A warranty deed is a legal document used to transfer the ownership of real property to a new individual. It’s a critical part of the real estate process, offering protection to the new property owner since the seller promises they have the legal right to transfer the property and that there are no undisclosed liens.
What Is a Warranty Deed?
A warranty deed is a legal document that a grantor (e.g., a seller) uses to promise to the grantee (e.g., a buyer) that they have the right to transfer a piece of real property, including a house, a building, or a land area.
A warranty deed doesn’t necessarily prove ownership. Instead, it’s the grantor’s sworn declaration that they, as far as they know, legally own the property and intend to transfer ownership to you, the grantee. However, grantors may not be aware of legal claims against the title to a property even if they have signed an affidavit of title.
What Happens If You Don't Have a Warranty Deed?
Without a warranty deed, you may have no recourse if you discover that the property you purchased is not free of debt or other liens (i.e., a claim someone else has on a property). It might even be that the grantor didn’t have the authority to sell the property.
However, if you have a warranty deed, you have the right to remedies, primarily by suing for damages (i.e., monetary compensation).
Types of Warranty Deeds
General Warranty Deed
A general warranty deed is a legal document used to transfer ownership of real property. It guarantees that the title to the property is warranted against all possible defects (even defects a grantor isn’t responsible for causing).
It offers more protection to the grantee by guaranteeing the entire property history, including the time before and after the grantor owned the property. It’s typically used when a grantee pays for a property because it provides the maximum legal protection.
A general warranty deed is the standard choice for real estate transactions. It transfers ownership of real property from one person or entity to another with warranties that the property has no liens or encumbrances.
Special Warranty Deed
A special warranty deed (or a limited warranty deed) guarantees against defects to a property’s title for the period when the grantor owned it. It’s useful when the seller doesn’t want legal responsibility for claims against the title before or after the time when they owned the property. If such claims were to happen, you would have to defend your title in court.
Rather than guaranteeing that the title is fully clear of all encumbrances and liens, this deed only covers the period the current seller owned the property. It does not include any liability for encumbrances or liens before the seller acquired the property.
Special Warranty Deed Example
Here’s an example of a special warranty deed to help you differentiate it from a general warranty deed:
Consider a home that had two owners before Owner C purchased it. Owner A was an amateur electrician who rewired some of the home’s electrical systems without the proper inspections or permits. The faulty wiring caused several electrical issues, and their city’s building department issued a citation demanding that they address the issues and bring the system up to code.
Owner A ignored the citation, and their financial difficulties led to the property’s foreclosure. Owner B bought it and repaired several of the issues. They eventually sold it to Owner C using a special warranty deed. Several years later, a property inspection revealed the unresolved liens from Owner A. These liens could encumber Owner C’s sale, meaning they must satisfy the liens to clean up the title.
Statutory Warranty Deed
A statutory warranty deed is an abbreviated general warranty deed that relies on state law to define the guarantees it provides the buyer.
Because some states have not passed laws setting up statutory warranty deeds, they may not be available in your state. However, the protections are the same as those in a general warranty deed.
Grant Deed
A grant deed transfers property ownership and affirms that the grantor hasn’t previously transferred the title to another party. It also promises that the property is without encumbrances except the ones they blatantly disclose.
Bargain and Sale Deed With Covenants
A bargain and sale deed with covenants lets the grantor convey property ownership and provide some level of protection against encumbrances. It focuses on covenants that protect against problems stemming from the grantor’s actions.
Other Types of Deeds
If these warranty deeds don’t meet your needs, consider using a different type of real estate deed, as they each serve a unique function and offer varying levels of protection during the sale or transfer of real estate or land.
Warranty Deed Requirements
Here are the key warranty deed requirements:
- Seller’s (Grantor’s) Information: List the individual(s) or corporation currently owning the property.
- Buyer’s (Grantee’s) Information: List the individual(s) or corporation who will be the new owner.
- Mailing Addresses: Provide the physical addresses (not PO boxes) of both parties.
- Legal Description of the Property: Include a legal description (you can usually find it on your property deed) to help everyone identify which property is being transferred.
- Parcel Number: This number is usually listed on the property’s tax statement. If you have trouble locating the parcel number, you can also call or visit the city, county, or court office where the property taxes are paid to get it.
