Prelude: Dear Readers and Fellow Bloggers. Due to circumstances beyond my control, there has been a long break in my writing. However, I am back and I encourage you to participate. Feel free to add your comments to articles posted, and please do let me know what topics you might like to see covered. I begin my return with a short article about using various deeds to transfer title.
Deeds in Title Transfers:
Every once in a while I see articles in the newspaper where a real estate “guru” advises somebody to use a “Quit Claim” deed to transfer title. What is often left unsaid is that there are times when this is appropriate, but often it is not. In fact, there are several different types of deeds that can be used to transfer title, the two most common (in this area at least) are the Quit Claim and the Grant deeds.
Quit Claim Deeds:
Basically this type of deed transfers any claim the grantor (the person who signs the deed) may have in a property to the grantee (the person receiving the deed). The trick here is that there is no guarantee that the grantor has any claim in the property in the first place. As an example, I could easily sign a Quit Claim deed transferring any interest I may have in the Empire State Building to you, but the reality is that I don’t have any claim in that building, so you have received a worthless piece of paper. There is a great deal of risk in using this particular type of deed in the transfer of title except in very limited cases. One example might be in a divorce settlement where, as part of the settlement, one spouse transfers his or her claim to part of the title on commonly owned property to the other spouse. In this example the person receiving the deed would be pretty sure that the grantor really does have partial ownership of the property so they are receiving something of value (although there have been cases where a bitter spouse has actually sold his or her share to a third party and given them a grant deed to the property so that, by the time the Quit Claim deed was signed, there was nothing left to transfer.) It is also sometimes used if one partner in a marriage who wishes to transfer title to a new owner holds title in his or her own name, but the couple lives in a community property state. A quitclaim deed signed by the spouse whose name is not on title removes that person’s claim under community property laws. Please note that a quitclaim deed does not relieve the individual transferring ownership from any mortgage liability that may exist.
Grand Deed:
In Californa, Grant deeds are the most commonly used property deeds to transfer title to a property. The advantage of using a Grant deed as opposed to a Quit Claim deed is that the grantor warrants that:
a) the property has not been sold to anybody else and
b) the property is not burdened by any encumberances (loans, liens, etc) that have not been disclosed to the person receiving title.
Grant deeds do not need to be recorded in order to be valid, although it is always advisable to do so. It also does not need to be notarized although a prudent buyer will insist that the deed be notarized as it provides a witness to the transaction and the notary must be confident that the person signing the deed is, in fact, who they say they are. (Some sources used in this research state that a Grant deed must be notarized in order to be valid. This may or may not be true. Readers are adviser to consult with legal counsel to verify the accuracy of the information contained herein or to have additional questions answered.) Also, a deed must be notarized before it will be accepted for recording.
In order to be valid the Grant deed must be in writing, clearly state that title is being transferred, include the names of both the grantor and the grantee plus a description of the property being transferred. The grantor must sign the document and the deed must be properly executed. This means that it must be delivered to the grantee during the grantor’s lifetime (not placed in a safe deposit box for delivery after the grantor dies!!) and the grantee must accept it.
Warranty Deeds
Warranty deeds are used instead of Grant deeds in some states. They are very similar except that the Warrantee deed must include a legal description of the property (usually also provided with a Grant deed) and it must be notarized. And it must be recorder with the County Recorder or Recorder of Deeds.
In addition,the grantor will warrant and defend title against the claims of all persons. This means the grantor is guaranteeing the grantee that title is free of any defects that may affect the title, even if the defect was caused by a prior owner.
Other Types of Property Transfer Deeds:
Tax Deed: When property is sold for non payment of property taxes, a tax deed is used to convey title to the buyer.
Gift Deed: These deeds are used when property is transferred without payment of money, usually between people who are closely related, such as parents to children, etc.
Deed-in-Lieu of Foreclosure. Sellers who are in danger of losing their home to a lender through foreclosure may opt to use a Deed-in-Lieu of Foreclosure to transfer title to the lender to avoid foreclosure (although the deed may still show up on the person’s credit report.)
For more information concerning property deeds and their legal ramifications, please contact a local real estate lawyer, because this Web site cannot give legal advice. | 
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• Feb. 6, 2008 - RE: Deeds in Title Transfers