Do You Know the Difference Between the Different Types of Deeds?
August 30, 2017 | Heather Griesser LaPierre
There is so much terminology in real estate that it’s easy to feel a little lost… after all, you’re neither a realtor, a mortgage broker, or a real estate lawyer! What is a deed and why should you make sure you know what the deed is before signing?

A deed enables the transfer of property from one owner to another. When the deed is transferred over to you as the new owner you’ll decide how you are going to hold title. We’ll cover that in our next blog. Below, we explain the three most common types of deed:

Quit Claim Deed
This is the simplest form of deed and it does not contain warranty of title. What does that mean for you the buyer? The grantor – who you believe is the current owner of the real estate – is just signing over what title or interest they have, or think they have, to the property. It doesn’t make any promises that the grantor has the title to the conveyance of the property itself.
For instance, the renter of the property could pretend to be the owner, selling you something that doesn’t belong to them. There is no recourse if this were to happen.

General Warranty Deed
A warranty deed transfers the property itself, unlike the above which merely transfers whatever interest the grantor may or may not have. It gives full rights and ownership to the buyer.  With a general warranty deed the grantor agrees to defend your right to the property should someone comes forward to make a claim on the title.

Special Warranty Deed
This deed offers less protection than a general warranty deed, though more than a quit claim deed. It only guarantees the title for the time-period that it was owned by the grantor.  This means that you could be liable for debts or encumbrances that occurred before the grantor owned the title.
For example, there may be an old lien against the house with someone claiming the right to be paid for debts when the house is sold.

Title Insurance 
While both general and special warranty deeds provide more coverage for you the buyer than a Quit Claim Deed, we always recommend that you take out title insurance. In fact, some mortgage companies will not approve the mortgage loan without you taking out title insurance.  Title insurance is about protecting you against financial loss if any claims are made on the property in the future. It is worth it for the peace of mind.


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