Mar 15 2019
Mistake # 2 Not Understanding Different Types of Deeds
Posted in Real Estate
There are 3 primary types of deeds; each type is listed below with an explanation:
- Quit Claim Deed – This is the lowest of the 3 deed types; it basically transfers the property with no guarantee of a free and clear title. It transfers to the buyer whatever rights to the property the seller had. So if the seller didn’t have the right to transfer the property, then it transferred no rights to the buyer.
- Special Warranty Deed – This deed provides 2 warranties to the buyer:
- The seller warrants that they own the property
- The seller warrants that during their ownership period there have been no liens or encumbrances placed on the property So basically, the seller is saying that they warrant the property during their ownership only and not during any time outside of their control.
- Warranty Deed – This is the king of all deeds. This deed basically warrants to the buyer that the title is clean not only during the current owner’s period but that the deed is clear of liens and encumbrances from the beginning of time. Too often I see people buying land on Quit Claim deeds and without a complete title search (see Mistake 1) and that is a disaster waiting to happen.
On to the final mistake. (Mistake 3)