Warranty of Title

AAA

DEFINITION of 'Warranty of Title'

A guarantee by a seller to a buyer that the seller has the right to transfer ownership and that no one else has rights to the property. In addition, a warranty of title may be used to guarantee that no other party has copyright, patent or trademark rights in the property being transferred.

INVESTOPEDIA EXPLAINS 'Warranty of Title'

A formal warranty of title is included in a warranty deed, which is used to legally transfer property in a sale. This document guarantees that the seller has the legal right to transfer the property and that no other entity, such as the Internal Revenue Service or an ex-spouse, has a lien against or claim to the property. A warranty deed’s warranty of title protects the buyer’s interests and gives the buyer legal recourse if any entity later tries to make a claim to the property.

A warranty of title is automatic in most sales, but if the seller is acting as a representative, no warranty of title may exist. This situation might arise in an auction, a sheriff’s sale or an estate sale. In these cases, the person selling the property is not its owner and therefore may not be aware of any other entity’s rights in that property.

 

 

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. Express Warranty

    An agreement between the contract seller (dealer, manufacturer ...
  4. Implied Warranty

    Under a sales contract, whether written or oral, there is a guarantee ...
  5. Special Warranty Deed

    A special warranty deed is a deed in which the seller warrants ...
  6. Total Annual Loan Cost (TALC)

    The projected total cost that a reverse mortgage holder should ...
Related Articles
  1. Check carefully before you buy property with a quitclaim deed
    Home & Auto

    Five Things to Know About Quitclaim ...

  2. Home & Auto

    Understanding Property Deeds

  3. You're probably moving a lot and still paying off your student loans. Is it crazy to get a mortgage in your 20s? Here's how to decide.
    Credit & Loans

    Does A Mortgage Make Sense If You're ...

  4. Make a second property more affordable by taking advantage of low mortgage rates to refinance it.
    Investing

    Learn How To Lower Your Second Mortgage ...

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  3. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  4. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  5. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center