What Is a Warranty Deed and How Does It Protect You?
While purchasing a house is an exciting endeavor, deed transfers and understanding your new responsibilities can make the process a bit more complicated. Prospective home buyers should learn about warranty deeds as a way to protect themselves and others.
Learn the answer to “What is a warranty deed?” and the importance of having one as a property owner. If you still have questions after reading or are considering lending options for your mortgage, contact Altitude Home Loans, the best mortgage lenders in Tucson, Arizona.
What Is a Warranty Deed?
Warranty deeds are the contract or documentation that verifies that a property’s seller has their title without any obstacles (liens, mortgages, etc.). It shows that there are no outstanding claims or fights for ownership of the property, verifying the buyer won’t have problems in this area.
Having a warranty deed can help a buyer with mortgage financing and title insurance. The seller becomes responsible if problems arise and they breach their agreed-upon contract. If a buyer purchases a property from a stranger, it’s an excellent idea for them to acquire a warranty deed.
What Are the Main Types of Warranty Deeds?
The types of warranty deeds you should learn about and may encounter include the following:
- General Warranty Deed. What is a warranty deed? This is the most popular type of warranty deed and provides property owners the highest level of protection. It helps them rest assured, knowing the home has no problems, including those from past owners.
- Special Warranty Deed. Special warranty deeds offer similar protection but do not include title problems before the seller’s ownership. This deed will hold the seller responsible for the time they owned the home but not actions prior to their ownership.
- Statutory Warranty Deed. These are like general warranty deeds, shifting ownership of a property between the seller and the buyer. However, you can obtain one through the state’s statutes, but some of the title history is unclear. It’s still legally binding and offers a fair amount of protection.
While people are looking for more ways to make homeownership more accessible despite today’s challenges, having a warranty deed can help.
How Warranty Deeds Protect Property Owners
Having a warranty deed means you can obtain the title to the property without issues. You’ll also know that you won’t have to face any outstanding title problems.
Obtaining a warranty deed is possible by contacting your real estate agent’s office or filling out an online template. The deed must have a description of the property, buyer signatures, the transaction date, the names of anyone involved in the process, and any title defects.
Other Related Types of Deeds to Know
Besides warranty deeds, you might hear about some of these related deeds:
- Deed in Lieu
- Quitclaim Deed
- Special Purpose Deed
Receive Guidance on Your Home-Buying Journey with Altitude Home Loans
We hope you now understand “What is a warranty deed?” and have a deeper understanding of deeds while purchasing properties.