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. Business Broker

    A professional who specializes in the purchase and sale of companies. ...
  2. Realtor Property Resource (RPR)

    A National Association of Realtors member benefit providing realtors ...
  3. Housing Choice Voucher Program

    The Housing Choice Voucher Program helps families with very low ...
  4. Sharing Economy

    An economic model in which individuals are able to borrow or ...
  5. Collaborative Consumption

    The shared use of a good or service by a group.
  6. Forbearance

    A temporary postponement of mortgage payments.
Related Articles
  1. Should You Buy Property On Leased Land? ...
    Retirement

    Should You Buy Property On Leased Land? ...

  2. 4 Overlooked Homeownership Costs
    Home & Auto

    4 Overlooked Homeownership Costs

  3. Foreclosure Opens Doors For Real Estate ...
    Home & Auto

    Foreclosure Opens Doors For Real Estate ...

  4. How To Add Real Assets To Your Portfolio
    Investing Basics

    How To Add Real Assets To Your Portfolio

comments powered by Disqus
Hot Definitions
  1. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  2. Debit Spread

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

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  4. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  5. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  6. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
Trading Center