When you become the new owner of a property, the seller will transfer legal ownership to you via a deed. A deed is a legal document that transfers ownership of real estate from one person to another.

When dealing with raw, vacant or undeveloped land, a buyer will typically see one of three types of deeds recorded with the county: General Warranty Deed, Special Warranty Deed, and Quit Claim Deed.

Understanding the difference between each type of deed is important so that you know which type best applies to your situation. Let’s take a look at what these three main types of deeds are and how they differ from each other.

The General Warranty Deed

The gold standard of all deeds is the general warranty deed. This type of deed provides the most protection for buyers because it guarantees that the seller has clear title and that there are no liens or encumbrances on the property.

It also guarantees that there were no prior claims made against the property by any previous owners. In addition, a general warranty deed provides warranty coverage in case someone files a claim against your title in the future.

As a buyer getting a general warranty deed, you know that the seller will transfer the title to the property with no risk to you.

The Special Warranty Deed

A special warranty deed provides slightly less protection than a general warranty deed, as it only covers defects or liens resulting from actions taken by the current owner during their period of ownership.

This means if you purchase a property with this type of deed, you can rest assured that any issues stemming from its current owner will be covered should something arise in the future.

However, any problems stemming from previous owners may not be covered and could still lead to potential legal issues down the line.

Quitclaim Deed

Finally, we have quitclaim deeds, which provide very little protection for buyers since they do not guarantee clear title or offer any warranties whatsoever. Quitclaim deeds are typically used when transferring properties between family members or when releasing interest in a property due to divorce proceedings, death, etc. In these cases, it is usually understood that there are no claims against the transferor (the person transferring title). However, this type of deed leaves buyers with very few protections should something go wrong later on down the line.

In the end, it pays to do your research and make sure you understand the implications of different documents when transferring ownership of real estate. Whether you’re buying or selling, having a clear understanding of which type of deed is necessary can save time, money and stress in the future!

Speaking of knowledge, why not read further on real estate and check out our “How to Buy Raw Land in 5 Easy Steps” article? Shopping for land has never been so easy! Have a look — you won’t regret it. 

Thanks for joining us today — we hope this article has helped you wrap your head around the ins and outs of dealing with deeds. Until next time!