary will acknowledge your signature.
5) Delivery of the Warranty Deed:
The executed and notarized warranty deed must be delivered to the intended grantee (buyer). This can be done in person or through a trusted representative, such as a title company.
6) Record the Warranty Deed:
To make the transfer of ownership official and provide notice to the public, the warranty deed needs to be recorded with the appropriate government office, typically the county recorder's office where the property is located. The grantee or their representative is responsible for handling the recording process and paying any applicable fees.
7) Retain Copies:
It's important to keep copies of the executed warranty deed for your records, as well as any receipts or documentation related to the recording process.
Remember, the process of obtaining a warranty deed can vary based on local laws and practices. Consulting with a real estate attorney is crucial to ensure compliance with all legal requirements and to address any specific considerations related to your situation.
Does a Warranty Deed Prove Ownership ?
A warranty deed is an important document in a real estate transaction, but it does not alone prove ownership of a property. While a warranty deed provides assurances and warranties from the seller (grantor) to the buyer (grantee), it is primarily a legal instrument used to transfer ownership rights.
The warranty deed establishes a legal relationship between the grantor and grantee, with the grantor warranting certain things about the property's title and ownership. It indicates that the grantor has the legal authority to sell the property and that they guarantee clear and marketable title, free from undisclosed liens or encumbrances, except as specifically stated in the deed.
To establish ownership, the warranty deed needs to be recorded with the appropriate governmental authority, typically at the county or municipal level. The act of recording the deed serves as a public notice of the change in ownership and helps establish a chain of title for the property. Recording the deed provides evidence that the buyer is now the owner of the property.
In addition to the warranty deed, other documents and evidence can contribute to establishing ownership, such as a title search, title insurance, surveys, and other relevant legal and financial records. These documents and processes work collectively to confirm ownership and ensure a clear title.
Frequently Asked Questions
How does a warranty deed differ from other types of deeds?
Unlike a quitclaim deed, which makes no guarantees about the title, a warranty deed provides a higher level of protection for the buyer. It includes warranties or promises from the seller that they have the legal right to transfer the property, and that the property is free from any undisclosed liens or encumbrances.
What is a warranty deed used for?
A warranty deed used in real estate transactions to transfer ownership of a property from one party to another. It provides a guarantee or warranty from the seller to the buyer that the property being sold is free and clear of any liens, encumbrances, or title defects, except those specifically mentioned in the deed.
Where do I get a warranty deed ?
You can obtain a warranty deed from the county clerk's office or a local title company that handles real estate transactions. These entities typically provide the necessary forms and guidance for creating a warranty deed.
What warranties are typically included in a warranty deed?
The specific warranties in a warranty deed may vary depending on the jurisdiction, but they usually include assurances that the seller has the right to convey the property, that the property is free from encumbrances (except those disclosed in the deed), and that the seller will defend the buyer against any future claims to the title.
Can a warranty deed be used for both residential and commercial properties?
Yes, a warranty deed can be used for both residential and commercial properties. It is commonly used in most real estate transactions where the seller wants to provide a strong guarantee of the property's title.
Who prepares a warranty deed?
In many real estate transactions, the seller's attorney or a title company prepares the warranty deed. However, the responsibility for preparing the deed can vary depending on local practices and the agreement between the buyer and seller.
Is a warranty deed necessary if I'm buying a property with title insurance?
While title insurance provides protection against certain title defects, a warranty deed is still important. It ensures that the seller is legally transferring clear title and provides additional assurances that may not be covered by title insurance.
Can a warranty deed be revoked or canceled after it's been executed?
Once a warranty deed has been properly executed and delivered, it generally cannot be easily revoked or canceled. However, in exceptional circumstances, such as fraud or mistake, a court may consider invalidating a warranty deed.
Are there any specific requirements for a warranty deed to be valid?
To be valid, a warranty deed must meet certain requirements, which can vary by jurisdiction. Generally, it should be in writing, properly executed by the grantor (seller), identify the property being transferred, include the warranties, and be delivered to the grantee (buyer).
Can a warranty deed be used to transfer property between family members or within a trust?
Yes, a warranty deed can be used to transfer property between family members or within a trust. It is a common method for transferring property while providing a level of protection for the recipient. However, it's essential to consult with legal professionals to ensure compliance with any specific family or trust laws in your jurisdiction.
What is the difference between a warranty deed and a quitclaim deed?
A warranty deed guarantees that the seller holds clear title to the property and provides certain warranties to the buyer. In contrast, a quitclaim deed transfers whatever interest the seller has in the property without providing any warranties. Quitclaim deeds are commonly used in situations where the parties have an existing relationship or when there is uncertainty about the property's title.
Do I need a warranty deed to transfer property?
While the use of a warranty deed is common in many real estate transactions, the specific requirements can vary by jurisdiction. In some cases, other types of deeds, such as quitclaim deeds or special warranty deeds, may be used.
How long is a warranty deed valid?
A warranty deed does not have an expiration date. Once the deed is properly executed and recorded, the warranties provided by the grantor typically remain in effect indefinitely. However, the time frame for seeking legal recourse based on the warranties may be subject to applicable statutes of limitations, which can vary by jurisdiction.