Understanding Real Estate Deeds: Warranty Deeds, Grant Deeds, and Quit Claim Deeds
One of the most basic advices, for anyone conducting business/trade with anybody else is to write down the agreement and have it signed with all of the concerned parties. It saves you from various complications and tricky situations in the future. A business agreement or contract illustrates the rights and obligations for both buyers and sellers, the terms and conditions described in the contract allows the signers to seek legal help, in case the other party has deceived them. In real estate transactions, contracts are even more important, for the reason that a routine real estate transaction involves huge amount. A real estate contract includes the credentials of the parties involved along with their signatures, exact information about the property in question and the purchasing price. However, a contract is not the only document which is needed to transfer the ownership, the document that transfers the ownership is known as deed.
Almost all deeds are the same in nature (all are used to transfer the ownership from seller to buyer) but the accompanying terms and conditions differ to some extent. There are three common types of real estate deeds, let’s read about each of them in detail. Remember that the word ‘Grantor’ denote seller while ‘Grantee’ stands for the buyer.
Warranty Deed: Most common form of real estate deed is known as warranty deed. In this deed, the seller pledge that he/she has the absolute right to sell the property, that’s the reason it is also called the full covenant. Which means the grantor is providing specific warranties regarding the title of the property along with the ownership, itself.
Grant Deed: It is more or less the same as Warranty deed; however in some cases it carries fewer guarantees as compared to the warranty deed. They are the most commonly used form of real estate deeds in a number of US states and even though the law doesn’t necessitate the notarization, people still certify it legally to be on the safe side.
Quit Claim Deed: Quit claim deed (as the name suggests) is limited to transferring the ownership to another party, in other words the grantor quits his/her right over the property. A quit claim deed usually comes without any kind of warranties, the grantor just gives up his/her rights without guaranteeing anything about the accuracy of the title, which means a quit claim deed is relatively insecure one. Although, these are the three most commonly used deeds, there are other types of deeds like Tax deed or Gift deed, as well.
Written by: William King is the director of Pakistan Real Estate and Dubai Real Estate. He has 18 years of experience in the marketing and trading industries and has been helping retailers and startups with their product sourcing, promotion, marketing and supply chain requirements.