Warranty Deed

AAA

DEFINITION of 'Warranty Deed'

A document that may be used to legally transfer property. A warranty deed states that the owner can legally transfer the property and that no other entity has a claim or lien on it. These deeds are typically used in property sales and make warranties about the property’s title.

INVESTOPEDIA EXPLAINS 'Warranty Deed'

A warranty deed usually includes a legal description of the property, the names of the grantor (who is transferring the property) and grantee (who is taking ownership), and language conveying ownership from the grantor to the grantee. A warranty deed, in conjunction with title insurance, is necessary to secure the grantee’s valid ownership interest and gives the grantee legal recourse against any future claims to the property.

Contrast a warranty deed with a quitclaim deed, which releases an entity’s interest in a piece of property without guaranteeing that it has any interest in or rights to the property. For this reason, a quitclaim deed is not as useful in transferring ownership, since it only ensures that a particular entity does not think other outside entities have any claims to that property.

Quitclaim deeds are commonly used to transfer property between family members, whereas warranty deeds offer greater protection and are used to transfer property in a sale. 

RELATED TERMS
  1. Quitclaim Deed

    A deed releasing a person's interest in a property without stating ...
  2. Deed Of Surrender

    A legal document that transfers property ownership for a specified ...
  3. Grant Deed

    A legal document used to transfer ownership of real property. ...
  4. Tax Deed

    A legal document that grants ownership of a property to a government ...
  5. Special Warranty Deed

    A special warranty deed is a deed in which the seller warrants ...
  6. Unrecorded Deed

    A deed for a tangible piece of property that is not filed with ...
Related Articles
  1. Five Things to Know About Quitclaim ...
    Home & Auto

    Five Things to Know About Quitclaim ...

  2. Understanding Property Deeds
    Home & Auto

    Understanding Property Deeds

  3. Short Sale Strategies For Buyers And ...
    Investing

    Short Sale Strategies For Buyers And ...

  4. Lifestyle Inflation: Decide If It's ...
    Budgeting

    Lifestyle Inflation: Decide If It's ...

Hot Definitions
  1. Halloween Strategy

    An investment technique in which an investor sells stocks before May 1 and refrains from reinvesting in the stock market ...
  2. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  3. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  4. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  5. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  6. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
Trading Center