A deed is defined as an instrument, of various forms, by which title to real estate is conveyed from one party to another. Most of us know what a deed is and how it works in regards to owning and purchasing a home, however, did you know that there are different types of deeds? Below are the three most common types of deeds that you will run into in regards to your real estate.
1. Warranty Deed – a deed containing one or more title covenants.
What is a title covenant? Good question! They are akin to promises by the seller (grantor) to the purchaser (grantee). There are four main covenants:
(1) the seller is the absolute owner of the entire property
(2) the seller has the right and power to convey the property
(3) there are no encumbrances on the property which would diminish the value of the property being conveyed
(4) the purchaser shall enjoy possession of the property peacefully, without any claims by any person having a better title or claim to it.
2. Deed of Trust – an instrument in the nature of a mortgage which secures the payment of a debt.
3. Quit Claim Deed – a deed that is intended to pass any title, interest or claim that the seller may have in the property. This does not imply that title is valid, nor does it provide any of the covenants of the warranty deed. The purchaser gets only what interest the seller has to give. A quit claim deed is a good way to add or remove someone from title. It is also a good way to correct typographical errors.
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