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 FAQS
  1. What is the difference between adjusted and regular funds from operations?

    While regular funds from operations measures the cash flow generated by the operations of a real estate investment trust ... Read Full Answer >>
  2. What are examples of typical leasehold improvements?

    Typical leasehold improvements include partitioning a large, open space into smaller, more structured areas such as dressing ... Read Full Answer >>
  3. How much of the global economy is comprised of the real estate sector?

    The commercial and residential real estate industry generated an estimated $3 trillion in 2014, with some 35% of sector revenue ... Read Full Answer >>
  4. What is the process for a building owner depreciating leasehold improvements in a ...

    As long as the building owner is the person or entity that provides leasehold improvements, then the owner can depreciate ... Read Full Answer >>
  5. How can I invest in tax liens?

    An individual can invest in tax liens by identifying available liens and then participating in auctions where property tax ... Read Full Answer >>
  6. What kinds of real estate transactions use triple net (NNN) leases?

    A net-net-net lease, also known as a triple net or NNN lease, is a type of real estate lease that requires the tenant to ... Read Full Answer >>
Related Articles
  1. Home & Auto

    Five Things to Know About Quitclaim Deeds

    If that property you're about to buy has a quitclaim deed, check very carefully before you hand over your cash.
  2. Home & Auto

    Understanding Property Deeds

    We help you figure out the terminology and types of deeds, and how to make it legal.
  3. Mutual Funds & ETFs

    ETF Analysis: ProShares Short MidCap400

    Discover the benefits and drawbacks of the ProShares Short MidCap400 ETF, and learn which investors are best suited for the fund's investment strategy.
  4. Entrepreneurship

    How Grant Cardone Built a $350M Real Estate Empire

    Sales trainer Grant Cardone built his multimillion-dollar real estate empire without raising external capital from anyone beyond his close family members, who own less than 2% of the Cardone ...
  5. Home & Auto

    When Is the Best Time for You to Buy a House?

    Making what is likely to be the single most expensive purchase of your lifetime shouldn’t be done on a whim.
  6. Investing

    Where Are Real Estate Stocks Heading?

    We summarize five economic reports that investors should monitor monthly to keep them informed of where real estate and its related stocks are heading.
  7. Investing

    Looking for Alternatives to Invest in Real Estate?

    There are several ways to invest in “real estate” via the stock market, buying stocks and hold them for years. We give you 5 ways to invest in real estate.
  8. Home & Auto

    10 Things Your Real Estate Broker Won't Tell You

    Whether you're selling a home or buying one, go in with eyes wide open when you're working with a broker.
  9. Investing

    Find the Private Island of Your Dreams

    The perks, the problems and the pleasures of owning your own little piece of paradise.
  10. Investing

    Can I Afford To Buy A Private Island?

    It may not be as pricey as you think, but don't forget to pay attention to the rights you're buying and, perhaps, factor in the cost of building a house.

You May Also Like

Hot Definitions
  1. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  2. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  3. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  4. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
  5. Grandfathered Activities

    Nonbank activities, some of which would normally not be permissible for bank holding companies and foreign banks in the United ...
  6. Touchline

    The highest price that a buyer of a particular security is willing to pay and the lowest price at which a seller is willing ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!