Real Estate Law
Real Estate Deeds and Taking TItle to Real Estate
In very general terms, a deed is the a document that transfers ownership of real estate from one person or entity to another person and/or entity. While the requirements for legally valid deeds vary widely from state to state, there are some different types of deeds that are consistently used in real estate transactions, including warranty deeds, grant deeds, and quitclaim deeds. Additionally, there are different methods by which a person or multiple persons can take title to real estate pursuant to one of these deeds.
Real estate laws are state-specific and depend on where you live and the location of the property. It is important to talk to a real estate professional in your area to get the best legal advice for your situation.
Warranty deeds are designed to protect the buyer from any problems that might arise in the context of title to your real estate. Used most frequently in the buying and selling of real estate, warranty deeds not only transfer ownership of real estate from seller to buyer, but these legal documents constitute explicit warranties, or promises, that the seller is making to the buyer regarding the title to the property.
Similarly, grant deeds are legal documents that transfer ownership of real estate from seller to buyer. As is the case with warranty deeds, grant deeds contain promises that the seller has good title to the real estate, and that the seller has not already transferred the title to another person or entity. The major difference between grant deeds and warranty deeds is that where promises are explicitly made in warranty deeds, grant deeds contain only implicit promises.
On the other hand, quitclaim deeds transfer a person or entity’s interest in a parcel of real estate but make no warranties or promises to the buyer or the person who is receiving the real estate. Quitclaim deeds are commonly used by divorcing couples who wish to transfer real estate from both spouses to one spouse, or when people leave real estate to family members through a trust, a will, or another estate planning document.
It is important to note, that transferring legal title via quitclaim deed in a divorce situation does not solve the problem of a jointly held mortgage that is secured by the real estate. A transfer in title without permission from the lender may cause a default of the mortgage or foreclosure.
Quitclaim deeds also are useful if there is some sort of “cloud” on the title, or some conflicting claims of ownership or unclear title history. By quitclaiming his or her interest in a parcel of real estate, the grantor can effectively clear the title to the property and clarify its ownership. Note that this is a difficult process. You should consult with a real estate attorney before executing a quitclaim deed.
Whatever type of deed is utilized to transfer ownership of real estate, people can take legal title to the real estate in different ways. Multiple people can take title to real estate as joint tenants or as tenants by the entirety. Joint tenancy and tenancy by the entirety both provide succession to the remaining tenant. If one tenant passes away, the surviving owner automatically receives ownership of the deceased tenant’s share of the property.
In a deed transfer where the grantees take title by joint tenancy, the deed must generally contain the term “with right of survivorship” or it may be considered tenants in common.
In many states, if two or more people own a parcel of real estate, they all must hold equal shares of the property. In that situation, if one joint tenant passes away, the remaining joint tenants receive the deceased joint tenant’s interest in the real estate in equal shares.
Multiple persons can also hold title to real estate as tenants in common. In many states, unmarried couples who hold real estate together are deemed to be tenants in common. The main difference between tenants in common and joint tenants is that if one tenant in common passes away, the surviving tenant(s) in common do not automatically receive the deceased tenant’s interest in the real estate.
Rather, the deceased tenant’s interest would be passed down to his or her heir(s) according to the estate plan, or, where there is no estate plan, according to the laws of intestate succession. In most states, tenants in common are permitted to hold title to real estate in unequal shares where the deed must contain the actual percentages of each tenant.
This article is intended to be helpful and informative. But even common legal matters can become complex and stressful. A qualified real estate lawyer can address your particular legal needs, explain the law, and represent you in court. Take the first step now and contact a local real estate attorney to discuss your specific legal situation.
Have Real Estate Questions?
Whether you are looking to buy or sell or you're in a dispute, real estate lawyers in our directory can protect your rights and interests.