What is a property warranty deed ?
A property warranty deed is a type of deed where the seller also known as grantor has the clear title to the concerned property and has legal right to sell it to the buyer or grantee. It’s a promise to the buyer that the seller will guarantee any previous problems associated with the property title or regarding the property chain of ownership. By the property warranty deed, the seller makes sure that there are no hidden burdens or loans on the associated property. It also states that the grantee will compensate the buyer if any problem is found with the previous owner.
When to use a property warranty deed ?
A property warranty deed is used when a seller desires to transfer ownership and title deed of a property to the buyer. This deeds are most commonly used when a single owner or a couple intend to make a person as co-owner of the property. Whereas special property warranty deed is mostly used by sellers such as builders who own it long enough to build something on it and thereby make use of the warranty to avoid risks associated with title deed before their possession.
Using a deed to transfer a property
A property warranty deed is a crucial element when transferring real estate property, as it guarantees that the concerned property is not attached or having some bad loan. There are two sub types namely general and limited. General warranty is a better option as it covers all clauses including previous owners. Limited property warranty deed is only associated with the current owner of the property. All property deeds must be recorded within a specific time frame or else buyer could lose the benefits such as the legal protection offered to him.
Limited or general- which to select
A limited property warranty deed will provide limited protection against any problems associated with the land. It covers buyers from basic title problems which includes only the previous owner who owned the property. Any problems associated with property deed before the previous owner then the buyer doesn’t have much options. Therefore whenever doing any property warranty deed see whether it’s general or limited. General is best option if you want to get covered properly whereas if you know the history of the ownership of the property then a limited deed is also a good option. A property warranty deed is what decides your ownership of the property, so better deal well and do make the right choice.