Sellers use deeds to give titles to buyers, but not every deed is equal. A buyer looking for a good title needs a warranty deed. That deed is the seller's legal promise that he owns the land free and clear. It's also his promise to make things right if there is a problem in the future. Warranty deeds approved by legislatures carry the name statutory. That's the type deed a buyer wants.
When someone drafts a deed she uses a form. This saves time and also ensures a good document. The form may be one approved by the state bar association or a title company. In some states, like Washington, the form for a warranty deed is outlined in a statute. Sellers don't have to use the statutory form, but as a buyer you should insist on it. It provides protection against problems with title to your land.
The grantor states in writing that he owns the property and can transfer title. This means every person who needs to sign the deed has done so. It cuts down on the chance that some unknown heir can appear later and claim partial ownership. Sometimes, the buyer has to believe the grantor because you can't know the grantor's family tree. If the grantor is not telling the truth, he can be forced to pay you damages for any problems to the title.
As a buyer you pay for a title search. That search should find any liens or encumbrances against the property. If there are any such legal issues, such as utility easements or restrictive covenants, the grantor has to name them in the deed. You can find them as exceptions. As a buyer, you take the title subject to the exceptions listed. Hopefully they match the exceptions found in your title search.
Defense of Title
Perhaps the most important warranty is that of peaceable possession and defense of title. In other words, the grantor promises you'll get the property with no headaches and he, not you, will legally fight any other claims the title. According to Washington attorney Joseph Rockne, this could end up costing a grantor thousands in legal fees. It could also span decades since it applies to the grantor, his heirs and successors.
- Comstock/Comstock/Getty Images
- "What Does ""Fee Simple Ownership"" Mean?"
- How to Add a Beneficiary to a Mortgage Deed
- How Do I Add Another Person to My House Deed?
- What Do I Do if Title Insurance Is Not Approved for a House?
- What Is the Difference Between a Warranty Deed and a Quitclaim for Property?
- Does a Real Estate Deed Have to Be Filed and Recorded?