What is the difference between a warranty deed and a Quit Claim Deed? I recently paid my taxes and verified it on line and noticed under “Type of Instrument” Quit Claim Deed. Others however were listed as Warranty Deed. I quickly found a couple of other related papers which said “…does hereby reconvey without warranty to the person entitled thereto the trust propery now held by it as Trustee under said Trust Deed.” Prior to this there is a page which names the W? Title Company as the successor Trustee. Why is my property not listed as Warrany Deed versus Quit Claim Deed and Why did the Title company in reconveying say without warranty. Does this Without Warranty limit my right of ownership or resale?

A quit claim deed is used when a party who is in title to a property wishes to relinquish his/her claim to the title, in other words take his/her name off the title. It is typically used in a divorce settlement when one spouse has been awarded the home and the other has to record a quit claim deed to relinquish title, giving the other party sole ownership.

A warranty deed is typically used by a seller to pass title to a buyer at the closing of a sale and purchase of a property. Many times, however, sellers don’t want to use a warranty deed to pass title because it legally warrants clear title to the buyer and sellers don’t want to risk a lawsuit if there might be an unrecorded lien against the property that pre-dates their ownership and that they did not know about. That’s what title insurance is for, to protect the buyer against an unrecorded lien that the seller did not know about or did not disclose.

That is why the title company reconveyed the property “without warranty” because they were not issuing title insurance but just processing and recording a reconveyence.

“Without warranty” does not limit your rights of ownership or ability to re-sell the property, but it does not protect you against any valid liens against the property that were never listed on the public record, if any exist. You should contact a local title insurance company and inquire about purchasing a policy that will protect you. Also, upon the sale of the property, purchasing a policy of title insurance ensures the passing of a clear title to the buyer.

This entry was posted in Real Estate and tagged . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s