Grantee: Definition and Examples in Real Estate

What Is a Grantee?

A grantee is the recipient of a grant, scholarship, or some other asset such as real estate property. In contrast, a grantor is a person or entity that conveys ownership of an asset to another person or entity: the grantee. Identifying the grantee and grantor is especially important in legal documents as specific duties, responsibilities, benefits, and limitations are assigned to each.

Understanding Grantees

A grantee is the recipient of something granted or given. The term can be used in different contexts and across different industries and institutions. In real estate, the grantee takes title to the purchased property. In academia, a grantee is the recipient of a scholarship or grant. In the investment industry, a grantee can be the recipient of stock options.

Key Takeaways

  • A grantee is the recipient of something, such as a college grant or real estate property.
  • A grantor is a person or entity that transfers to another person or entity the interest or ownership rights to an asset.
  • Legal documents, such as deeds, detail the transfer of assets between grantors and grantees.
  • The type of legal document determines what limitations are placed on rights and interests transferred to a grantee.

The grantor and grantee are named in legal documents, such as deeds, which transfer from one party to another the interests or rights to an asset. However, what exactly is being transferred can differ depending on the type of legal document. For example, in real estate, a quitclaim deed provides no warranty regarding the status of the property's title to the grantee. This type of deed can render the grantee powerless should there be title defects whereby no interest in the property is transferred to the grantee. These types of deeds are uncommon between parties with no existing relationship.

Special warranty deeds assure the grantee that the grantor owns the asset, such as real estate property, and had no issues with the title during their ownership. The special warranty deed does not provide any guarantees about the title before the grantor's ownership.

General warranty deeds include warranties and covenants, offering grantees the most protection. With this deed, the grantee receives a warranty that the title is without title defects, such as encumbrances. It is not limited to issues that arose during the seller's ownership.

Special Considerations

A county grantor-grantee index provides a record of real estate transfers showing who released ownership of a property and who took ownership. The index also shows the property's legal description, its location, and the type of document used to transfer ownership (e.g., quitclaim deed, trust deed, or tax lien). Typically, the index is maintained by the county recorder.

Grantee Example

The parties in a debt lien are also known as grantors and grantees. The most common of these include mechanic's liens, tax liens, and judgment liens. In a financed automobile arrangement, the car's owner (grantor) transfers their interest in the vehicle to the lender (grantee). The grantee has an interest in the asset until the loan is satisfied by the grantor. If the grantor breaches the contract, the grantee may take possession of the asset.

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