Transferring property: a primer on deeds and titles

A property deed is a legal document that transfers title or rights of ownership from one party to another. It’s the official proof of transfer document that gets recorded, usually by your local county government.

A deed should include an indication that it is a deed, a description of the property, the signature of the individual or entity transferring the property, and information on who is taking the title. Every property transfer requires some type of deed.

A deed is the actual legal document that transfers title from one person to another. A title is not a document, but a concept. It says you have legal rights to use the property. When you buy a property, you receive a deed that says you have title to the real estate.

Typically, to purchase a property, your lender will perform a title search, verifying the seller has the legal right to transfer ownership and that there are no liens against the property. The title company ensures the deed is recorded with the appropriate authority.

If a property is not recorded properly, there can be gaps in the title. Such gaps can raise questions about whether the person transferring the property had the legal right to do so and whether you’re in fact the valid owner.

There are several different types of deeds, which vary based on the warranties provided to the grantee (the person receiving the property). Here are two of the most common:

  • Warranty deed: A warranty deed guarantees clear title to a property. It ensures the grantor is the legal owner and has the right to convey the property. This deed also ensures there are no liens or encumbrances on the property other than those listed on it.
  • Quit claim: A quit claim deed transfers interest in the property from one party to another, without guaranteeing the status of the property. It’s typically used to transfer interest between family members, when moving property into a trust, or when there has been a division of property such as in a divorce or business dissolution.

Other special-purpose deeds may be used, including a special warranty deed, a bargain or sale deed, or a grant deed. Whenever transferring property, you should use a real estate attorney to ensure you have the right legal document and protections for your situation.

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