A few weeks ago I wrote a post on real estate titles and deeds. I wanted to follow up on that post with a bit more detail on a couple of widely used deed types. I know, this can seem like this is simple stuff, but in reality it can be a bit complex. It can be especially complex to the newbies out there who are perhaps hearing these terms for the first time.
First, let’s look again at exactly what a deed is. A deed is a conveyance of real estate. It is signed by a grantor (typically a seller) and is the instrument that commonly transfers the title to real estate from one person to another. A deed is how one “sells” real estate.
There are two common types of deeds that are used between what are often referred to as “normal” buyers and sellers. Those two types are warranty deeds and quitclaim deeds. While both of these documents are deeds, what they convey and how they convey it are quite different and every real estate investor should understand that difference.
There are of course other types of deeds such as tax deeds, special warranty deeds, etc. But these are usually used in special situations between “non-normal buyers” such as when a bank forecloses on a property. I will cover those in another post.
A warranty deed is a deed in which the grantor warrants that they have a good, clear and marketable title. You can think of this type of deed just as you would with any other product in which you get a warranty. The maker or seller of the product provides you with ..