A deed is a common document used in real estate transactions to transfer property titles. Real estate deeds must be filed through the local County Recorder's office. They are used to document legal property description, individuals involved in the transaction, and property owner.
When real estate is transferred, a new deed is recorded. The type of deed used depends on the state where property is located, as well as the type of real estate transaction. The most common include: warranty deeds, deed of trust, quitclaim, grant, and deed in lieu of foreclosure. Let's take a brief look at each deed definition.
A warranty deed declares the real estate title is clean and no creditor judgments or tax liens are attached to the mortgage. A general warranty deed is used to convey interests in and title to the property to the new owner (grantee).
A special warranty deed protects the grantee against title defects or claims and guarantees the seller (grantor) has done nothing with the property during the time he has owned it which could prevent the grantee from obtaining a clear title.
Mortgage lenders use deed of trust to secure interest in real estate. About half of U.S. states use trust deeds instead of mortgage notes. Three parties are involved with this type of deed and include the lender, borrower and trustee.
The lender provides money to the borrower for the purchase of real estate. The bank is listed as the beneficiary on the legal title. If the borrower defaults on the deed of trust, the bank can lay claim to their property. The trustee holds claim to the property title until the house deed is paid in full.
Quitclaim deed is used to transfer real estate ownership interest. One of the most common uses for quitclaim deeds is to transfer ownership rights in divorce settlements. When married couples own jointly titled real estate and later divorce, a quitclaim is necessary to legally record the new property owner and remove the ex-spouse's name.
Grant deeds guarantee real estate property has not been sold to another person and has no liens or legal restrictions which could prevent the sale or transfer. Grant deeds are sometimes used in place of quitclaim or warranty deeds.
Deed in lieu of foreclosure is used when lenders allow borrowers to return their house to the bank. Deed in lieu transfers the borrower's property interest to the lender; allowing them to walk away without having to undergo the process of foreclosure.
We invite you to learn more about the different types of deeds and how they are used. Our deed article library includes a wealth of knowledge and resources on a wide range of topics. Take a moment to subscribe to our mailing list and receive instant notification when new articles are published.
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Published on December 22, 2009 at 03:39 AM
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