Types of Deeds

Posted by Unimarks on November 16th, 2019

A property deed is a contract that is used to convey the real estate property from a grantor or seller to a grantee or buyer. For a deed to be legally acceptable, you may have to include the identifications of the grantor and the grantee, and also all the adequate description of the property that is subjected to sale. More specifically, deeds fall in a few numbers of categories, including warranties, quitclaims, and special purpose deeds. This article will give you an insight into what are the types of property deeds.

Types of Deeds

Deeds are generally classified in numerous ways. Broadly, deeds are classified into official and private deeds. Official deeds are executed pursuant to a court or for legal proceedings. For property transactions, however, involve individuals and business entities using a private deed.

Deeds are also categorized based on the type of title warranty which is provided by the grantor. The different types of deeds:

1. General Warranty Deed

The general warranty deed offers the grantee the best protection. With this deed, the grantor makes a series of legally bonded promises which are called covenants and other warranties to the grantee and their heirs, agreeing to protect the grantee against any of the prior claims and demands of all personal in regard to the conveyed land. These usual covenants for the title come included in the general warranty deed.

They are:

–> Providing the covenant of seisin, which means that the grantor warrants their prior owned property and hands the property including its legal rights.

–> Providing the covenant against encumbrances denotes that the grantor warrants that the property is free of liens or encumbrances, except for any specifically stated condition drafted in the deed.

–> Providing the covenant of quiet enjoyment, indicating that the grantee will have quiet possession of the property and will not be disturbed because the grantor had a defective title.

–> Providing the covenant of further assurance, where the grantor promises to deliver any document necessary to make the title good.

2. Special Warranty Deed

Where in a general warranty deed the grantor promises to warrant and defend the title conveyed against the claims of all personals, the grantor of this special warranty deed warrants that they receive the title of the property and that they haven’t done anything while holding the title of the property to create any sort of defect. In other words, only defects that have arisen during the grantor’s ownership of the property are being warranted. Due to this specific limitation, the special warranties will offer the grantee to less protection than the general warranty deed on its own. Many purchasers of real estate would insist on a general warranty deed to avail protection against problems that could arise as a result of a special warranty deed.

3. Quitclaim Deed

The quitclaim deed, also called a non-warranty deed, offers the grantee the least amount of protection. This is a type of deed that conveys whatever interests the grantor currently has on the property if there are any. No warranties or promises regarding the quality of the title are to be made. If the grantor has a good title, this deed is as effective as the general warranty deed. However, if the title contains any defects, the grantee has no legal recourse against the grantor under this deed. A quitclaim deed could often be used if the grantor is not specifically sure of the status of the title, if it contains any defects or if the grantor wants no liability under the title covenants in the deed.

4. Special Purpose Deeds

Special purpose deeds are frequently used when there are connections to court proceedings on sale and instances where the deed is from a person acting in some type of official capacity. Most special purpose deeds offer very little to absolutely no protection to the grantee and are similar to quitclaim deeds. Types of special purpose deeds include:

–> Administrator’s Deed: This could be used when a person dies without a will. A court-appointed administrator will dispose of the decedent’s assets and further an administrator’s deed may be drafted to convey the title of the real property to the grantee.

–> Executor’s Deed: This sort of deed is used when a person dies with a will. The estate’s executor would dispose of the decedent’s assets and this executor’s deed will be used to convey the titles or real estate properties to the grantee.

–> Sheriff’s Deed: This is generally granted to the successful bidder at an exhibition type sale held to satisfy the judgment that has been obtained against the owners of the property. The grantee will receive whatever title the judgment debtor previously would have possessed.

–> Tax Deed: This is issued when a particular property is being sold for delinquent taxes.

–> Deed in Lieu of Foreclosure: This is given by a borrower who is in default on a mortgage directly to the lender. This deed prevents foreclosure proceedings, and if the lenders would accept the deed in lieu of foreclosure, the loan is then considered as terminated. Many lenders generally prefer to foreclose in order to clean up their respective titles.

–> Deed of Gift (Gift Deed). This is simply used to convey the titles of the real property that has been granted as consideration or as a token consideration. In a few countries, the gift deed must also be recorded within two years or it automatically becomes void.

source : http://www.unimarkslegal.com/property-law/different-types-property-deeds/