The ownership of real property is transferred through the use of property deeds, which are legal documents used in real estate (buyer). Real property includes both land and anything that is affixed to it, such as structures or roads. A deed must identify the grantor and grantee and provide a sufficient description of the property in order for it to be legally enforceable.
What Are Property Deeds?
A property deed is a formal document that is both written and signed and is used to transfer ownership of real estate from the grantor—the previous owner—to the purchaser (the grantee). In the past, real estate was passed on through a ceremony called “livery of seisin.” In this transaction, the person transferring the land gave a twig or clod of turf to the one receiving it. The act was often accompanied by a spoken or written statement, but it was the livery of seisin that legally gave the new owner the right to the property. Today, a paper deed is used to show who owns a piece of land.
Deed’s Key Components
Even though every state has its own laws, most deeds need to have a number of key components to be legally enforceable:
- They have to be put in writing. Although printed forms are typically utilized, there is no legal requirement that a particular form be used as long as the necessary components are provided.
- Both the grantor and the grantee must be able to legally transfer the property, and they both must be able to accept the grant of the property. A person is deemed competent to be a grantor if they possess the legal ability to create a binding agreement.
- It is necessary to be able to determine both the grantor and grantee.
- A complete description of the property is required.
- There must be effective words of communication. All deeds in the conventional form contain the necessary legal text to transfer the property.
- If the property is owned by more than one person, the grantor or grantors must sign the deed.
- The grantee or a representative of the grantee must receive the deed in a legal manner.
- The grantee must agree to the deed. Deeds are often accepted by the grantee, but under certain conditions, the grantee may refuse delivery of the deed.
Types of Deeds
Deeds are classed in many ways. In general, deeds are categorized as either public or private. Execution of official deeds is done in accordance with a court order or legal proceedings. However, private deeds are typically used by people and businesses in real estate transactions.
Deeds are grouped by the grantor’s title warranties. Among the different kinds of deeds are:
- Quitclaim deeds: Used to transfer property among family members, convert properties into living trusts, and fix title issues. Quitclaim deeds don’t ensure title flaws like tax liens or easements. Since there are no legal protections against liens or encumbrances, people who know each other well choose quitclaim deed.
- General warranty deed: This guarantees a grantor’s ownership and legal right to sell. It also offers covenant against encumbrances, covenant of quiet enjoyment, covenant of further assurance, and covenant of warranty forever. It assures full title transfer from grantor to grantee with a covenant of seisin.
- Grant Deed: A grant deed is a special or limited warranty deed. It offers the same protections and assurances as a normal warranty deed, but only during the seller’s ownership. If a buyer faces a title claim from a previous owner, they must handle it themselves and have no legal recourse against the seller. If the buyer bought title insurance, the policy would likely cover title defense costs.
The deed must have a number of crucial components in order to be valid in court. The grantee is protected in varying degrees by different deeds, while a grantor’s obligations are regulated by the deed’s form. Deeds are significant legal papers that influence ownership rights and interests, thus any transaction involving them should be discussed with a qualified attorney.