- Joint Tenancy (if applicable): Warranty deeds can transfer ownership to multiple new owners, referred to as joint tenants. Specify the portion that each joint tenant will own (if applicable).
- Consideration: Provide the amount to be paid for the property, if any.
- Conveyance Clause: Indicate that the grantor will transfer property ownership to the grantee.
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Covenants: A warranty deed can contain up to six key promises or covenants that the grantor makes to the grantee. These promises, the first three which are present and the latter three which are future, are as follows:
- Covenant of Seisin: Confirms that the grantor legally possesses the property.
- Covenant of the Right to Convey: Confirms that the grantor has the legal right to sell the property.
- Covenant Against Encumbrances: Confirms that the grantor has revealed all encumbrances (property tax liens, etc.) to the grantee.
- Covenant of Warranty: Guarantees that the grantor will protect the property if another party tries to claim ownership.
- Covenant of Quiet Enjoyment: Guarantees that the buyer will enjoy owning the property without interference from third parties.
- Covenant of Further Assurances: Guarantees that the seller will address any encumbrances.
- Witnesses: Some states require that witnesses watch the owner sign the deed.
- Notary: The person transferring the property must take the deed to a notary public who will verify that the signature on the deed is authentic.
Additional Terms
In addition to the above provisions, here are some other terms you may want to include in your warranty deed if they apply to your property:
- Easements: The grantor can reserve the right to continue using the land (or part of it), perhaps to keep fishing in the pond or to drive along part of it to reach another property they own.
- Life Estate: The grantor can reserve a life estate interest in the property if they want to continue being the legal owner of the property until their death for tax purposes.
- Mineral Rights: The grantor can reserve any remaining interests in the property’s subsurface oil, gas, or other mineral rights.
How to Make a Warranty Deed
Step 1 – Gather Pertinent Information
Gather pertinent information that is discussed in the above requirements section. Ensure that you have the legal description in the proper format. Review an example below:
Lots 6, 7, and the South ½ of Lot 3, West 60 feet of South ½ of Lot 4, West 60 feet of Lot 5 and Lot 8, Block 20, OLD SURVEY, Leesville, Vernon Parish, Louisiana.
Step 2 – Draft the Deed
Draft your deed using our standard template. Keep the document as clear and concise as possible, and ensure you include the proper legal terminology.
Step 3 – Sign and Notarize
Have the grantor sign the deed. Depending on your jurisdiction, the grantee may also need to sign.
Seek the signature of a notary public, who will witness the signatures and attach their seal to the document.
Step 4 – Deliver the Deed
Deliver the signed and notarized deed to the grantee. You can make this delivery in person or via mail. Please adhere to the delivery method that both parties agreed to.
Step 5 – Record the Deed
Be sure to leave space at the top of your warranty deed for the county recorder’s office to put their seal on the document. Ensure all property taxes are also paid in full before filing the deed.
Your warranty deed should be filed in the public records at your local land records office. This office is sometimes called the county recorder’s office, land registry office, or register of deeds. You can usually find the land records office in your local courthouse.
The clerk will stamp your warranty deed with the date, book, and page number, which can be found in the court’s files. The office often charges a small fee (around $15 a page) to record a warranty deed.
General Warranty Deed Sample
Frequently Asked Questions
What’s the difference between a warranty deed form and a title?
A title proves an owner owns a property. On the other hand, a warranty deed is a document used to transfer a title from the old owner to a new owner.
If you own a property, you possess the title. You must fill in and sign a warranty deed to transfer the title to a new owner when you wish to sell or give away the property.
What’s the difference between a warranty deed and a quitclaim deed?
The main difference between a warranty deed and a quitclaim deed is their primary use. Individuals who know each other well use quitclaim deeds to transfer property because quitclaim deeds don’t offer a promise of the title or have any covenants.
On the other hand, warranty deeds are for more formal real estate transactions between parties who don’t know each other.
What’s the difference between a warranty deed and a deed of trust?
A deed of trust is unrelated to a warranty deed. A deed of trust is an alternative to a mortgage in several states (e.g., California, Texas, and Colorado) and the District of Columbia.
A deed of trust ensures that a lender (e.g., a bank) retains an interest in a property if the borrower defaults on their loan.
