Warranty Deed

Warranty Deed Basics

A warranty deed is a type of deed where the home seller (grantor) guarantees that he or she holds a clear title to a piece of real estate. The warranty is meant to reassure you, the buyer, that the grantor has a right to sell the property. This guarantee extends back to the property’s origins and is not limited to the time in which the grantor owned the property.

Warranty deeds are important because they protect the buyer from title problems that can occur after the purchase of the property. These problems can cost a significant amount of money and headache, and should be avoided at all costs.

What the Deed Warrants

A warranty deed makes certain declarations that must be true to the grantor’s knowledge. Every deed requires the grantor to declare that:

• There are no hidden liens or other encumbrances upon the property that is to be sold.
• He or she is the rightful owner of the property and is allowed to legally sell it.
• If there is a future problem with the title, compensations for losses will be made to the purchaser or purchasers of the property. (This guarantee is, of course, only useful if the grantor is still alive when the problem is discovered.)

Warranty Deed Contents

To be official, a deed must list a grantor (person or persons selling the property) and a grantee (person or persons buying the property). The deed must be in writing, signed by the grantor, and delivered and accepted by the grantee. Though the grantor’s signature does not always have to be notarized, it is recommended as an additional method of recordation.

Though a deed may be filled with a fair amount of legal jargon, the following essential information must be included if the deed is to be effective:

• Grantor’s name (If the property is owned by more than one person, each person must be listed on the deed.)
• Grantee’s name (If the property is being purchased by more than one person, each person should be listed on the deed.)
• Description of the property (the property’s street address, city, county, and state)
• Purchase price of the property (not every warranty deed lists a purchase price, but it can be included.)

A Final Note

Though a warranty deed offers considerable protection against fraud and other property concerns, there are additional methods that should be taken to ensure there are no problems after the purchase. For example, you can pay someone to perform a title search to verify that there are no title problems with the property. You can also purchase title insurance, which can protect you from losses associated with potential title problems.

You will also want to make sure that dual grantees are listed properly on the deed. There are two ways to list grantees, and both have very different meanings. If dual grantees are listed as “joint tenants” the property passes automatically to the surviving grantee or grantees should death occur. However, if dual grantees are listed as “tenants in common” the property may pass to the deceased’s heirs rather than the remaining grantee or grantees.

If you have any doubt as to how certain information should appear on a deed, it is essential to speak with a professional who can advise you in such matters. The last thing you want to face is a battle for property that you believe you have the rights to.