Deed Templates

Real estate transactions are more complex than many other transaction types. When real property changes hands, a new deed must be recorded to mark the change in ownership. If you’re new to the world of real estate, you might wonder: What is a deed, and why does it matter?

What a Property Deed Is and How It Works

So what is a deed, exactly? A property deed is a document that officially transfers ownership of a piece of real estate from one party to another. Once a deed is completed, it’s filed in the office of the recorder or county clerk. Having the deed on file can protect against ownership disputes in the future.

Notably, even if you don’t record the deed, it still serves as a binding agreement between you and the seller. However, because third parties, including the previous owner’s potential creditors, won’t recognize you as the owner, failing to record the deed may lead to liens and potential loss of the property.

Deed vs. Title vs. Mortgage

These three terms are all related to real estate, but each is slightly different:

• Deed: A physical document marking the transfer of ownership
• Title: The concept of legal ownership and property rights (not an actual document)
• Mortgage: A loan agreement made with a lender to finance the property

In other words, the deed represents the property transfer, the title represents ownership and the mortgage represents the debt.

Get Access to All 66 ConsumerShield Legal Templates

Types of Deeds

Some of the most common types of deeds include:

• Quitclaim Deed: Quitclaim deeds quickly transfer property from one person to another without making any claims about the title’s validity. These deeds should generally only be used in situations where no money is being exchanged and both involved parties trust one another. You can generate a quitclaim deed easily online.
• Warranty Deed: Generating a warranty deed grants maximum protection to a buyer because the seller guarantees the property has a clear title. If a title defect later comes up, the seller has a legal obligation to defend your right to the title and cover any financial damages.
• Special Warranty Deed: With a special warranty deed, a seller promises that there are no title defects that originated while they owned the property. This type of deed does not guarantee against pre-existing title defects, though. You can generate a special warranty deed in minutes.
• Grant Deed: Grant deeds are similar to special warranty deeds, but they typically offer buyers narrower protections. They are standard for residential real estate sales in some states, including California. Generating a grant deed online is quick and simple.

Different types of deeds may be more appropriate depending on the circumstances. For instance, if one spouse is receiving the family home in a divorce or a close family member is transferring a home to you, a quitclaim deed might be sufficient. But if you’re buying a home from a stranger, you’d likely want a warranty deed.

If the deed to a piece of real estate doesn’t offer you complete protection as a buyer, there are other steps you can take to protect yourself. For example, if your home purchase involves a grant deed, title insurance may help shield you from liability related to hidden title defects.

Elements of a Legally Valid Deed

Generally, a deed must include the following:

• The names of the old (grantor) and new (grantee) property owners
• A thorough legal description of the property
• Language clearly conveying the property from one party to the other

Many people don’t realize that a property’s legal description is much more detailed than simply putting the mailing address on the deed. A thorough legal description will describe the shape, location and measurements of a given property. Some states and regions have distinct systems for measuring and describing plots of land.

The deed must be signed by both parties, and many states require it to be notarized. When creating and executing a deed, it’s critically important to pay attention to state-specific requirements. If you don’t, the document may not be legally valid.

Why Deeds Matter in Real Estate Transactions

What is a deed for in the long run? Ultimately, deeds matter in real estate transactions because they clearly mark a transfer of ownership and make that transfer a matter of public record.

Different types of deeds have similar purposes, but choosing the right deed for your situation is crucial. When in doubt, it’s wise to consult a real estate lawyer for guidance.

At ConsumerShield, we offer a wide range of professionally reviewed legal forms and templates. Take a look at our template library today.