Deed -v- Title

Deed

A legal document that transfers property ownership from a seller/grantor to a buyer/grantee.

A deed contains a description of the property, property lines, denotes the seller and the buyer, and is signed by both those parties.

There are also several kinds of deeds:

General Warranty Deed – Protects the buyer by assuring that the seller has full title and is the sole owner with the rights to sell and that they have no knowledge of any property issues. A mortgage company generally prepares this sort of deed.

Special Warranty Deed – This is very similar to the General Warranty Deed, but only guarantees the title for the time the property was owned by the seller, which is usually used for the purchase of a commercial property.

Quitclaim Deed – Typically used when a property is transferred from one legal entity to another without money changing hands.

• Parents transferring property ownership to children
• Spouses transferring property ownership to the other
• Individuals transferring property ownership to an LLC or a trust

Title

A legal right to ownership of a property, including the right to sell, not just for real estate, also for boats, cars, and other property of value.

Title Insurance – meant to protect the buyer from unknown property issues or encumbrances, lenders will also require title insurance. This is crucial protection in case of any ownership dispute. If a dispute arises and you don’t have this insurance, the worst-case scenario is that you lose your property and the money you’ve invested into your mortgage.

Title Search – performed to uncover any limitation on property use, such as easements and any unresolved payments tied to the property, like liens. Helps determine the seller has a legal right to transfer ownership.

Abstract of Title– A document that lists the property’s prior owners, past encumbrances, or liens.